Welcome to Part 3 of Tricks of the Trade - the series dedicated to helping construction and field service companies tackle their day to day challenges 🛠️

In this segment, we are going to take a close look at Early Warning Notices (EWNs) and their role in NEC contracts. We aim to shed light on how they can be used effectively to manage risks and keep projects on track. Whether you're new to EWNs or looking to refine your approach, this blog will help you navigate the key aspects with ease. We’ve also included a practical template of an Early Warning Notice to help you get ahead of the curve. Let’s dive in and explore how to make the most of this tool!

What is an Early Warning Notice (EWN)? 🤔

An early warning is a proactive notification raised by either the Project Manager or Contractor to highlight an issue that could affect cost, time or quality. Specifically, both parties (Contractor and Project Manager) are required to issue early warnings as soon as they become aware of any issue that could:

Increase the total cost of the prices
Delay completion
Delay meeting a key date
Impair the performance of the works in use
Increase the contractor's total price

Early warnings notices are a requirement in the clauses 15.1 NEC4 & 16.1 NEC3.

Issuing an Early Warning Notice 📋

Early warnings should be raised as soon as the issue is identified. Failure to do so can result in increased costs & disputes later on. Firstly, when identifying the issue, it's important to establish how it will affect the project in terms of cost, time and/or money. The other party should be notified in writing of the following:

Clear issue description
How it may affect the project
Severity of the risk
Suggested solutions/ required actions

Here is a free template of an EWN, complete with an example of a situation where an EWN would be issued.

Encouraging open communication among the parties, EWNs establish an environment where problems can be addressed collaboratively between stakeholders. It's important to remember that issuing an EWN should not be for the purpose of allocating responsibility or liability. Instead, the focus should be on agreeing on the necessary steps to resolve the matter.

As a tool of mutual benefit to both parties, the purpose of notifying issues early is to help manage and minimise their impact. Once an early warning is issued, an early warning meeting is held to discuss the issue and decide on the necessary steps to take. The Project Manager updates the Early Warning Register - a live summary of all warnings raised on a project - to keep tabs on progress and actions.

Quick Aside ...👀

There is no direct connection between early warnings and compensation events. An early warning doesn't necessarily result in a compensation event and a compensation event may not require an early warning. However, early warnings can impact the assessment of compensation events if they stem from the same issue later on.

Benefits of EWNs

Save time, money, and minimise disputes
Identifying risks early reduces the likelihood of disputes, as stakeholders can be informed and prepared to address challenges before they become major issues. This leads to smoother project execution and fewer surprises, helping everyone involved stay on track and aligned with the project goals.

Catalyst for growth
With a collaborative approach, the team remains adaptable to change. When stakeholders and team members align and work towards a common goal, the collaboration can act as a catalyst for overall growth, both for the project and the business as a whole.

No Division
Team members are more likely to work together harmoniously, creating a unified approach to problem-solving and decision-making. This helps avoid any "us vs. them" mentality, promoting teamwork instead of division.

Informed Decision Making
When everyone is on the same page and has a clear understanding of the risks, potential impacts, and available solutions, decisions are made with greater confidence. This leads to better outcomes, as decisions are based on a comprehensive view of the situation, incorporating insights from various stakeholders.

Closing Thoughts on Early Warning Notices

Early Warning Notices are a vital tool for managing risk and ensuring the smooth progress of construction and field service projects under NEC contracts. By proactively identifying and addressing potential issues related to cost, time, or quality, EWNs foster clear communication and collaboration between contractors and project managers. This early intervention not only helps to minimise delays and additional costs but also creates a culture of teamwork and informed decision-making.

With the inclusion of a practical template, this guide aims to equip you with the knowledge to use EWNs effectively, ultimately contributing to the successful delivery of your projects. Embracing EWNs as part of your toolkit ensures that risks are managed and projects remain on track.

That concludes part 3 of Tricks of the Trade! Stay tuned as we have plenty more tricks (excuse the pun) up our sleeves! If you didn't get the chance to check out Part 2 which dives into the best practices for managing spread out teams - click here. What’s up next? Tune in for the interesting topic that awaits in part 4... 💸👀