CHARGING FOR

CIVIL
ENGINEERING
SERVICES
 6.1
GENERAL
The method or combination of methods
used depends upon:
a. Nature,
b. scope, and
c. Complexity of services
 Scope of services is not
self-defined:
a. Salary cost times multiplier plus direct
non-salary expense (“Reimbursable”)
b. Hourly billing rates plus reimbursements
c. Per diem
d. Cost plus fixed fee (“CPFF”)
Scope of services is be well
self-defined:

e. Fixed price
f. Percentage of construction cost
(“Percentage”)
Client-engineer agreement:
Clear agreement on adjustments to "not to
exceed" amounts, scope revisions, and
communication milestones is crucial for
successful project management.
Unique Qualifications and Expertise:
Engineers with unique qualifications,
expertise, or tools may propose value
pricing, which reflects premium rates
based on the engineer's unique qualities or
project circumstances.
 Value Pricing Examples:
Examples of value pricing include tasks such
as providing expert witness services.
 6.2
SALARY COST TIMES MULTIPLIER PLUS
DIRECT NON-SALARY EXPENSE
 What is Salary Cost Times
Multiplier plus Direct Non-salary
Expense?
The civil engineer reach an agreement with the client
on salary ranges for each classification of service
applicable, as well as on the time period over which
they can be guaranteed.
2 TYPES OF SALARY COST
TIME MULTIPLIER
METHOD
Multiplier times salary cost (two
multiplier version)

Multiplier times direct salary cost (single

multiplier version).
 TWO MULTIPLIER
VERSION
It applies a single multiplier to
unburdened direct labor cost.
Ex: direct salaries without
employee benefits
 SINGLE MULTIPLIER
VERSION

Single multiplier includes costs associated with

employee.
Ex: benefits, margin for contingencies, risk and
profit.
 Factors that are
pertinent to the salary
cost times multiplier
version of this method:
 SALARY COST:
Defined as “direct salaries plus
employee benefits” and includes
salaries for partners
or principals and for technical,
professional, administrative and
clerical staff
 MULTIPLIER:
factor that compensates the civil engineer
for overhead (as defined hereafter) plus a
reasonable margin
for contingencies, interest or invested
capital readiness to serve, and profit.
 DIRECT NON-SALARY EXPENSE:
Incurred in engineering engagements may include the following:
a) Living and traveling expenses
b) Identifiable communications expenses
c) Expenses for services and equipment
d) Drafting, Stenographic supplies and reproduction work expense
e) Expenses for unusual insurance
 ACCOUNTING RECORDS:

Must provide the accounting necessary to

segregate and record the appropriate
expenditures.
THANK
YOU