This guide explains what early warnings are, who must give them, how the early warning register works, and the commercial consequences of getting the process wrong.
What is an NEC4 early warning
An early warning (sometimes called an early warning notice, or EWN) is a formal notification under clause 15.1 that a risk exists which could affect cost, time, or performance. It is not a claim. It is not an instruction. It is a signal that something needs attention before it becomes a problem.
The purpose is collaborative risk management. NEC4 was designed on the principle that problems identified early can be solved jointly. Problems identified late become entrenched disputes. The early warning mechanism forces that early identification.
An early warning does not allocate liability. It does not admit fault. It places a matter on the record so both parties can act on it.
NEC4 early warning lifecycle: from awareness through notification, register, meeting, to risk mitigation
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Who must give early warnings
Both parties share the obligation equally. Under clause 15.1, the Project Manager and the Contractor must each give an early warning as soon as they become aware of any matter that could:
- Increase the total of the Prices
- Delay Completion
- Delay a Key Date
- Impair the performance of the works in use
All four triggers have been present since NEC3 (where early warnings sat under clause 16). Key Dates are frequently overlooked on projects where they have been included in the Contract Data, particularly on projects with phased handovers or interface milestones.
The obligation is not discretionary. "As soon as becomes aware" means at the point of awareness, not when convenient. Waiting until the next progress meeting or the next monthly report does not satisfy the requirement.
The four trigger categories
Every early warning must relate to at least one of the four categories in clause 15.1. If a matter does not fall within any of these categories, it is not an early warning matter under the contract.
| Category | Trigger | Typical Example |
|---|---|---|
| Increase total Prices | Any matter that could increase the contract sum | Unexpected ground conditions requiring additional piling |
| Delay Completion | Any matter that could push Completion beyond the Completion Date | Supplier insolvency affecting cladding delivery |
| Delay Key Date | Any matter that could delay a milestone in the Contract Data | Design information delayed for a phased handover zone |
| Impair performance in use | Any matter that could reduce the functionality of the completed works | Specification change to drainage that reduces flow capacity |
In practice, most early warnings relate to the first two categories. The Key Date trigger is frequently overlooked on projects where Key Dates have been included in the Contract Data.
The early warning register
The Project Manager maintains the early warning register. NEC4 renamed this from the "Risk Register" used in NEC3, to distinguish it from the broader project risk register that many organisations maintain separately. Under clause 15.2, the register records two things for each entry: the description of the risk, and the actions to be taken to avoid or reduce it.
The register is a living document. It is updated at early warning meetings and whenever new early warnings are given. The Project Manager adds to it when either party gives an early warning or when an early warning meeting identifies new actions.
There is no prescribed format. Some projects use spreadsheets. Others use dedicated contract management software. The contract only requires that it exists, that it is maintained by the Project Manager, and that it records those two items for each early warning. In practice, most registers also include an EWN reference number, date notified, and status, but these are practical additions rather than contractual requirements.
Early warning meetings
NEC4 renamed the NEC3 "risk reduction meeting" to the "early warning meeting." Either the Project Manager or the Contractor can instruct the other to attend an early warning meeting at any time under clause 15.3. The purpose is to review the early warning register and agree actions to reduce or avoid the identified risks.
The meeting must consider three things: proposals for how the risk can be avoided or reduced, proposals for how the effects can be managed if the risk occurs, and whether any risk should be removed from the register.
Early warning meetings are collaborative, not adversarial. They operate under the clause 10.2 spirit of mutual trust and co-operation. A party that attends an early warning meeting and obstructs constructive discussion undermines both the contractual process and their own credibility in any future dispute.
Early warnings and compensation events
An early warning is not a compensation event notification. They serve different purposes and operate under different clauses. Confusing the two is one of the most common errors on NEC4 projects.
| Feature | Early Warning (Clause 15) | CE Notification (Clause 61) |
|---|---|---|
| Purpose | Flag a risk for collaborative management | Notify an event that has occurred and claim entitlement |
| Timing | As soon as aware of the risk | Within eight weeks of becoming aware the event occurred |
| Who gives it | Both PM and Contractor | Usually the Contractor (for Contractor-notified events) |
| Consequence of not giving | PM can invoke clause 63.7: CE assessed as if early warning had been given | Entitlement lost (time barred under clause 61.3) |
| Allocates liability | No | Yes (triggers quotation and assessment process) |
An early warning often precedes a compensation event. Unexpected ground conditions might first appear as an early warning when trial pits reveal anomalies. If those conditions later affect the Contractor's programme or costs, a formal CE notification under clause 61 is required separately.
Giving an early warning does not start the eight-week time bar. That clock starts only when the Contractor becomes aware the compensation event has occurred. But failing to give an early warning has its own consequences under clause 63.7.
The sanction: clause 63.7
Clause 63.7 is not automatic. It requires the Project Manager to state, in the instruction to submit quotations, that the Contractor did not give an early warning of the event which an experienced contractor could have given. If the PM does not include this statement in the instruction, the sanction does not apply. The assessment itself is based on the effect on Defined Cost from the dividing date, using the Accepted Programme current at that date.
When the PM does invoke clause 63.7, the compensation event is assessed as if the Contractor had given early warning at the point when an experienced contractor would have done so. The assessment then considers what mitigation measures could have been taken in the intervening period. If earlier identification would have allowed the project team to reduce the impact, the CE assessment is reduced by that amount.
This is a financial reduction, but it is not a time bar. The Contractor does not lose entitlement entirely. They lose the portion of entitlement that proper early warning management would have prevented. On a large compensation event, the difference between giving an early warning six weeks before the CE and not giving one at all can be the difference between full recovery and a significant reduction in assessed cost and time.
Clause 63.7 in practice: same event, same delay, £35,000 less because no early warning was given
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Worked example: early warning on a rail electrification project
Worked ExampleProject: £18 million rail electrification, overhead line equipment installation
A contractor is delivering overhead line equipment installation on a rail electrification project worth 18 million pounds. The Accepted Programme shows permanent way access in Zone C from 15 April.
Week 1 (10 March): The site team reports that the preceding civil engineering contractor in Zone C is behind programme. Their works will not complete until late April at the earliest. The site engineer records this in the site diary.
Week 1 (11 March): The commercial manager reads the diary entry and gives an early warning to the Project Manager. "Access to Zone C may not be available by 15 April as shown on the Accepted Programme. The preceding contractor is behind their programme."
Week 2 (18 March): The Project Manager adds the risk to the early warning register and calls an early warning meeting for 22 March.
Week 3 (22 March): At the early warning meeting, the parties agree three actions. First, the Contractor will re-sequence work to bring forward Zone D activities that do not depend on Zone C access. Second, the Project Manager will request an updated programme from the preceding contractor. Third, both parties will review the position again on 5 April.
Week 7 (20 April): Zone C access is confirmed as delayed to 28 April, thirteen days later than the Accepted Programme. The Contractor notifies a compensation event under clause 60.1(2) for failure to provide access by the date shown on the Accepted Programme.
The CE assessment included 92,000 pounds for programme impact: prelims, standing time on plant, and supervision costs for the thirteen-day delay. Because the Contractor gave early warning on 11 March, the full 92,000 pounds was assessed.
What happens without the early warning
Now consider what happens if the commercial manager had not given that early warning on 11 March. No early warning meeting takes place. No re-sequencing to Zone D. The same thirteen-day delay occurs, and the Contractor notifies the CE. The PM invokes clause 63.7 in the instruction to submit quotations, stating that the Contractor did not give an early warning which an experienced contractor could have given. The CE is now assessed as if the Contractor had given early warning at the appropriate time. The PM considers what mitigation an early warning meeting would have achieved: re-sequencing to Zone D could have recovered five days of the thirteen. The assessment is reduced by those five days of avoidable programme impact, roughly 35,000 pounds. The Contractor recovers 57,000 pounds instead of 92,000 pounds. Same event, same delay, 35,000 pounds less because the early warning was never given.
Common failures in practice
The early warning process fails for predictable reasons. Each failure has a specific commercial consequence.
Not notifying at all. The most common failure. Site teams record risks in diaries and progress meeting minutes but never issue a formal early warning. This happens because many teams assume a diary entry or a discussion at a progress meeting constitutes an early warning. It does not. Clause 13.1 requires a separate, formal communication. When the related CE is assessed, the PM can invoke clause 63.7 and reduce entitlement by whatever mitigation could have been achieved. A robust records and compliance framework helps ensure early warnings are raised as formal notifications rather than buried in meeting minutes.
Treating early warnings as CE notifications. A contractor issues an early warning believing it starts the compensation event process. It does not. The two serve different purposes under different clauses. The CE still requires a separate notification under clause 61, and the eight-week time bar runs independently. This confusion is especially common on teams new to NEC4, where the difference between flagging a risk and claiming entitlement is not always well understood.
Issuing early warnings too late. An early warning given the same week as the CE notification provides no opportunity for collaborative risk reduction. The purpose of the mechanism is to create time for joint problem solving. Late early warnings are technically compliant but practically useless. They happen when the early warning process is treated as a box-ticking exercise rather than a genuine risk management tool.
Ignoring the register. The Project Manager maintains the register but early warning meetings are never called, or are called but produce no actions. The register becomes a filing exercise rather than a management tool. This often reflects a wider cultural problem: the contract administration processes exist on paper but nobody treats them as working documents.
Only the Contractor notifies. The obligation is mutual. When the Project Manager identifies a risk to cost, time, or Key Dates, they must give an early warning too. On some projects, only the Contractor uses the mechanism, which undermines the collaborative intent. This imbalance usually arises because PMs perceive early warnings as a contractor tool for commercial claims rather than a shared risk management process. A regular contract health check will expose these patterns before the clause 63.7 consequences accumulate.
Gather flags early warning triggers automatically by analysing daily site diary entries against the Accepted Programme. When records indicate a risk to cost, time, or a Key Date, the commercial team receives an alert before the opportunity to notify is lost.
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