CHARGING FOR

CIVIL
ENGINEERING
SERVICES
JOHNALYN G. NESUS

CHARGES FOR CIVIL ENGINEERING SERVICES ARE

USUALLY COMPUTED USING ONE OF THE SIX
METHODS
SALARY COST TIMES MULTIPLIER PLUS DIRECT
NON-SALARY EXPENSE (REIMBURSABLES)
HOURLY BILLING RATES PLUS REIMBURSABLES
PER DIEM
COST PLUS FIXED FEE (CPFF)
FIXED PRICE
PERCENTAGE OF CONSTRUCTION COST
(PERCENTAGE)

SALARY COST TIMES MULTIPLIER PLUS DIRECT NON-SALARY

EXPENSE (REIMBURSABLES)

-frequently used method of determining charges

for
engineering services
-based mainly on direct salaries
Multiplier times salary cost (two multiplier
version)
Multiplier times direct salary cost (single
multiplier version)
-direct labor times multiplier version
-it applies a single multiplier to unburden direct
labor
cost

CIVIL ENGINEERS OVERHEAD which comprises a

major portion of the compensation generated by the
multiplier on salary cost includes the following indirect
costs:
a. Provisions for office expenses
b. Taxes and insurance
c. Library and periodical expenses
d. Executive, administrative, accounting, legal,
stenographic and clerical salaries and expenses
e. Business development expenses
f. Provision for loss of productive time of technical
employees between assignments
g. Cost of acquiring and maintaining computers

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 expenditures.

HOURLY BILLING RATES PLUS

REIMBURSABLES
-includes all direct personnel expense, overhead
and profit

PER DIEM
-this term normally refers to an eight-hour day.
This basis is particularly suited to expert witness
or other legal-type services and to other short
term engagements involving intermittent personal
services.

COST PLUS FIXED FEE (CPFF)

-civil engineer is reimbursed for the actual cost
of all services and supplies related to the project
including:
a. Salary costs
b. Overhead
c. Direct non-salary expenses
d. Fixed fee

FIXED PRICE
-frequently used for investigations and studies
and for basic services on design type projects
where the scope and complexity of the assignment
are clearly and fully defined.
-can be calculated as the sum total of estimated
engineering costs for salaries, overhead and nonsalary expenses, an allowance for contingencies,
interest on invested capital, readiness to serve,
and a reasonable amount for profit.

PERCENTAGE OF CONSTRUCTION COST

(PERCENTAGE)
-seldom used now. Because of increasing
complexity and large variation in tasks for projects,
the percentage of construction cost fee curves no
longer have a direct correlation to the required
engineering fees for specific projects.
-may be used to determined the compensation of
the engineer for services where the principal
responsibility is the detailed design or construction
supervision of facilities to be constructed.

The percentage fee shall consider the type,

complexity, location, and magnitude of
construction cost of the project and shall not
exceed the ff. percentages of estimated
construction cost:
a. Feasibility studies (3%)
b. Detailed engineering design (6%)
c. Detailed architectural and engineering design
(8%)
d. Construction supervision (10%)

SCHEDULE OF MINIMUM BASIC FEES

1. When doing work on foreign assisted projects, or in
projects where international consultants participate, the
civil engineer performing similar or equivalent work,
should accept compensation that approximates the
international standard rates (see Section 6.1.1 of the NEDA
guidelines)
2. civil engineers regularly employed in the private
sector shall a minimum compensation corresponding to 10
% more than the minimum wage prevailing in the region as
basic monthly salary. Civil engineers employed in the
government sector shall have a minimum basic monthly
salary corresponding to appropriate entry positions
provided by the Civil Service Commision

3. A civil engineer employed in the private sector

who signs and seals the civil engineering plans,
specifications, and other related documents of a
certain project for and in behalf of his employers,
shall be compensated with a minimum of 10% of
the professional fee for the project over and above
the basic monthly salary

FINISHED !!!!!