Securing A Claim For Bonus In Arbitration: A Contractor's Guide

The Clause for Early Completion Bonus ('Bonus') is provided in works contracts with the intention to reduce the time taken for completion that would normally be required. This is done by incentivising the contractor with a right to claim a certain percentage of the contract price as a bonus in case the actual completion date precedes the scheduled completion date. The contract may provide for such Bonus on early completion of a milestone, substantial work, or the complete project itself before the scheduled completion date.

The advantage of inserting such a provision in a contract is that, it acts as a tool to motivate efficient construction by encouraging the contractor to accelerate the work and complete the same before schedule. The contractor may do so either by means of efficient planning, strategic sub-contracting, working overtime or deploying extra labour/machinery/resources etc. Bonus clause is also inserted, keeping in mind the disruption and