Construction Industry and COVID-19
Since the onset of “shelter in place” there have been ongoing forums discussing the repercussions of the construction industry and COVID-19. Since the construction industry had been deemed to be “essential”, it then gets broken down further into what types of projects fall into that category.
Further, the definition of “essential” construction is being defined by various municipalities, varied as far down as by counties within the same state. For example, in NorCal, the construction industry and COVID-19 what is “essential” is only civil work, with private work being done specifically for COVID-19, hospital work.
This narrowed definition has not trickled down to SoCal and hopefully, it won’t. While most in the construction industry are fortunate to be able to still work. The work on job sites is very different than it was pre-COVID-19. Being allowed to continue work means additional safety measures are in place. One being social distancing; i.e., at least within 6ft.
This requirement alone puts constraints on the amount of labor you can have onsite, at any point; thus, overall delays. As contractors are trying to see if, in fact, this event falls under force majeure language/if their contracts have a force majeure clause under which it might give them time extensions.
What it does not specify is if there is any monetary relief. For those that do private work under the AIA a201 documents, as of last week they did provide specific information on the question of coverage for COVID-19, they inserted a new clause, 8.3.4:
“Owner and Contractor recognize the existing and potential extraordinary measures being taken by governments, companies, and individuals due to COVID-19 and the potential impacts from the same on this Project. Owner shall not be liable to Contractor for extended overhead or any other delay damages, and the GMP shall not be increased, due to shortage of labor, materials or other causes of COVID-19.”
Nor surprising that no one wants the responsibility of this unknown catastrophe. With no definitive repercussions, no one party should take that on. This is an unfortunate, uncontrollable instance.
No one party can sustain taking on all this risk nor should they. Since this is an “everyone” type of problem that is how a solution should also be handled, by everyone. No one will be unscathed from the toll this has and will take on most business.
As previously mentioned there are a lot of organizations supporting the construction industry and COVID-19, via information, AGC and FMI have been extremely active with webinars providing as much information and as frequently as it comes in.
What all stress is you need to be as communicative as you can possibly be. All are exposed here and the only way to minimize the stress of the situation is by trying to help one other.
That means equal communication downstream as well as upstream. Can’t stress enough how little it does for anyone party to push off their loss onto another party.
Once we are past this disaster we will be announcing a new date for the job fair. Looks like the construction industry will be in more need than initially anticipated.