The NEC4 Framework Contract (FC) sets out how a Client appoints one or more suppliers over a set term and orders work, services or goods from them as needed. It doesn't itself contain the delivery terms: each call-off is placed under another NEC4 contract.
Under NEC4, work orders are generally based on the ECC or ECSC, and time charge orders usually sit under the PSSC. So the FC is always used alongside at least one of the other NEC contract types.
Who the contract is between
The FC is a contract between two parties: the Client and a Supplier. If you want a panel of five suppliers, you have five separate framework contracts on the same terms, not one contract with six signatories. This is different from the multi-party Alliance Contract.
How a call-off works
NEC's guidance on the framework process, written for NEC3 and consistent with the way the NEC4 form is described, gives this general sequence. The names in your copy may differ a little.
- Set up the framework. Tender and sign the FC, with the framework information, a selection procedure and quotation information prepared in advance.
- Identify a package. The Client defines a discrete piece of work.
- Select the supplier. Where more than one supplier could do it, a selection procedure specific to the framework decides who is invited to quote. This is written for your framework, not supplied by NEC.
- Issue the information. The Client completes its part of the Contract Data for that package, including its Scope.
- Receive a quotation. The Supplier builds it from the tendered quotation information, such as rates and fee percentages.
- Decide. The Client accepts it, asks for a revision, or decides not to issue the package. It can't impose its own assessment.
- Place the order. On acceptance, the package becomes a standalone contract under the chosen NEC form.
Two kinds of order
| Order type | Usually based on | Used for |
|---|---|---|
| Work order | ECC or ECSC | Physical work |
| Time charge order | PSSC | Consultancy, such as work that helps define a later package |
Under NEC3, a time charge order was described as a consultancy under the PSC's time-based Option E. NEC4 points to the PSSC, so check any older template you are reusing.
What sits in which contract
| Question | Answered in |
|---|---|
| How are suppliers selected for a package? | The framework |
| What rates are used to build a quotation? | The framework's quotation information |
| How long does the arrangement last? | The framework's term |
| When is this piece of work due? | The order's contract |
| Is this delay a compensation event? | The order's contract |
| How much is due this month? | The order's contract |
A dispute about a package usually belongs to that package's contract. Treat each order as a project in its own right, with its own Scope, programme and compensation event register.
What to settle when you set one up
- The selection procedure. Direct award, rotation or mini-competition? Public bodies also need to follow the procurement rules that apply to them, so take advice.
- Quotation information. This is what really fixes your prices. If it's thin, every call-off becomes a negotiation.
- Which contracts and Options apply. Set these out at the start, and standardise the data for each order. NEC itself recommends using consistent contract data to avoid arguments over which terms apply.
- Whether any work is promised. Be honest with bidders. Read the form and your documents, and don't imply a volume you can't support.
- Performance across orders. Each order's Options sit in its own contract, so think about how lessons and KPIs carry across packages.
A fictional example
A housing association sets up a framework with four suppliers for small repairs and refurbishment. Each supplier signs an FC with an agreed schedule of rates. For a roof replacement, the selection procedure invites two suppliers to quote. The first supplier quotes an illustrative £180,000 and the second £165,000. The Client accepts the second. An ECSC is put in place for that job. A later, larger block refurbishment goes through the same route but is placed as an ECC, because it needs a Project Manager and a formal programme. If you're not sure which form suits a package, use the guide on how to choose an NEC contract.
Related guides
- NEC Contract Types: Which Form Do You Need?
- NEC4 Dispute Resolution Service Contract (DRSC)
- ECC vs ECSC: Full or Short Contract?
- ECC vs TSC: Works or Term Service?
- NEC4 Alliance Contract (ALC)
- NEC4 Facilities Management Contract
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This guide is general information in our own words, not legal advice. Your contract and its Contract Data always govern. NEC, NEC3 and NEC4 are trade marks of Thomas Telford Ltd; Contract Status is not affiliated with or endorsed by NEC.