The New Zealand Construction Contracts Amendment Act 2015 - For Better or Worse?

Adjudication has been statutorily introduced as an alternative dispute resolution method in 14 jurisdictions including New Zealand. Whilst adjudication under the New Zealand Construction Contracts Act 2002 has been hailed a success, further refinements were proposed in the Construction Contracts Amendment Bill first published in 2013. As part of the legislative process, 48 submissions were made to the Commerce Committee. There was general support for most of the amendments, but some parties expressed concerns on some of the changes. A documentary analysis of the Amendment Bills and submissions to the Commerce Committee was made to critically evaluate the changes proposed and establish if they were improvements. The findings show the major changes proposed include (i) removing most of the distinctions between the treatment of residential and commercial contracts under the Act, (ii) extending the scope of the Act to apply to contracts for certain professional services, (iii) removing the distinction between enforcement of payment determinations and of those relating to rights and obligations, and (iv) making the enforcement process more efficient. The findings also show that during a period of over two years from when the Bill was first introduced in January 2013, one other significant improvement for retentions to be held in trust was made. A few proposals to further refine the Bill such as the suggestion to mandate retentions to be kepts in a separate trust account were however not accepted. The Construction Contract Amendment Bill (Bill 97-3) was uninanimously passed during the third and final reading in Parliament on 20 October 2015 with most of the amendments coming into force on 1 December 2015, those incorporating professional services on 1 September 2016, and the retention provisions on 31 March 2017. Royal assent was given on 11 October 2015 leading to the enactment of the Construction Contracts Amendment Act 2015

Displacement of Older Workers: Re-employment, Hastened Retirement, Disability, or Other Destinations?

The central objective of this study is to investigate the income sources and patterns of prime-age and older workers who suffer a layoff from steady employment. We focus on a set of cohorts who are deemed to have a high degree of attachment to the labour force preceding the event of an involuntary separation. Using a unique data base that merges administrative data marking the job separation, we track all of their sources of income over an interval that spans four years prior to the separation to five years after the separation. Our empirical analysis includes an investigation of the frequency that a laid-off individual will receive income ex post from a given source, a typology analysis of the various configurations of income received, and an econometric analysis of the incidence of certain post-layoff income configurations. We find that in any given year, approximately 2 % of our sample of workers with stable employment histories experience a ‘visible’ layoff. During the first three post-layoff years, 77 % of the group of laid-off workers (aged 45-64 years old) have non-trivial labour market earnings, and 56-65 % of them depend on the labour market for their primary source of income. This group of workers does experience substantial income losses. During the post-layoff period, approximately 14-19 % of them file a subsequent claim for EI benefits, but few of them depend on the EI regime as the primary source of their income. Very few of these individuals draw on other types of social insurance benefits, such as CPP disability, social assistance, and workers’ compensation. The most common destination state for prime-age and older workers who have not yet reached retirement age are early retirement and continued labour market activity, albeit at much lower earnings. It is rare for them to draw on social insurance benefits, and we find little evidence that disability benefits and workers compensation are functioning as disguised unemployment benefits.Post-layoff transitions, incidence of program usage, retirement behaviour, disability benefits, re-employment transitions

Contract delay: what is it and how are we performing?

AbstractThis paper examines the management of contract delays in the construction industry as currently practised, and suggests some best practice alternative methods.Research results about the level of contractor’s time management skills were analysed to determine the related impact on their ability to manage contract delays. A comparison was made between three conditions of contracts used in New Zealand to determine how delay management should be managed with a discussion about how the different contract conditions distribute risk among the parties. Recommendations were made to improve contract conditions, up-skill industry practitioners and ensure student graduates have adequate delay management skills

A contractual framework for two-stage early-contractor involvement (2S-ECI) in New Zealand commercial construction projects : a thesis submitted in fulfilment of the requirements for the degree of Doctor of Philosophy (PhD) in Construction at Massey University, School of Built Environment, Massey University, Albany, Auckland, New Zealand

Two-stage early contractor involvement (2S-ECI) is a two-stage procurement process for firstly employing a contractor during the design stage, and then entering into a contract for construction. 2S-ECI contractual practices remain generally unknown in New Zealand despite the well-documented advantages of involving contractors in the design-stage planning. Clients, with the help of their consultants or lawyers, must draft their own, often bespoke contract to engage the contractor’s services during the design stage because there are no standard forms of pre-construction services agreements (PCSAs) in New Zealand for employing contractors during the design stage. Some of these contracts, especially if done without professional advice, are drafted inadequately. This study attempts to remove these ambiguities and explore the effect 2S-ECI has on contractual risks; the optimal contractual ingredients to consider at the pre-construction stage such as timing, obligations and liabilities; the effect of 2S-ECI on market pricing; and the overall benefits, challenges, and opportunities to improve the effective use and uptake of 2S-ECI in New Zealand. A mixed-method research approach was adopted which comprised case law analysis, contract document analysis, and comparing these legal doctrines against industry perceptions which was obtained through conducting interviews and surveys. Three bespoke contract agreements used on 2S-ECI in New Zealand commercial construction projects were compared with two standard form PCSAs published in the UK. Perceptions of 2S-ECI use in New Zealand were explored through interviews of 21 senior construction practitioners. Interview findings were validated through surveying the interview sample. A contractual framework was developed to provide a clearer contractual process, identify contract ingredients for the pre-construction stage and establishing the effect of early involvement on the contractor’s obligations during the construction stage. The framework helps clients and project managers to develop procurement strategies using 2S-ECI, including as a starting point, the type of project suited to 2S-ECI. It also helps decision makers like architects, engineers, and quantity surveyors, to make more informed decisions on who should pay for instructed drawing details that come after entering into a construction contract such as the New Zealand Standard NZS3910:2013 Conditions of Contract for Building and Civil Engineering Construction. The framework considers; (i) when to treat claims for drawing details as variations; (ii) the legal implications of a contractor’s involvement in design development; and (iii) the legal implications on construction managers if there are claims from direct trade contractors against the client under a construction management procurement. Findings from the survey analysis shows the majority of interviewees see value in early collaboration between designers and contractors, but qualify this in that the actual value depends on the extent of the contractor’s contribution and that the tangible benefits are difficult to measure. Many felt that contractors had a moral duty to reduce their claims for design development during the construction. However, none was aware of the effect of early involvement on the contractor’s contractual obligations during the construction stage. 2S-ECI may have the potential to reduce the cyclical boom bust nature of construction pricing and provide a more equitable risk distribution between the contracting parties. 2S-ECI is best suited for projects involving work to existing building operations where the cost of disruption outweighs any premium incurred with the contractor’s early involvement in logistical planning; where the selection of preferred contractors through open-book negotiation is desirable; where securing resources in heated markets is otherwise difficult through competitive tender; and where designers want the contractor’s input for more complex design solutions. Challenges to the effective use and uptake of 2S-ECI in New Zealand were identified as part of the survey. The challenges include lack of clear 2S-ECI definition, unclear expectations and difficulty measuring the benefits, incomplete design documentation, and amendments made to standard contract terms transferring greater risks to contractors – without fully considering which party may be best able to manage the risk. The bespoke pre-construction contract documentation used often lacked scope of obligations and liabilities. Opportunities for improving the use and uptake of 2S-ECI in New Zealand include educating industry about 2S-ECI, developing a standard form of pre-construction services agreement (PCSA) for New Zealand, contractors developing specialist expertise in design coordination, buildability analysis and value management, and agreeing fixed-price construction contracts based on fully complete quality drawings. These findings also contribute to developing procurement policies that support transparency and appropriate risk equity and transfer toward the party who is best able to manage the risk within the New Zealand construction industry. A pre-construction services agreement (PCSA) was drafted with ingredients based on the findings (appendix 4). The framework also includes a flowchart that guides claims entitlement and a table comparing head or main contractor and consultant construction manager obligations was developed. This provide a practical guide for contract administrators and includes a summary of interpretation of terms to inform contract drafters that can help reducing ambiguity for all construction contracts. This has the potential to help avoid unwarranted disputes. It was also recommended that skills in construction law and buildability analysis within the construction industry be enhanced and for tertiary education institutions to play a greater role. These include skills in buildability-related claims-entitlement, the effect of early contractor involvement, the application of design buildability analysis, and design coordination and management within a building information model (BIM) system environment

Long-Run Inequality and Annual Instability of Men's and Women's Earnings in Canada

earnings inequality, earnings instability, long-run inequality

The Impact of Macroeconomic Conditions on the Instability and Long-Run Inequality of Workers’ Earnings in Canada

This paper examines the variability of workers’ earnings in Canada over the period 1982‑1997. Using a large panel of tax file data, we decompose total variation in earnings across workers and time into a long-run inequality component between workers and an average earnings instability component over time for workers. We find an increase in earnings variability between 1982‑89 and 1990‑97 that is largely confined to men and largely driven by widening long-run earnings inequality. Second, the pattern of unemployment rate and GDP growth rate effects on these variance components is not consistent with conventional explanations and is suggestive of an alternative paradigm of how economic growth over this period widens long-run earnings inequality. Third, when unemployment rate and GDP growth rate effects are considered jointly, macroeconomic improvement is found to reduce the overall variability of earnings as the reduction in earnings instability outweighs the widening of long-run earnings inequality.Le marché du travail canadien, au cours des décennies 1980 et 1990, a connu de nombreux changements eu égard à la structure commerciale, à la technologie de production, aux aménagements atypiques du travail, aux fluctuations démographiques, à la vulnérabilité des travailleurs, pour ne nommer que ceux-là. Cet essai analyse le caractère variable de la rémunération des travailleurs canadiens au cours de la période 1982 et 1997 et l’ampleur de ces variations en termes d’indicateurs macroéconomiques, du taux de chômage et du taux de croissance du PIB au cours de cette période. Nous reprenons les explications habituelles des changements cycliques au plan de l’inégalité de la rémunération avec l’éclairage de ces changements caractérisés au sein du marché du travail canadien.Notre essai fait appel à un large éventail de données de l’impôt sur le revenu provenant de la banque de Données administratives longitudinales (DAL) de Statistique Canada au cours de la période 1982–1997 et utilise une méthodologie de ventilation d’écarts de la variation totale des gains entre les travailleurs au cours de la période pour en dégager une composante permanente et de longue période entre les travailleurs et une composante transitoire ou d’instabilité des gains dans le temps chez les travailleurs. Ces trois mesures de variabilité sont toutes converties en une fonction des indicateurs macroéconomiques identifiés plus haut par une régression multivariée. Jusqu’ici, dans les écrits sur le sujet, les modèles de variance dans les configurations de gains faisaient appel aux techniques structurelles de séries temporelles. Ces dernières exigent une période de temps d’une longueur homogène au plan des gains. Par conséquent, ces études ont ciblé seulement les travailleurs masculins dans la force de l’âge entretenant un lien étroit avec le marché du travail. Cet essai s’en tient à une approche plus descriptive de l’ordre de séries a-temporelles dont font état Gottschalk et Moffitt (1994). Ceci permet de présenter une analyse empirique pour les femmes aussi bien que pour les hommes et pour un échantillon plus large de travailleurs.Des prélèvements larges et étroits de données pour les hommes et les femmes séparément sont regroupés à l’intérieur de deux sous-périodes (1982–1989 et 1990–1997), en quatre groupes d’âge et pour six régions géographiques, ce qui donne 48 sous-échantillons. Dans chacun des cas ainsi constitué, on a calculé et analysé la variance totale des gains annuels des travailleurs et de leurs deux composantes (instabilité et inégalité des gains de longue période). Ces trois mesures de la variance sont retenues à titre de variables dépendantes dans les équations de régression, qui incluent des contrôles pour le glissement dans le temps entre les décennies et pour les différences d’âge et de région. Les différences dans le temps et par région permettent l’identification d’un taux de chômage distinct et l’évaluation des effets du taux de croissance du produit intérieur brut. Les résultats clés sont présentés dans les tableaux 4 à 6 et le tableau-résumé 2 du texte principal.Plusieurs conclusions se dégagent de l’étude. Premièrement, une simple constatation aussi bien qu’une analyse de régression indiquent un accroissement de la variabilité de l’ensemble des gains des travailleurs au passage d’une période à une autre, surtout chez les hommes. On a déjà fait de telles observations dans des études antérieures tant au Canada qu’aux États-Unis. Cependant, la majeure partie de l’accroissement dans la variabilité des gains, en particulier chez les hommes, pouvait être attribuée à l’ampleur croissante de l’inégalité des gains en longue période. Chez l’échantillon plus vaste des hommes sur le marché du travail, les augmentations de la variabilité des gains de longue période représentaient entre 59 et 134 pourcent de la variabilité la plus élevée des gains, alors que, dans l’échantillon des hommes occupant des emplois permanents, elles rendaient compte de presque toutes les augmentations. L’instabilité des gains accrue jouait effectivement un rôle secondaire dans l’ensemble de l’augmentation des gains des hommes. Par contre, chez les femmes, le changement était à peine perceptible ou encore, dans le cas d’un même groupe d’âge, il contribuait à réduire l’ensemble de la variabilité des gains. En bout de ligne, le décalage des variances de gains entre les femmes et les hommes s’est remarquablement estompé.Deuxièmement, tant les taux de chômage que les taux de croissance du produit intérieur brut exercent un impact statistiquement significatif sur la variabilité totale des gains et ses composantes. Là encore, le taux de chômage crée des effets plus prononcés quand on le considère en termes d’élasticité. Le profil de l’impact du taux de chômage et de celui de l’accroissement du PIB sur l’instabilité des gains corroborent les arguments conventionnels du jeu du marché du travail cyclique à l’effet que le chômage et l’instabilité des gains croissent au cours des récessions ou les périodes de croissance lente et entrent de nouveau dans un déclin au moment des détentes subséquentes associées à des marchés du travail plus serrés. Cependant, l’effet anticipé du taux croissance sur l’inégalité de gains en longue période ne cadre aucunement avec les raisonnements habituels. Il est plutôt compatible avec le paradigme alternatif qui veut que la croissance économique récente soit associée aux efforts de restructuration économique et de réaménagement des lieux de travail. Ces efforts se veulent une réponse aux changements dans la production des biens et aux changements technologiques liés à l’économie du savoir, au moment où ces mêmes changements contribuent à intensifier l’inégalité des gains sur le marché du travail. L’effet positif du taux de croissance apparaît plus prononcé chez les travailleurs dans des emplois permanents et moins chez ceux qui occupent une position marginale sur le marché du travail. Ceci nous amène à croire que la présente révision fédérale des normes du travail et de l’emploi du Code canadien du travail, pilotée par Harry Arthurs, devrait se pencher plus particulièrement sur les effets de la restructuration et des aménagements des lieux de travail sur les travailleurs, ceux qui occupent des emplois permanents et dont la situation crée un élargissement constant de l’inégalité au sein de la force de travail.Este documento examina la variabilidad de los ingresos de trabajadores en Canadá durante el periodo 1982-1997. Utilizando una amplia lista de ficheros de datos fiscales, descomponemos la variación total en los ingresos, entre trabajadores y a través del tiempo, en un componente de desigualdad de largo plazo entre trabajadores y un componente de inestabilidad del ingreso promedio de los trabajadores a lo largo del periodo. Encontramos un incremento en la variabilidad de los ingresos entre los periodos 1982-89 y 1990-97, esencialemente restringido a los hombres y principalmente ocasionado por la ampliación de la desigualdad de largo plazo en los ingresos. Segundo, la tendencia de la tasa de desempleo y los efectos de la creciente tasa de GDP sobre esos componentes de variación no son consistentes con las explicaciones convencionales y sugieren un paradigma alternativo para explicar cómo el crecimiento económico en ese periodo amplía la desigualdad de largo tiempo en los ingresos. Tercero, cuando la tasa de desempleo y los efectos de la creciente tasa de GDP son considerados conjuntamente, la mejora macroeconomica se revela como un reductor de la variabilidad general de los ingresos mientras que la reducción de la inestabilidad de los ingresos pesa más que la ampliación de la desigualdad de largo plazo en los ingresos

Backtracking: Improved methods for identifying the source of a deliberate release of Bacillus anthracis from the temporal and spatial distribution of cases

Reverse epidemiology is a mathematical modelling tool used to ascertain information about the source of a pathogen, given the spatial and temporal distribution of cases, hospitalisations and deaths. In the context of a deliberately released pathogen, such as Bacillus anthracis (the disease-causing organism of anthrax), this can allow responders to quickly identify the location and timing of the release, as well as other factors such as the strength of the release, and the realized wind speed and direction at release. These estimates can then be used to parameterise a predictive mechanistic model, allowing for estimation of the potential scale of the release, and to optimise the distribution of prophylaxis. In this paper we present two novel approaches to reverse epidemiology, and demonstrate their utility in responding to a simulated deliberate release of B. anthracis in ten locations in the UK and compare these to the standard grid-search approach. The two methods - a modified MCMC and a Recurrent Convolutional Neural Network - are able to identify the source location and timing of the release with significantly better accuracy compared to the grid-search approach. Further, the neural network method is able to do inference on new data significantly quicker than either the grid-search or novel MCMC methods, allowing for rapid deployment in time-sensitive outbreaks