In episode 123 of The Subcontractors Blueprint podcast, host Jacob Austin provides construction business owners with practical guidance on managing compensation event clauses under NEC contracts. He explains the crucial differences between early warnings and compensation events, outlines notification and quotation procedures, and emphasises the importance of timely communication, thorough record-keeping, and contract compliance. Using real-world examples, Jacob demonstrates how proactive management of these clauses can protect subcontractors’ interests, improve cash flow, and foster collaborative relationships with contractors—ultimately supporting business growth and successful project delivery.

KEY TAKEAWAYS:

• The episode explains the difference between early warnings and compensation events in NEC contracts, emphasising their roles in proactive risk management.
• Early warnings are about flagging potential risks before they happen, while compensation events address actual changes that impact time or cost.
• Failing to issue early warnings can result in reduced compensation, as contractors may assess claims as if warnings had been given.
• Strict notification and time bar requirements mean subcontractors must act quickly and provide clear evidence to protect their entitlements.
• Compensation events are assessed based on defined costs, and well-prepared, transparent quotations are essential for successful claims.
• Collaboration, clear communication, and following contract processes are key to avoiding disputes and ensuring fair outcomes on NEC projects.

BEST MOMENTS:

"The principle behind [Early Warnings] is that it's a proactive risk management tool to flag up issues that could impact time, cost and quality."

"Early warnings are future events—they may happen or they might not. Compensation events are guaranteed to happen."

"Compensation events are assessed on the basis of defined cost, which is essentially the reasonable cost that you incur yourself, plus an applicable fee."

"A well-prepared quote is critical. It needs to be clear with breakdowns of your labor, plant, materials, and descriptions of how it's been calculated."

"The point is to create early and binding agreements as you go throughout the contract, to avoid the need for lengthy disputes and final account meetings."

"The straight talking truth is that compensation events can become contentious if people can't get around the table and talk sense and come to sensible agreements."

Jacob is on a mission to help the 1 million SME contractors working within the construction industry. If you've taken something of value from this episode, please share the podcast with someone you know, and pass the value on.

HOST BIO: Meet Jacob Austin, a Chartered Quantity Surveyor with a rich background at construction industry giants Balfour Beatty, Kier, and Vistry Group. With extensive involvement in education, health, and residential projects spanning various scales, from £1000s to over £100M in concurrent developments, Jacob brings a unique perspective. Having collaborated with numerous small businesses, he's now committed to sharing his expertise to drive their success. Join Jacob on his podcast, where he blends his profound insights and personable approach to offer guidance, industry secrets, and inspirational stories.

LinkedIn - www.linkedin.com/in/jacob-austin/

Instagram - www.instagram.com/qs.zone/

www.qs.zone/all-links

In episode 122 of The Subcontractors Blueprint podcast, host Jacob Austin guides construction business owners through the payment mechanisms of NEC subcontract agreements, focusing on the 50 series clauses. He explains the importance of assessment dates, compliant payment applications, and the impact of main option clauses (A–E) on cash flow. Jacob highlights that contract amendments that can complicate payments and shares a practical checklist for managing the payment process. The episode offers actionable advice to help subcontractors protect their cash flow, avoid payment disputes, and ensure profitability under NEC contracts.

KEY TAKEAWAYS:

• The NEC subcontract’s payment process is strictly tied to assessment dates, requiring timely and compliant applications for payment.
• Missing an application deadline or submitting a non-compliant claim can result in receiving no payment or even owing money due to contract clauses like 50.4.
• Different NEC main options (A–E) significantly affect how payments are calculated, from activity schedules to bills of quantities and cost-reimbursable models.
• Maintaining clear records and collaborating with the main contractor is crucial, especially for measurement and cost-based payment options.
• The UK Construction Act (via clause Y(UK)2) mandates fixed payment timelines and defines payment notice requirements, overriding variable invoice-based systems.
• Careful contract administration, matching application formats, and assertively managing payment schedules are essential to protect subcontractor cash flow.

BEST MOMENTS:

"The NEC payment process is only fair if you run it properly and it can punish you with cash flow problems if you don't."

"If your application is non-compliant, you're basically volunteering not to be paid."

"Clause 50.4, The Quiet Assassin...if you miss your application date, you don't just get paid slightly late because you applied late. The contract says that you get nothing."

"Defined cost can be weaponised via audits if you don't have good records of what people were doing and when they were doing it."

"A defective notice could mean that you're entitled to full payment of your application without any deduction."

Jacob is on a mission to help the 1 million SME contractors working within the construction industry. If you've taken something of value from this episode, please share the podcast with someone you know, and pass the value on.

HOST BIO: Meet Jacob Austin, a Chartered Quantity Surveyor with a rich background at construction industry giants Balfour Beatty, Kier, and Vistry Group. With extensive involvement in education, health, and residential projects spanning various scales, from £1000s to over £100M in concurrent developments, Jacob brings a unique perspective. Having collaborated with numerous small businesses, he's now committed to sharing his expertise to drive their success. Join Jacob on his podcast, where he blends his profound insights and personable approach to offer guidance, industry secrets, and inspirational stories.

LinkedIn - www.linkedin.com/in/jacob-austin/

Instagram - www.instagram.com/qs.zone/

www.qs.zone/all-links

In episode 121 of The Subcontractors Blueprint podcast, host Jacob Austin continues the NEC contracts mini-series, providing construction business owners with practical guidance on managing NEC subcontracts. This week he explains the importance of time risk allowances (TRAs) and different types of float—free, total, and terminal—clarifying their roles, ownership, and impact on scheduling and compensation events. Jacob emphasises maintaining an up-to-date, accepted programme as a vital tool for managing risk, demonstrating entitlement to extensions of time, and minimising disputes. The episode offers actionable insights to help subcontractors protect their interests and improve project outcomes under NEC contracts.

KEY TAKEAWAYS:

• Time risk allowances (TRAs) are essential in NEC programmes, acting as subcontractor-owned buffers for managing their own risks.
• TRAs must be clearly shown and allocated to specific activities rather than added as a lump sum, ensuring realistic and accepted project schedules.
• Float is divided into total, free, and terminal types, with total and free float being shared resources and terminal float exclusively benefiting the subcontractor.
• Regularly updating and gaining acceptance for the programme transforms it into both a management tool and a contractual benchmark for assessing delays and compensation events.
• Maintaining an accurate, accepted programme strengthens a subcontractor’s negotiating position, protects entitlements, and helps prevent disputes.
• Treating the programme as a living document enables proactive risk management, clear demonstration of progress, and fair compensation for delays.

BEST MOMENTS:

"A program with zero allowances is likely to be optimistic and could be deemed not practicable or unrealistic, and that is a reason for non acceptance of your programme.”

"By showing TRA, you're demonstrating that you built in time buffers for your own risks and thereby increase the confidence that plan completion can be achieved by the date you're saying."

"A well maintained programme also builds your credibility. If the contractor sees that each update is thorough and good and honest, not only are they more likely to accept them without a dispute, but it means when it comes to assessing a compensation event, they're more likely to trust your assessment of it."

"The NEC mantra is that the programme is a management tool, not just a contract requirement."

"If you treat the programme as your friend, invest time in it, invest effort in it, then it will pay you back by minimising disputes and helping you to secure your entitlements against changes."

Jacob is on a mission to help the 1 million SME contractors working within the construction industry. If you've taken something of value from this episode, please share the podcast with someone you know, and pass the value on.

HOST BIO: Meet Jacob Austin, a Chartered Quantity Surveyor with a rich background at construction industry giants Balfour Beatty, Kier, and Vistry Group. With extensive involvement in education, health, and residential projects spanning various scales, from £1000s to over £100M in concurrent developments, Jacob brings a unique perspective. Having collaborated with numerous small businesses, he's now committed to sharing his expertise to drive their success. Join Jacob on his podcast, where he blends his profound insights and personable approach to offer guidance, industry secrets, and inspirational stories.

LinkedIn - www.linkedin.com/in/jacob-austin/

Instagram - www.instagram.com/qs.zone/

www.qs.zone/all-links

In episode 120 of The Subcontractors Blueprint podcast, host Jacob Austin continues the NEC contracts mini-series, providing construction business owners with a comprehensive guide to program clauses under NEC4 subcontracts. He explains the critical requirements for program submission, acceptance, and ongoing updates, highlighting their impact on cash flow, entitlement protection, and project management. Jacob discusses practical strategies for ensuring compliance, avoiding payment penalties, and maintaining control over compensation events. This episode is essential listening for subcontractors seeking to strengthen their NEC4 contract administration and safeguard their business interests.

KEY TAKEAWAYS:

• The critical role of the program in NEC4 subcontracts, detailing how it underpins project planning, change management, and subcontractor protection.
• NEC4 requires programs to include key dates, milestones, logical sequencing, float, time risk allowances, and necessary inputs from other parties.
• The distinction between planned completion and contract completion dates is emphasised, with terminal float serving as a buffer for subcontractors.
• Submitting a compliant program on time is essential, as failure to do so allows the contractor to withhold 25% of payments until an acceptable program is provided.
• Program acceptance and rejection are governed by strict contractual criteria, and deemed acceptance occurs if the contractor fails to respond within set timeframes.
• Regular program updates are required to reflect progress, changes, and delays, ensuring the program remains a reliable management tool and protects subcontractor entitlements.

BEST MOMENTS:

“A well-managed program, and an accepted program, is absolutely central to administering the subcontract. It sets out how and when the work will be done.”

“If there’s no current accepted program, the assessment of compensation events may be taken out of your hands—potentially leading to smaller time and cost compensation.”

“By including key dates and requirements in your program, you are creating hooks within your program that the contractor or whoever else is going to snag on if they miss those dates.”

“Acceptance of a program doesn’t stop you from having to achieve any of your obligations, and it doesn’t transfer any risk of those to the contractor.”

“The goal here is to create a program that’s got clear and common reference points for both parties- it allows the contractor to verify the feasibility of your program and to see your needs and your constraints.”

Jacob is on a mission to help the 1 million SME contractors working within the construction industry. If you've taken something of value from this episode, please share the podcast with someone you know, and pass the value on.

HOST BIO: Meet Jacob Austin, a Chartered Quantity Surveyor with a rich background at construction industry giants Balfour Beatty, Kier, and Vistry Group. With extensive involvement in education, health, and residential projects spanning various scales, from £1000s to over £100M in concurrent developments, Jacob brings a unique perspective. Having collaborated with numerous small businesses, he's now committed to sharing his expertise to drive their success. Join Jacob on his podcast, where he blends his profound insights and personable approach to offer guidance, industry secrets, and inspirational stories.

LinkedIn - www.linkedin.com/in/jacob-austin/

Instagram - www.instagram.com/qs.zone/

www.qs.zone/all-links

In episode 119 of The Subcontractors Blueprint podcast, host Jacob Austin continues the NEC contracts mini-series, focusing on key obligations for subcontractors. He explains the importance of acting in a spirit of mutual trust and cooperation, details core responsibilities under the 10, 20, and 40 series clauses—including quality management, design duties, and defect handling—and emphasises proactive communication and collaboration. Jacob also provides practical guidance on defect management, highlighting the impact on client satisfaction and future business. The episode offers clear, actionable advice to help construction business owners protect profitability and maintain strong contractor relationships.

KEY TAKEAWAYS:

• The NEC contract’s foundation is acting as stated in the contract and in a spirit of mutual trust and cooperation, requiring both strict compliance and collaborative problem-solving.
• Subcontractors must deliver all works as defined in the scope, including any design responsibilities, key personnel, and coordination with others as specified.
• Meeting key dates is critical, as missing them can lead to liability for additional costs or delays impacting other trades.
• Subcontracting parts of the work requires contractor approval, and the main contractor manages you—not your sub-subcontractors.
• A robust quality management system is mandatory, with clear procedures for inspections, testing, and defect correction as outlined in the contract and scope.
• Defects must be reported and corrected within specified periods, with uncorrected defects potentially leading to deductions or negotiated credits, emphasising the importance of proactive communication and client satisfaction.

BEST MOMENTS:

"The NEC’s core principle is that parties act as stated in the contract and in a spirit of mutual trust and cooperation."

"Mutual trust and cooperation means openness, fairness, and tackling problems together—not hiding bad news or exploiting loopholes."

"Key dates are critical—miss one, and you could be liable for the contractor’s extra costs or delays to other trades."

"A quality management system isn’t optional; you must have documented procedures for inspections, testing, and approvals."

"Defects must be reported and corrected promptly—unfixed defects can lead to deductions or negotiated credits, impacting your reputation and payment."

Jacob is on a mission to help the 1 million SME contractors working within the construction industry. If you've taken something of value from this episode, please share the podcast with someone you know, and pass the value on.

HOST BIO: Meet Jacob Austin, a Chartered Quantity Surveyor with a rich background at construction industry giants Balfour Beatty, Kier, and Vistry Group. With extensive involvement in education, health, and residential projects spanning various scales, from £1000s to over £100M in concurrent developments, Jacob brings a unique perspective. Having collaborated with numerous small businesses, he's now committed to sharing his expertise to drive their success. Join Jacob on his podcast, where he blends his profound insights and personable approach to offer guidance, industry secrets, and inspirational stories.

LinkedIn - www.linkedin.com/in/jacob-austin/

Instagram - www.instagram.com/qs.zone/

www.qs.zone/all-links

In episode 118 of The Subcontractors Blueprint podcast, host Jacob Austin launches a mini-series on the NEC4 suite of contracts, focusing on the engineering and construction subcontract “ECS”. He explains the contract’s structure, main and secondary option clauses, and their impact on risk, pricing, and delivery. Jacob provides a practical checklist to help subcontractors review NEC4 subcontracts, emphasising the importance of understanding triggered clauses, design obligations, liability caps, and payment terms. This episode equips construction business owners with essential knowledge to manage contractual risks, protect profitability, and ensure project success under NEC4.

KEY TAKEAWAYS:

• The NEC4 Engineering and Construction Subcontract (the "ECS”) closely mirrors the main contract, providing consistency and back-to-back risk management throughout the supply chain.
• Subcontractors must understand which main option (A–E) is used, as it fundamentally changes the allocation of risk and payment mechanisms.
• Secondary option clauses (W, X, Y, Z) tailor the contract to specific scenarios, and subcontractors need to review these carefully to understand their obligations and risks.
• Key processes like early warning and compensation events are designed to align with the main contract, promoting collaboration and timely communication.
• Subcontractors should always review the contract data and option clauses in detail to ensure their price and approach reflect all risks and requirements before signing.
• The NEC4 approach is user-friendly and flexible, but its customisability demands careful attention to detail to avoid unexpected liabilities.

BEST MOMENTS:

“As a subcontractor, you're operating in a framework that talks back to the main contract and feeds in to the main contractor's obligations to their client, so it reduces surprises and mismatches in timescales and obligations.”

“The most collaborative tool within the main contract, the early warning process, is flowed down to you as a subcontractor as well.”

“As you go through the options from A to E, you start with a situation where the subcontractor holds the biggest amount of risk through to option E, where the subcontractor holds the least amount of risk.”

“It would certainly be sensible to discuss before you set off down a road that you both struggle to get to the end of, but you need to understand with this, the option isn't just a letter. It completely changes the feel and the nature of the subcontract.”

“It's important that you appreciate what those letters and numbers mean because when you read the subcontract data for an NEC contract, it will list out all of the option clauses that apply to that particular subcontract.”

Jacob is on a mission to help the 1 million SME contractors working within the construction industry. If you've taken something of value from this episode, please share the podcast with someone you know, and pass the value on.

HOST BIO: Meet Jacob Austin, a Chartered Quantity Surveyor with a rich background at construction industry giants Balfour Beatty, Kier, and Vistry Group. With extensive involvement in education, health, and residential projects spanning various scales, from £1000s to over £100M in concurrent developments, Jacob brings a unique perspective. Having collaborated with numerous small businesses, he's now committed to sharing his expertise to drive their success. Join Jacob on his podcast, where he blends his profound insights and personable approach to offer guidance, industry secrets, and inspirational stories.

LinkedIn - www.linkedin.com/in/jacob-austin/

Instagram - www.instagram.com/qs.zone/

www.qs.zone/all-links

In episode 117 of The Subcontractors Blueprint podcast, host Jacob Austin provides UK construction business owners with a clear, practical overview of the Housing Grants, Construction and Regeneration Act and the Scheme for Construction Contracts. He explains key protections for subcontractors, including rights to interim payments, payment notices, pay less notices, suspension for non-payment, and fast-track dispute resolution through adjudication. Jacob emphasises the importance of written contracts but reassures listeners that statutory rights apply even without one. This episode empowers subcontractors to secure timely payments, maintain healthy cash flow, and confidently handle disputes in the UK construction industry.

KEY TAKEAWAYS:

• The Construction Act and the Scheme for Construction Contracts provide crucial legal protections for UK subcontractors, ensuring fair and prompt payment.
• Subcontractors are entitled to interim payments, clear payment notices, and protection from unfair payment delays or reductions.
• Contractors must issue timely payment and pay less notices, or else the subcontractor is entitled to the full amount claimed.
• Subcontractors have the right to suspend work for non-payment and can claim extensions of time and reasonable costs for remobilisation.
• Statutory adjudication offers a fast-track, cost-effective way to resolve payment and contract disputes, even for oral agreements.
• "Pay when paid" clauses are generally outlawed, ensuring subcontractors are not left waiting for payment due to issues higher up the supply chain.

BEST MOMENTS:

"If the contractor misses that window or fails to issue a valid Payless notice, they can't by law short to pay you. And the law is really clear on that."

"The law says that you can [suspend work for non-payment] without liability, meaning you won't be in breach of contract for stopping work in those circumstances."

"Adjudication can be a game changer for subcontractors because it embodies that pay now, argue later ethos that we mentioned earlier by giving you a way to quickly secure payment or resolve disputes."

"The Construction Act outlaws that, and any provision that makes your payment conditional on receipt of payment from a third party is ineffective."

"Knowing these rules and asserting them at the right time will help you to ensure you get fully paid and on time for the work that you do."

Jacob is on a mission to help the 1 million SME contractors working within the construction industry. If you've taken something of value from this episode, please share the podcast with someone you know, and pass the value on.

HOST BIO: Meet Jacob Austin, a Chartered Quantity Surveyor with a rich background at construction industry giants Balfour Beatty, Kier, and Vistry Group. With extensive involvement in education, health, and residential projects spanning various scales, from £1000s to over £100M in concurrent developments, Jacob brings a unique perspective. Having collaborated with numerous small businesses, he's now committed to sharing his expertise to drive their success. Join Jacob on his podcast, where he blends his profound insights and personable approach to offer guidance, industry secrets, and inspirational stories.

LinkedIn - www.linkedin.com/in/jacob-austin/

Instagram - www.instagram.com/qs.zone/

www.qs.zone/all-links

In episode 116 of The Subcontractors Blueprint podcast, host Jacob Austin explains the importance of the "golden thread"—a comprehensive digital record of building information now required under the Building Safety Act 2022. Using a real-world example, he highlights the risks of poor documentation and offers practical tips for subcontractors to organise, manage, and hand over essential compliance documents. Listeners learn what information to provide, legal obligations, and how embracing these practices not only ensures building safety and timely payments but also strengthens relationships with main contractors and secures future work.

KEY TAKEAWAYS:

• The golden thread is a comprehensive, digital, and legally required record of building information, ensuring compliance, safety, and accountability throughout a project’s lifecycle.
• Subcontractors must provide accurate, up-to-date documentation such as as-built drawings, product data, test certificates, O&M manuals, and records of design changes to support project handover.
• Failing to maintain the golden thread can delay project completion, final payments, and legal building occupation, impacting both reputation and business relationships.
• The golden thread is expanding beyond high-rise residential projects, with many clients and contractors now treating it as best practice across all sectors.
• Effective golden thread management involves early organisation, clear communication with your supply chain, leveraging digital tools, and following main contractor requirements.
• Proactive, quality handover documentation not only ensures compliance but also builds trust and increases the likelihood of repeat work from main contractors.

BEST MOMENTS:

"The golden thread, essentially a comprehensive digital trail of building information, is evidence that your work complies with building regulations."

"No structured handover = no completion certificate = no legal occupation."

"The golden thread demonstrates first with the design, that the design is compliant, backed up by relevant specifications and performance data through the install."

"The golden thread isn't just about bureaucratic red tape—it's about instilling accountability and pride in everybody's work."

"Main contractors will start to remember the subcontractors who hand over quality information first time and without a fight."

Jacob is on a mission to help the 1 million SME contractors working within the construction industry. If you've taken something of value from this episode, please share the podcast with someone you know, and pass the value on.

HOST BIO: Meet Jacob Austin, a Chartered Quantity Surveyor with a rich background at construction industry giants Balfour Beatty, Kier, and Vistry Group. With extensive involvement in education, health, and residential projects spanning various scales, from £1000s to over £100M in concurrent developments, Jacob brings a unique perspective. Having collaborated with numerous small businesses, he's now committed to sharing his expertise to drive their success. Join Jacob on his podcast, where he blends his profound insights and personable approach to offer guidance, industry secrets, and inspirational stories.

LinkedIn - www.linkedin.com/in/jacob-austin/

Instagram - www.instagram.com/qs.zone/

www.qs.zone/all-links