GROUP III
CORPUZ
Charging of Civil Engineering Services
• Salary Cost * Multiplier +Direct Non-Salary Expense
• Hourly Billing Rate
• Salary Per Diem
• Cost Plus Fixed Fee
• Fixed Price
• Percentage of Construction Cost
*Schedule of Minimum Fees
Salary Cost * Multiplier +Direct Non-Salary Expense
Compensation on the basis of the salary cost times
an agreed multiplier is a frequently used method of
determining charges for engineering services and added by
the direct non-salary expense. With this method, charges for
engineering services are based mainly on direct salaries.
Factors:
1. Salary Cost
Defined as “direct salaries plus employee’s benefits”.
2. Multiplier
The size of the multiplier will vary with the type of
service, the nature and experience of the civil
engineering firm, and the geographic area in which its
office is located. The average multiplier should be
between 2.5-3 times the average salary cost.
Overhead
Comprises a major portion or the compensation
generated by the multiplier on salary cost.
3.Direct Non-Salary Expense
Usually incurred in engineering
engagements;Expenses in living, traveling,
communications, equipment services, drafting
supplies, reproduction works and unusual expenses.
Accounting Records
The Civil Engineer who performs services under a
salary cost times multiplier agreement or other cost-
based agreement must provide the accounting
necessary to segregate and record the appropriate
expenditure.
HIRAMIS
Cost Plus Fixed Fee Contract
A cost plus fixed fee contract is a specific
contract type that offers a set incentive for the contractor
upon the job completion.
When is a Cost Plus Fixed Fee Contract Used?
Cost plus fixed fee contracts can be used when
both the contractor and the owner agree that the
contractor is entitled to a fee in addition to the project
expenses.
Some advantages of a CPFF contract can include:
▫ The final cost may be lower than in a normal
contract, as the contractor usually will not “inflate”
prices to cover risks.
▫ The contractor also has less incentive to control
the project costs.
▫ They can often ensure higher-quality output than
normal contracts
Disadvantages of cost-plus fixed-fee contracts may
include:
▫ The final cost may not be very clear at the
beginning of negotiations.
▫ May require additional administration or oversight
of the project to ensure that the contractor is
factoring in the various cost factors.
▫ May be less incentive to complete the project in
an efficient manner.
Who Benefits from Cost Plus Fixed Fee Contracts?
Contracts of this nature are generally more
beneficial to the client than they are to the contractor.
LORENZO
FIXED PRICE
• Frequently used for investigations and studies
and for basic services on design type of projects where
the scope and complexity of the assignment are clear and
fully defined
PERCENTAGE OF CONSTRUCTTION COST
• Defined as the estimated total cost of
constructing the facility to be cover by the proposed
detailed design. This method is not common to use
because of the increasing complexity and large variation
in tasks for projects.
• The validity of the percentage of construction
cost method rest upon the assumption that detailed
design and construction supervision cost vary in
proportion to the cost of construction
The percentage fee shall not exceed :
a) Feasibility studies – 3%
b) Detailed Engineering Design – 6%
c) Detailed architectural & engineering design – 8%
d) Construction supervision – 10%
ALVAREZ Minimum Compensation for Civil Engineer’s for
Schedule of Minimum Basic Fees rendering the following Services
Minimum Compensation for Civil Engineers as Prime
Professional  Value Engineering 25% of Professional Fee of
savings
 When a Civil Engineer assumes overall coordination  Expert Witness P2000 / appearance
including architectural and other engineering services,  Academic Services
The Engineer is a Prime Professional. a) BS degree holder P75/hr-P150/hr
b) Master degree holder P150/hr-P250/hr
Group I -Simple Structures, one storey buildings, warehouses,
c) Doctorate degree holder P250/hr-P400/hr
market buildings and comparable projects.
d) Lecturer (PICE-CPD) P500/hr
Project Construction Cost Minimum Basic Fees e) Conducting Tutorial P500/hr
P10 Million and less 6% f) Resource Speaker P500/hr
Over P10 Million to P20M P600,000 plus 5.5% g) Writer/Author P3000/article
Over P20 Million to P30M P1,150,000 plus 4.5% of excess
of P20M
Over P30 Million P1, 600, 000 plus 3.5% of
excess of P30M

Group II - Buildings of 3 to 14 floors, towers, tanks, industrial

buildings, piers, and comparable projects

Project Construction Cost Minimum Basic Fees

P10 Million and less 7%
Over P10 Million to P20M P200,000 plus 6.5% of excess of
P10M
Over P20 Million to P30M P1,350,000 plus 5.5% of excess
of P20M
Over P30 Million P1, 900, 000 plus 4.5% of
excess of P30M

Group III - Buildings of 15 or more floors, long span and

complex bridges, high dams, port works, power plants.

Project Construction Cost Professional Fees

P10 Million and less 8%
Over P10 Million to P20M P800,000 plus 7.5% of excess of
P10M
Over P20 Million to P30M P1,550,000 plus 6.5% of excess
of P20M
Over P30 Million P2, 200, 000 plus 5.5% of
excess of P30M

Minimum Compensation for Civil Engineer as

Professional NOT Prime.

Group IV -Hotels, large apartment buildings, shopping centers,

resorts, hospitals, and comparable projects.
Project Construction Cost Engineer’s Fees
P10 Million and less 1.05%
Over P10 Million to P20M P105,000 plus 0.975% of excess
of P10M
Over P20 Million to P30M P202,500 plus 0.825% of excess
of P20M
Over P30 Million P285,000 plus 0.675% of excess
of P30M