Establishing a clear definition of the scope of engineering services required for a particular project is often difficult, but nonetheless, it is the single most important step in contracting for engineering services. Developing a good scope of work description clarifies for the Owner just what the real extent of the project is and what type and level of services are appropriate to complete it. It allows the engineer to understand what services he or she is expected to provide and establishes fair guidelines for comparing one firm's services to another. The Scope of Services will form the basis of the contractual relationship between engineer and owner throughout the project and will likely be referred to by both parties frequently as the project proceeds. If it is clear and concise, it will engender confident, constructive actions by both parties as they move forward with the project. However, if it is vague, poorly worded, or too general it can be a continual source of confusion, misunderstandings and possible ill will. Investing time "up front" in a well thought out, well written scope of services description will pay off many times over. The scope of services is best developed jointly by the owner and the engineer when reviewing the unique needs of the project.
The first step in defining the scope of services is for the owner to clearly identify what his or her needs are, and how the project is expected to meet those needs. Establishing a realistic project budget and timetable are also essential. These early, "big picture" aspects of the project warrant careful attention by the owner's most senior management. If the owner does not have sufficient expertise or resources to perform these tasks properly, he should retain the necessary consultants to assist in the process. In some cases it will be necessary to establish a study and report phase as this initial step in to analyze the owners needs and establish parameters for the "real" project that will follow.
While the owner is the only one who can identify what he really needs or wants out of a project, defining the specific steps to achieve those goals may be beyond his expertise. Fortunately, there are several excellent guides available from ACEC to assist in setting a detailed scope of services for specific portions of a project. These include the:
Geotechnical Engineering Scope of Services: prepared by the Geotechnical Coalition of ACEC/CT.
National Practice Guidelines for the Structural Engineer of Record: prepared by the Coalition of American Structural Engineers (CASE), a coalition of the American Council of Engineering Companies.
Mechanical / Electrical Scope of Services: prepared by the Mechanical/Electrical Coalition of ACEC/CT.
Use these guidelines as a starting point. The final scope of services description that appears in the contract between owner and engineer should be the result of negotiation and discussion between both parties, resulting in a document that both fully understand and endorse.
Compensation for Services
Charges for engineering services are usually computed using one of five methods:
- Salary cost (direct labor) times multiplier (fringe benefits, overhead plus profit) plus direct non-salary expense (subconsultants, travel, etc.)
- Per diem or hourly rates
- Cost plus fixed fee
- Lump sum
- Method related to construction cost (frequently a percentage of construction)
The method or combination of methods used depends upon the nature, scope, duration, complexity, and quality of services required by the owner. Each of the methods is described in the "Standard Form of Agreement Between Owner and Engineer for Professional Services" published by the Engineers Joint Contract Documents Committee. This document can be purchased from the American Council of Engineering Companies (ACEC).