To choose among the NEC options, start with one question: how well is the work defined at tender? A settled Scope leans towards a priced contract (A or B), a partly settled one to a target (C or D), and an unsettled one to cost reimbursable (E). Everything else fine-tunes that answer.
With NEC options explained as a decision, it comes down to five questions. The usual approach is for the Client to make the choice before tender. Any recommendation here is a starting point, so take advice for your project. The main Options overview describes each Option in more depth.
Five questions in order
1. How complete is the Scope?
| State of the Scope at tender | Leans towards |
|---|---|
| Fully designed, or a clear performance requirement for the Contractor to design to | A or B |
| Outline design with known unknowns, enough to set a fair target | C or D |
| Unknown extent of work, or an urgent need to start | E |
| Packages to be designed and let progressively, with a manager | F |
2. Are quantities the main uncertainty?
If design is settled but the volumes could move (earthworks, for example), a measured contract avoids the risk premium in a lump sum. That means B, or D if you also want a target. If quantities are predictable, or the Contractor will design, then you can stay with A or C. Option A vs Option B looks at this in detail.
3. Who can best manage the risk that remains?
Pushing risk onto a Contractor who can't control it mainly makes the job more expensive or sets up a dispute. Pairing the Option with the Contract Data helps. For example, you might state the weather and physical condition data more carefully, rather than changing Options. Risk allocation by main Option sets out who carries what.
4. Can your team run the Option?
| Requirement | A | B | C | D | E | F |
|---|---|---|---|---|---|---|
| Check finished activities or measured work | Yes | Yes | Target only | Target only | No | No |
| Review Defined Cost each month | No | No | Yes | Yes | Yes | Yes |
| Review forecasts of total cost | No | No | Yes | Yes | Yes | Yes |
| Prepare or review a method of measurement | No | Yes | No | Yes | No | No |
If there's nobody to review Defined Cost, think hard before selecting C, D, E or F, because Disallowed Cost relies on someone actually looking.
5. What do you want from the relationship?
If you want the Contractor to bring in ideas and share savings, Options C and D give it a direct stake. Under A and B, the value engineering percentage offers some reward for accepted changes to the Scope the Client provided. Early involvement through Option X22 can be used only with C or E, which can tip the decision on larger schemes.
Quick examples
These are fictional projects to illustrate the reasoning, not rules.
| Project | Likely Option | Why |
|---|---|---|
| Small school extension, full design, tight budget | A | Well defined, Client wants certainty and has a small team |
| Highway resurfacing with measured quantities and settled design | B | Repetitive and measurable, with quantities that can change |
| Water treatment upgrade with live-plant interfaces | C | Enough definition for a target, with real uncertainty to share |
| Coastal scheme with uncertain rock quantities and a settled design | D | Both shared incentive and remeasurement make sense |
| Emergency flood repair | E | Work has to start before it can be defined |
| Large phased fit-out, trade packages let as design develops | F | Manager adds value and subcontract packages carry the work |
Traps to avoid
- Choosing by habit. Using the Option your organisation always uses, without asking how defined this job actually is.
- Choosing Option A to pass risk the Contractor can't price. You'll pay in the tender, in compensation events, or in a dispute.
- Choosing Option C with no capacity to check cost. Consider Option A, or plan for extra resource, such as an audit team.
- Ignoring what the secondary Options allow. X1 only works with A to D. X3 only with A and B. X16 can't be used with F. Look at choosing secondary Options at the same time.
- Forgetting subcontracts. The Engineering and Construction Subcontract offers A to E, but the subcontract doesn't have to use the same letter as the main contract. Think through what happens at the boundary: see back-to-back subcontracts.
A note on form and edition
This guide is about the ECC. If you're appointing a consultant, the PSC main Options offer a smaller set. For a long-term service with call-off work, see the TSC main Options. If you haven't yet settled on a contract form, read how to choose the right NEC contract first.
Related guides
- NEC Main Options: A to F Explained
- The Activity Schedule
- The Bill of Quantities Under NEC
- Target Cost and the Contractor's Share
- Option A vs Option B
- Option C vs Option E
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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.