NEC3 vs NEC4: The Main Differences

The main differences in NEC3 vs NEC4 are new names, moved clauses, tighter timing on early warnings, treated acceptance of programmes, simpler cost rules and a new final assessment. The approach is unchanged, so a good NEC3 team will adapt quickly, but habits and templates built on NEC3 can go wrong without anyone noticing.

This table compares the ECC: NEC3 April 2013 against NEC4 June 2017 with its later amendments. Your contract may have Z clauses, so check it. For the overview, see the NEC4 contracts guide.

Side by side: what changes in practice

Topic	NEC3 ECC	NEC4 ECC	What it means for you
Trust and co-operation	Part of 10.1	Separate clause, 10.2	Following the contract and co-operating are both clearly required
Names	Employer, Works Information, Risk Register	Client, Scope, Early Warning Register	Update every template
Early warning timing	No fixed times	First register 1 week and first meeting 2 weeks after the starting date; revised register within 1 week of each meeting	Diarise from day one
Contractor's saving proposals	No clause	Clause 16	A formal route, with a set reply
Programme with no reply	A late reply is a compensation event only	Treated as accepted after a notification and a further week (31.3)	Project Managers need to reply or risk accepting a poor programme
Acceleration	The Project Manager can instruct a quotation	Discussed first; both have to be willing before a quotation is instructed (36.1)	A discussion comes first
Quality	No quality management clause	Clause 40: a system, a policy statement and a plan	A new submission for acceptance
Applications for payment	Project Manager considers any application	Contractor applies before each assessment date (50.2); without one, it gets the lesser of the assessment and the previous amount due (50.4)	A missed application can leave you without a payment
Fee	Direct and subcontracted percentages	One fee percentage	Tender differently
Finalising Defined Cost	No process	50.9, Options C to E	Audit items can be closed during the job
Final account	No procedure	Final assessment, clause 53	A clear end, and a time limit to challenge it
Compensation events	19 core events	21: adds (20) quotation for a proposed instruction not accepted and (21) events added in the Contract Data	Check for bespoke events
Assessment	A date divides work done from work not yet done (63.1), with no label	The same idea, now called the "dividing date" (63.1)	A clearer name for the line between actual and forecast
Proposed instructions	61.2 and 62.3	Clause 65	The Project Manager states when it may be given
Liabilities	Employer's risks; everything else with the Contractor	Client's liabilities (80.1) and listed Contractor's liabilities (81.1)	Read the new lists
Termination at will	The Employer may terminate for any reason	Only if Option X11 is chosen	A new tender decision
Disputes	Straight to the Adjudicator	Senior Representatives first or by agreement, and Option W3	Name your representatives
Communications system	Not addressed	Where the Scope names one, it decides when a communication takes effect (13.2)	Agree how you will communicate

The clause-by-clause number moves are in the guide's renumbering table.

The three changes people underestimate

Treated acceptance of a programme

Under NEC3, a Project Manager who sat on a programme faced a compensation event for the late reply, but the programme itself was not accepted. Under NEC4, silence can make a programme the Accepted Programme, including any optimistic logic in it. Since delay is measured against the Accepted Programme, that matters to the Client. Programme deemed acceptance covers the steps.

Applications for payment

Many NEC3 teams treated applications as optional because the Project Manager assessed the amount due anyway. An NEC4 Contractor with no application gets no increase in what is due, because it receives the lesser of the two figures. For a fictional example: the amount due last month was £400,000, and the Project Manager assesses £460,000 this month. With no application, the amount due stays at £400,000, and the £60,000 moves to the next assessment at the earliest. Payment applications goes further.

Final assessment and its time limit

Clause 53 sets a final assessment, which then becomes conclusive unless someone refers a dispute in time. Teams that park a disagreement "for the final account" could lose the chance to raise it. See final assessment of the amount due.

What did not change

• The 8 weeks for a Contractor to notify a compensation event (61.3).
• The 3 weeks to quote and 2 weeks to reply (62.3).
• Treated acceptance of notifications and quotations after a further 2 weeks (61.4, 62.6, 64.4).
• Main Options A to F.
• Option Y(UK)2's pay less notice at Y2.3, with suspension moving to Y2.5.

Common mistakes when switching

• Citing NEC3 numbers in NEC4 letters. "Early warning under clause 16" is a Contractor's proposal in NEC4.
• Reusing old Z clauses unchecked. A Z clause that was written around NEC3 numbers may now refer to the wrong clause or duplicate something the contract now does.
• Pricing two fee percentages. The NEC4 Contract Data asks for one.
• Assuming the subcontract matches. The ECS uses the same numbers but different periods, and some of its rules differ too.

If you are planning a move, moving from NEC3 to NEC4 has the practical list. To see the changes through the words, read NEC4 terminology changes.

Related guides

• NEC4 Contracts: A Complete Guide
• Early Warnings: What Changed in NEC4
• Programme Changes in NEC4
• Cost and Fee Changes in NEC4
• What Is NEC4?
• The NEC4 Suite of Contracts

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.