Extension of Time (EOT) claims are a critical part of construction project management. When handled correctly, they help protect contractors from unfair delay penalties and allow projects to proceed with realistic timelines. However, when EOT claims are mishandled, they often become a major source of dispute, cost overruns, and strained relationships.
Below are some of the most common pain points that arise when EOT claims are not managed properly.
- Rejection of Legitimate Delay Claims
One of the biggest challenges contractors face is the rejection of valid EOT claims due to incomplete documentation, late submissions, or failure to follow contractual procedures. Even genuine delays caused by variations, late approvals, or unforeseen conditions may be dismissed if the claim lacks proper substantiation.
Impact:
- Loss of entitled time extension
- Exposure to liquidated damages
- Increased financial risk for contractors
- Poor Delay Records and Documentation
EOT claims rely heavily on accurate project records such as daily reports, progress schedules, correspondence, and site instructions. Poor record-keeping makes it difficult to demonstrate cause-and-effect relationships between delays and their impacts.
Impact:
- Weak claim credibility
- Lengthy disputes during claim evaluation
- Difficulty defending claims during arbitration or litigation
- Missed Contractual Notice Requirements
Most contracts require timely notice of delay events. When these notice provisions are overlooked or misunderstood, employers may argue that the contractor has waived their right to claim an extension of time.
Impact:
- Claims rejected on technical grounds
- Loss of contractual entitlement
- Increased project tension and mistrust
- Inaccurate Delay Analysis
Improper or overly simplistic delay analysis methods can lead to incorrect conclusions about responsibility and time impact. Failure to use accepted methodologies such as Critical Path Method (CPM) analysis weakens the claim’s technical foundation.
Impact:
- Disputes over responsibility for delays
- Conflicting interpretations between parties
- Prolonged claim assessment periods
- Escalation of Disputes and Claims
When EOT claims are mishandled, what could have been a straightforward time adjustment often escalates into formal disputes. These disputes consume significant management time and can damage long-term business relationships.
Impact:
- Increased legal and consultancy costs
- Project delays due to unresolved claims
- Strained employer–contractor relationships
- Negative Cash Flow and Project Performance
Rejected or delayed EOT approvals can result in contractors accelerating works to avoid penalties, often at additional cost. This affects cash flow, productivity, and overall project performance.
Impact:
- Unplanned acceleration costs
- Reduced profitability
- Increased pressure on site teams
Conclusion
Mishandling EOT claims can have far-reaching consequences beyond just time adjustments. Proper planning, timely notices, accurate records, and robust delay analysis are essential to protecting project interests and maintaining healthy contractual relationships.
Engaging experienced project controls or claims professionals can help ensure EOT claims are prepared, assessed, and resolved fairly—minimizing disputes and supporting successful project delivery.
Categories
- Project Planning
- Project Initiation
- Monitoring and Controlling
