Why renegotiation may be needed
The addendum addresses long-term outsourced-service contracts priced before new or updated PWM wage requirements were announced. Locked prices, extension options and missing termination clauses can leave providers unable to absorb mandatory wage costs. Buyers also face service-continuity risks. The aim is transparent, sustainable best sourcing, not unilateral cancellation.
Responsibilities of providers and buyers
Providers should disclose the additional wage cost, deduct applicable government transitional support and show why the original price cannot absorb the balance. Buyers should assess that evidence rather than insist on the old/reduced price merely because wage support exists. Do not debar providers solely for declining renewal at the old price; consider fair termination for unforeseen unsustainable circumstances. Any contractual change requires mutual agreement.
IFM and future procurement
An IFM contractor may be both provider to an owner and buyer of subcontracted cleaning, security or other services, so the principles apply throughout the chain. For new multi-year contracts, price announced PWM schedules into each year including option years, obtain annual cost breakdowns, agree adjustment triggers and limits, and consider outcome-based contracts that reward quality and productivity. Voluntary mediation can help resolve disputes. The addendum’s PWCS percentages describe its issue period, not a current grant quotation.