Acceleration Claims

• Published date: 23 December 2021
• Subject Matter: Employment and HR, Real Estate and Construction, Employee Benefits & Compensation, Construction & Planning
• Law Firm: MMA Law
• Author: MMA Law

An acceleration of a construction project defines the situation when work is performed at a faster pace than initially planned. In most cases, acceleration is needed to counteract accumulated delays and to meet the agreed completion date. Acceleration can also occur when the contractor has a direct interest in seeing a project completed ahead of schedule - either by receiving a performance bonus or by relocating resources to another project. The contractor can accelerate work on a project by requesting its workers to perform overtime, by adding a new shift, hiring additional labour, subcontracting, or changing the sequence of activities. Whatever method is chosen, it comes with extra costs that can or cannot be later recovered. Accelerating the project schedule is never free. In addition, when the acceleration is sudden, labour productivity decreases substantially because of fatigue (for current workers required to do overtime) or unfamiliarity to the project (new workers).

There are three types of acceleration that are different based on their causes: Voluntary Acceleration, Directed Acceleration, and Constructive Acceleration.

Voluntary Acceleration describes the situation when the contractor unilaterally takes the initiative of speeding up work on-site, without being previously asked by the owner to do so. This can result in costs that go beyond the original bid and which won't be recovered unless the client is notified and agrees with the acceleration. Reasons for a client to accept a voluntary acceleration mostly relate to the ability to generate revenue faster by selling, letting, or starting production, which can counterweight the increase in construction costs.

Directed Acceleration is the simplest and most straightforward case of speeding up the construction schedule. The client requests the contractor to accelerate work and pays for the acceleration costs. Such a situation won't lead to disputes if parties agree on the magnitude of additional costs.

Constructive Acceleration is a situation that is not explicitly voluntary nor directed. Constructive Accelerations typically occur when the contractor is able to invoke an excusable delay such as design changes, added scope, extreme weather, site conditions that differ from bidding specifications, or force majeure events. Owner-caused delays also qualify to justify a constructive acceleration, as well as any other factors beyond the contractor's control that couldn't be initially assessed as risks.

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