What makes a delay compensable rather than just excusable?

Who caused it. An excusable delay only has to be outside the contractor's control to earn a time extension. For it to also be compensable, the cause generally has to be the owner or someone the owner is responsible for: late owner-furnished equipment, defective or late design, differing site conditions, or an owner-directed change without an agreed time impact. A neutral event that is nobody's fault, like a hurricane or an unusually severe winter, is excusable but non-compensable, because the owner did not cause it either. The money follows responsibility, not merely the fact that the contractor was blameless.

What costs can a contractor recover on a compensable delay?

The actual added cost of being on site longer, proven with records. The core is extended general conditions: the superintendent, site trailer, temporary utilities, and other time-related overhead that keeps running for the extra days. Add idle or underused equipment during the delay, labor and material escalation on work pushed into a more expensive period, and, where allowed, unabsorbed home-office overhead calculated by a method such as the Eichleay formula. Each category has to be tied to the specific delay period and supported by cost records, not estimated after the fact, which is why a compensable claim is really a documentation exercise.

What happens when owner and contractor delays overlap?

That is concurrent delay, and it usually cancels the money. When owner-caused and contractor-caused delays hit critical-path work in the same window, the prevailing US approach is that neither side recovers: the contractor typically still earns a time extension but not compensation, and the owner cannot assess liquidated damages for that period. Some frameworks, such as the UK Society of Construction Law protocol, apportion responsibility more finely. The outcome turns almost entirely on contemporaneous evidence of what was actually driving the completion date day by day, which is why the dated record matters so much.

Construction Glossary · Change Management

Compensable vsNon-Compensable

Two delays can both be excusable and land completely differently on the ledger. One earns time. The other earns time and a check.

Definition

Compensable delay is an excusable, owner-caused delay for which the contractor is entitled to both a time extension and recovery of the added cost. Non-compensable delay is an excusable delay from a neutral event, such as force majeure or unusual weather, for which the contractor receives a time extension but no money. Both are excusable; only one comes with a check.

Same slip, two different ledgers

Both delays below are excusable, so both earn a time extension. Only the owner-caused one carries money with it.

Non-compensable (unusual weather)

20-day slip

+20 days

time extension only — no cost recovery

Compensable (late owner-furnished equipment)

20-day slip

+20 days

+ cost recovery

time and money

What a compensable claim actually recovers

Compensation is the proven added cost of being on site longer, tied to the delay window — not a round number chosen after the fact.

Extended general conditions

Superintendent, trailer, temporary utilities — the time-related overhead that keeps running

Idle / underused equipment

Machines held on site through the delay window

Escalation

Higher labor and material prices on work pushed into a later period

Unabsorbed home-office overhead

Where allowed, via a method such as the Eichleay formula

What decides it: who caused the delay
Delay cause	Who bears it	Compensable?
Late owner-furnished equipment	Owner	Yes — time and money
Defective or late design	Owner	Yes — time and money
Differing site condition	Owner (allocated risk)	Yes — time and money
Unusually severe weather	Neither party	No — time only
Force majeure	Neither party	No — time only
Contractor under-manning	Contractor	Neither — and LDs may apply

The weather-and-force-majeure case is covered in force majeure, and the owner's side of the ledger in liquidated damages.

How POD builds the cost record

POD's commercial intelligence captures the delay event, its cause, and the contemporaneous evidence a compensable claim rests on, then lines it up against the change-order pipeline it may convert into. The daily reports, the dated schedule context, and the cost records that prove extended general conditions and idle equipment all live in one place rather than scattered across inboxes. POD does not adjudicate whether a delay is compensable; it keeps the record that argues it, so the claim is documented as the job runs, not reconstructed under deadline.

Delay analysis methodologies guide

Frequently asked questions

The money follows responsibility

A blameless delay still may not be paid. Compensation needs an owner-caused event and the cost records to prove it.

Excusable Delay Back to the Glossary