Source: https://www.quantsurv.com/resources/glossary/compensation-event Content format: Markdown version of the public page. Content reviewed: 2026-09-30 # Compensation event: definition and example An NEC event assessed under the contract for effects on price, time or both; entitlement depends on its rules and facts. By [Jack Butler-Kettle]() ยท Updated 30 September 2026 Guidance for England and Wales. Check the contract, amendments and facts that apply to your job. ## What it means in practice Read this alongside [the NEC Dictionary of Terms](). Under NEC, a compensation event is assessed through the contract's change machinery. Notification, quotation and assessment have separate roles. An early warning does not necessarily notify a compensation event, and entitlement to time or money depends on the event and the applicable terms. Preserve the instruction, notice and assessment assumptions. [Compensation event recovery]() can help organise the event and its supporting calculation. ## Worked example ### The facts An instruction changes a subcontractor's agreed installation route under an NEC subcontract. ### What happens 1. The subcontractor checks the event and notification provisions in its own subcontract. 2. Its quotation explains the affected work, forecast resources and any programme effect. ### What this shows The quotation connects the event to its effects instead of treating every extra cost as automatically recoverable. ## Sources 1. [NEC Dictionary of Terms](). NEC Contracts.