Construction projects that shut down production in the short term deserve careful consideration when it’s time to restart operations. Contractors must recognize the need to create a plan for resuming work after interruptions such as the global coronavirus pandemic or other events.
In a perfect world, projects would continue exactly where they left off, with no disruption. But in reality, a construction project is a lot like a train when it comes to starting and stopping: it takes considerable time and energy to restore momentum, especially after a complete stop.
States may provide specific health and safety guidelines for construction industries to begin work again. Construction contractors that have a proactive and comprehensive approach to project restarts will be the most successful at avoiding negative effects from the shutdown.
Consider these questions as your company and project teams formulate a restart strategy:
- What is the financial status of the project? Has there been a discussion with the owner? What about the lender? What is the status of previous pay applications?
- Are you outlining and documenting project shutdown costs and restart costs? What is the status of the General Conditions on this project? Are there cost allocation codes delineated for COVID-related expenses? What about remobilization costs?
- What governmental or special inspections are pending? Have local, state or federal officials, in their respective building departments, been laid off or furloughed? What is the current backlog of inspections?
- What planning and permitting needs are outstanding? If your project is seeking permit approvals for specific phases of the project or the entire project, how long is that delayed? What is your status within the queue?
- How are the product and material supply chains? Where does your project long-lead items stand? Are there new critical path items that were not contemplated? Are there raw material shortages that impact your project?
- Do you face workforce pool disruption? Which trade partners or subcontractors may present concerns in maintaining or accelerating your project? Which contractors are at risk due to supply chain disruptions?
- Have you scheduled restart meetings with subcontractors? Restart meetings should be prioritized by subcontractor, but also by the potential impact of their products – or lack of product – to the project schedule. Consider inviting key suppliers and manufacturers to restart meetings.
- How will daily worker count and identification be documented once work begins? Will worker movements be tracked?
- What is the status of personal protection equipment on the project site? Do you have subcontractor PPE? If inadequate PPE is available, will engineering controls need to be implemented to eliminate the hazard?
- What is the next major milestone on the critical path? What is the status of the schedule as operations resume? Has there been formal communication on time extensions, if needed? Is the original project completion date unchanged?
- What is the status of all outstanding requests? Where do you stand on requests for information, architectural supplemental instructions, change orders and submittals? Are there specific items outstanding? What is the timeline to complete or expedite?
- What is the state of any potential delay claims? Have there been formal discussions with the owner and lender? Have you notified your Builders’ Risk insurance carrier? How are delay-related costs being identified and tracked, separate from normal construction operations?
In the case of a widespread disruption such as the pandemic, consider that your project will be restarting with all other projects across the United States – simultaneously. This could create its own speedbumps.
The long-term effects of this pandemic are yet to be known, but contractors with a sound strategy toward restarting operations will be the key to their companies’ future successes.
This loss control information is advisory only. The author assumes no responsibility for management or control of loss control activities. Not all exposures are identified in this article. Contact your local, independent insurance agent for coverage advice and policy service. Neither The Cincinnati Insurance Company nor its affiliates or representatives offer legal advice. Consult with your attorney about your specific situation.