Selection, Engagement and Remuneration of Consulting Engineers

Client / consulting engineer relationship

A Consulting Engineer provides a professional service. A Client, in selecting a Consulting Engineer, is selecting a professional adviser. The Consulting Engineer’s role is to put expert knowledge at the disposal of his Client. On engineering matters, he serves his Client’s interests as if they were his own. It is essential that he should have the necessary ability. It is equally important that the Client and Consulting Engineer should proceed on the basis of mutual trust and co-operation. In the professional relationship, the Consulting Engineer identifies with his Client’s aims.

Selection, engagement and remuneration process

In order to achieve the desired relationship, Clients are advised to follow six basic steps:

1. Draft outline terms of reference for the project.
2. Consider possible professional services, such as; investigations and reports; detailed design and preparation of contract documents: arrangements for a contract; services-during-construction: and acceptance of works, commissioning of systems, and solutions of final account, considering the importance of the various tasks, and the special skills, knowledge and competence required for them.
3. Identify possible Consulting Engineers from: previous experience, or advice from a National Association of Consulting Engineers or other source.
4. Select a Consulting Engineer, on the basis of his ability, considering technical competence, managerial ability, special expertise, previous experience, available resources, professional integrity, quality assurance systems, and independence from other interests.
5. Discuss with the selected Consulting Engineer important issues, such as; the project, its purpose, budget and time-schedule; the professional services required, and the ability of the Consulting Engineer to provide them; project Organisation and working relationships; any special political, social or environmental considerations; the availability of staff and facilities; and conditions of engagement and remuneration.
6. Conclude an Agreement appointing the Consulting Engineer.

Comprehensive agreement

The Agreement should confirm the scope of services and remuneration for them. The particulars should include the time-schedule for the services and interim payments. The general conditions should prescribe an equitable balance of rights and obligations between the Client and the Consulting Engineer, based on the responsibilities they respectively undertake. The responsibilities ascribed to the Consulting Engineer should be confined to responsibilities for the services entrusted to him.

Change in Work scope

The Agreement should allow for the possibility that additional or amended services may become desirable or necessary as the project proceeds. When the scale or duration of the services is uncertain, the conditions and terms of remuneration should be sufficiently flexible to accommodate changes. The underlying principle is that the Consulting Engineer should do what is necessary in consultation with his Client, and subject to his Client’s instructions, to secure the Client’s best interests for the project.

Equity of remuneration

Payments made by a Client to his Consulting Engineer are subject to the fixed principle that they comprise his sole remuneration for the services. In equity, therefore, they must be commensurate with:

- the scale and duration of the services
- the levels of experience and expertise involved
- the responsibilities being undertaken.

Payments should not be affected by risks over which the Consulting Engineer has no control, such as procedural delays or the performance of a Contractor.

The remuneration basis can be expressed in different ways, for example:

 - payment on a time basis
 - payment of a lump sum, based on either:
       a. the Consulting Engineer’s estimation of the work involved and after subsequent discussion with the Client
       b. generally accepted fee scale, if any
 - payment as a percentage of the cost of the Works.

Direct expenses are normally reimbursed separately, or can be included partly or wholly in other payments, depending on the circumstances. Payments on a time basis are normally invoiced monthly or at other agreed intervals. Also lump sum payments are normally divided into instalments.

The costs of the services depend on their type and extent, which should be determined in consultation between the Client and his Consulting Engineer. The costs are likely to be small compared to the projects resulting from the services. The first consideration should be the suitability of the services to their intended purpose.

Therefore, FIDIC recommends as follows:

1. Selection of a Consulting Engineer should be based on his ability to perform the required services.
2. Engagement and subsequent employment of a Consulting Engineer should be based on mutual trust and co-operation.
3. The Agreement confirming the engagement of a Consulting Engineer by a Client should reflect the professional relationship between them (possibly using the FIDIC Client/Consultant Model Services Agreement).
4. Payment should be sufficient for the proper performance of the services by Consulting Engineer under the conditions that apply, and should be agreed between the Client and the Consulting Engineer with respect to: the scale and duration of the services, the levels of experience and expertise involved and the respective responsibilities being undertaken by the Client and the Consulting Engineer.