Does WFH during Covid-19 times by vendor impact the T&M contracts billing ?

NAJIB ANWER Sr Project Manager| Bank Albilad Riyadh, Saudi Arabia

Pls help me understand this as my vendor is charging me as normal (T&M) but the vendor resource are available only at offshore location and supporting via remote access.

All flight, train, travel, visa cost for wfh duration is saved by vendor.

Help me understand this.

Posted: Jan 10, 2021 8:11 AM

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Kiron Bondale Retired | Mentor| Retired Welland, Ontario, Canada

Najib -

If it is a T&M contract and so long as the vendor is only charging you for time they spend working then remote or in person work shouldn't matter. If the hours reported don't align with the work completed, you can certainly make a claim.

Kiron

Posted: Jan 10, 2021 9:39 AM

Bill Dow PMO Director| University of WA Renton, Wa, United States

Agree, it is a T&M contract, the you pay for the time they are working. Did you have any of that remote contract language in the contract? Do the hours they support, cover your business needs? This COVID has definitely put some wrinkles in the mix for sure, but contracts are contracts and should be tight in the execution.

Posted: Jan 10, 2021 4:58 PM

Emily Luijbregts Project Manager| Siemens PLM Software Breda, Netherlands

Hi Nijab,
I agree with Kiron: Are they doing the work that is outlined in the contract? If they are and the quality is as dictated in the contract, then it doesnt matter where the work is done.

If the hours are incorrect or the quality is incorrect/poor then you need to discuss that with the vendor themselves.

Posted: Jan 11, 2021 8:29 AM

Keith Novak Tukwila, Wa, United States

The T&M contracts I've worked assume a fixed cost for hourly rate. It doesn't matter if the individuals are actually paid more or less than that. If the contractor is able to reduce their cost basis, they do not pass on the savings. Likewise, if they give their employees a raise to a higher wage, they don't pass on the cost increase either.

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1 reply by NAJIB ANWER

Jan 11, 2021 9:14 AM

NAJIB ANWER

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Thanks

Posted: Jan 11, 2021 8:32 AM

NAJIB ANWER Sr Project Manager| Bank Albilad Riyadh, Saudi Arabia

Jan 11, 2021 8:32 AM

Replying to Keith Novak

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Thanks

Posted: Jan 11, 2021 9:14 AM

Peter Rapin Subject Matter Expect; Project Delivery| Independent Consultant Ontario, Canada

Trying to understand the question. Are the costs for travel included in the hourly rates? Is the question related to the savings associated with travel not being passed on to you, the client?

Typically when travel costs are included in the rates then the contractor absorbs costs related to required travel. If travel is not necessary to perform the services contracted then the contractor is not obligated to travel and there is no obligation to share the savings with the client.

However if the contractor is not providing the services due to not being physically available then that is the issue - failure to perform rather than refusing to share savings.

Now, what about the hours spent traveling? Under the contract, who pays for those? If included in the hourly rates then the contractor saves again. However if those hours are typically included in the time charged to the client then the client saves.

My opinion - focus on the quality of service provided rather then the insignificant sharing of travel costs. Are you getting what you contracted for?

Posted: Jan 11, 2021 9:27 AM

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Does WFH during Covid-19 times by vendor impact the T&M contracts billing ?

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