How are subcontract variations valued under JCT? Under JCT Design and Build Subcontract terms (such as DBSub/C Section 5), variations are valued using subcontract bill rates where the work is of similar character and executed under similar conditions (Clauses 5.6 to 5.12). Daywork provisions (Clause 5.9) apply according to the signed subcontract terms and any bespoke amendments.
Executing varied work on site is standard practice across UK commercial projects. However, agreeing on the financial valuation of that work often leads to commercial friction. If contractor commercial teams are re-measuring submitted daywork sheets against baseline tender rates, understanding JCT DBSub/C valuation rules is vital to defend against subcontract revenue loss.
1. Technical Authority: Subcontract Valuation Provisions (DBSub/C)
In the JCT Design and Build Subcontract (DBSub/C 2016/2024), variation provisions are established in Section 5. The valuation rules themselves are contained in Clauses 5.6 to 5.12, with specific terms governing Daywork under Clause 5.9:
- Subcontract Rates Baseline: Work of similar character executed under similar conditions is valued at the rates set out in the Subcontract Bill or Schedule of Rates.
- Fair Allowance Adjustments: If varied work is not of similar character or is executed under different conditions, the contract rates form the basis, with a fair allowance added or deducted for the difference.
- Daywork Entitlement (Clause 5.9): Daywork application depends on the signed subcontract terms and pricing schedules. It typically applies where work cannot properly be valued by measurement.
- Loss and Expense Separation: Prolongation and disruption costs caused by altered sequences must be claimed separately under Clauses 4.14 to 4.18. Do not assume valuation of work automatically covers delay costs.
2. Directions and Contemporaneous Evidence on Site
On site, work often begins following a verbal instruction. In standard DBSub/C forms, directions given other than in writing are addressed under Clause 3.7, which outlines the procedure for confirming oral directions.
Submitting a written Confirmation of Verbal Instruction (CVI) provides vital contemporaneous evidence of the date, scope, and direction given. However, a CVI record does not by itself prove the person was authorised to issue instructions, establish that the work is an agreed variation, or guarantee acceptance of your valuation.
3. Practical Steps to Protect Variation Valuations
- Record Details Contemporaneously: Record who gave the direction, their authority, the date, location, and specific scope before undertaking work.
- Follow Subcontract Confirmation Terms: Request written confirmation using the exact procedure set out in Clause 3.7 of your signed subcontract.
- Maintain Daily Resource Sheets: Keep contemporaneous records of plant, labour, and materials used, even if the valuation basis remains subject to agreement.
- Serve Separate Delay Notices: If a variation affects your critical path, serve a formal notice of delay under Clause 2.17. An instruction record does not satisfy delay notice obligations.
Document Site Directions Contemporaneously
Before submitting variation valuations under JCT DBSub/C Section 5, ensure your directions are backed by written records. Generate a clear confirmation record draft to keep a formal project trail under Clause 3.7.
Frequently Asked Questions: Subcontract Valuation Rules
Which clauses govern variation valuations in JCT DBSub/C?
Under the JCT Design and Build Subcontract (DBSub/C 2016/2024), variation valuation rules are detailed across Clauses 5.6 to 5.12, with daywork provisions addressed under Clause 5.9.
Does issuing a CVI guarantee payment for variation works?
No. A Confirmation of Verbal Instruction provides valuable contemporaneous evidence of what occurred on site, but it does not by itself establish contractual entitlement or override the specific valuation mechanisms in your executed subcontract.