CHAPTER 1.

CIVIL ENGINEERING CODE OF ETHICS

Civil engineers uphold and advance the integrity, honor, and dignity of the civil engineering
profession by:
1. Using their knowledge and skill for the enhancement of human welfare and the
environment;
2. Being honest and impartial and serving with fidelity the public, their employers/employees
and clients;
3. Striving to increase the competence and prestige of the civil engineering profession; and
4. Supporting the professional and technical societies of their disciplines
1.1 FUNDAMENTAL CANONS
CANON 1. Civil Engineers shall hold paramount the safety, health, and welfare of the public
and shall strive to comply with the principles of sustainable development in the performance
of their duties.
a. People’s lives and safety are dependent upon our judgment as engineers.
b. Do not readily sign or approve plans and specifications that are not thoroughly reviewed
by you or by engineers under you.
c. Shall your judgment be overruled, thus posing a threat to people’s welfare, it is your
responsibility to inform your client of the said consequence
d. If you believe that another civil engineer or group of engineers are in violation of CANON
1, you have the responsibility to inform proper authority.
e. Your goals as civil engineer should always be for the advancement of the safety, health,
and well-being of the people, and the protection of the environment through the practice of
sustainable development.
CANON 2. Civil Engineers shall perform services only in areas of their competence.
a. Perform engineering assignments only when qualified by education or experience in the
technical field of engineering involved.
b. Performing engineering assignments outside of our qualification may only be done when
the project is divided into different phases and a certain phase includes our competence.
c. Do not sign and seal documents that are outside your competence.
d. Civil Engineers shall not use The Specialty Engineering Title such as Structural Engineer,
Transportation Engineer, Water Engineer, Geotechnical Engineer, Construction Engineer,
etc. without the PICE Specialist Accreditation.
CANON 3. Civil Engineers shall issue public statements only in an objective and truthful
manner.
a. Extend the public knowledge of civil engineering and sustainable development, and shall
not participate in the dissemination of untrue, unfair, or exaggerated statements regarding
civil engineering.
b. Be objective and truthful in professional reports, statements, or testimony.
 c. When serving as expert witnesses, express civil engineering opinion only when it is
founded upon adequate knowledge of the facts.
d. Do not issue statements, criticisms, or arguments on civil engineering matters which are
inspired or paid for by interested parties, unless these parties are indicated.
e. Be dignified and modest in explaining their work and merit, and will avoid any act tending
to promote their own interests at the expense of the integrity, honor, and dignity of the civil
engineering profession.
CANON 4. Civil Engineers shall act in professional matters for each employer or client as
faithful agents or trustees, and shall avoid conflicts of interest.
a. Avoid all known or potential conflicts of interest.
b. Do not accept compensation from more than one party for services on the same project or
for services pertaining to the same project, unless the circumstances are fully disclosed to
and agreed to by all interested projects.
c. Do not accept gratuities from parties working on or related to the project.
d. Civil Engineers in public services as members, advisors, or employees of a governmental
body or department shall not participate in consideration or actions with respect to services
solicited or provided by them or their organization in private or public engineering practice.
e. Advise your employers or clients when you, as a result of studies, believe a project will not
be successful.
f. Do not use confidential information coming to them in the course of your assignments as
a means of making personal profit at the expense of clients, employers, or the public.
g. Professional employment outside of regular work should be disclosed to the employer.
CANON 5. Civil Engineers shall build their professional reputation on the merit of their
services and shall not compete unfairly with others.
a. Do not give, solicit, or receive any political contribution, gratuity or unlawful consideration
in order to secure work, exclusive of securing salaried positions through employment
agencies.
b. Negotiate contracts for professional services fairly and on the basis of demonstrated
competence and qualifications for the type of professional service required.
c. Civil Engineers may request, propose, or accept professional commissions on a contingent
basis only under circumstances in which their professional judgments would not be
compromised.
d. Do not falsify or permit misrepresentation of your academic or professional qualifications
or experience.
e. Give proper credit for engineering work to those whom credit is due. Whenever possible,
they shall name the person or persons who may be responsible for designs, inventions,
writings, or other accomplishments.
f. Civil Engineers may advertise professional services in a way that does not contain
misleading language or is in any other manner derogatory to the dignity of the profession.
g. Do not maliciously or falsely injure the professional reputation, prospects, practice, or
employment of another engineer.
 h. Do not use equipment, supplies, laboratory, or office facilities of your employers to carry
on outside private practice without the consent of their employers.
CANON 6. Civil Engineers shall act in such a manner as to uphold and enhance the honor,
integrity, and dignity of the civil engineering profession.
a. Do not engage in business or professional practices of a fraudulent, dishonest, or unethical
nature.
CANON 7. Civil Engineers shall continue their professional development throughout their
careers, and shall provide opportunities for the professional development of those Civil
Engineers under their supervision.
a. Engage in professional practice, participate in continuing education courses, read various
technical literatures, and attend professional meetings and seminars.
b. Encourage their engineering employees to become registered at the earliest possible date.
c. Encourage engineering employees to attend and present papers at professional and
technical society meetings.
d. Uphold the principle of mutually satisfying relationships between employers and
employees with respect to terms of employment including professional grade descriptions,
salary ranges, and fringe benefits.
CHAPTER 2. THE PRACTICE OF CIVIL ENGINEERING
2.1 CLIENT-CIVIL ENGINEER RELATIONSHIPS
Obligations of the Civil Engineer
1. Perform the agreed upon scope of the services.
2. Exercise reasonable skill, care, and diligence in the performance of obligations.
3. Act independently and, as required by the contract, perform with the necessary skills and
professional judgment, when required to certify, decide, or exercise discretion between the
client and a third party with whom the client has a contract.
4. Authorized to act as the client’s faithful agent when required but only as implied in the
contract adopted for the project.
5. When aware of any matters which will change or has changed the scope of the services,
the civil engineer shall give written notice to the client containing particulars of the change.
6. For specified staged services, the civil engineer shall not initiate or proceed with any
subsequent stage of the services without the approval of the client.
7. Direct and cooperate with all other professionals and integrate their work where applicable,
but shall not be professionally liable for their (other professionals’) work
8. May recommend specialist suppliers and/or contractors to design and execute certain parts
of the works, but the civil engineer shall be relieved of all responsibility for the design,
manufacture, installation, and performance of any such parts of the works. The civil
engineer shall not be liable for acts of negligence, default, or omission by such person or
persons.
9. Notify the client of any interest the civil engineer has which may significantly conflict with
the interests of the client under their contract.
Obligations of the Client
1. Pay the civil engineer for his services, with the amount determined in their agreement.
2. Provide the civil engineer within reasonable time all information required by the civil
engineer in the performance of his services.
3. Cooperate with the civil engineer and shall not interfere with or obstruct the proper
performance of the services.
4. Make arrangements that enable the civil engineer to enter the site and inspect facilities
needed in the performance of his services.
5. Arrange for the provision of services from other professionals or others as may be required
and bear all costs.
6. When the civil engineer is required to administer the work of other professionals on behalf
of the client, all instructions by the client shall be given through the civil engineer.
7. When aware of any matter which will change or has changed the scope of the civil
engineer’s services, the client shall notify the particulars of the change.
Liability of the Civil Engineer and the Client
Limitation of Civil Engineer’s Responsibility
1. The civil engineer shall have no responsibility or liability for costs, loss, or damage of
whatsoever nature arising from any errors in or omission from data, documents, plans,
design, or specifications not prepared by the civil engineer or other personnel under the
direct control of the civil engineer.
2. Notwithstanding any recommendation or lack of recommendation made by the civil
engineer to the client, the civil engineer shall not be held to have made any warranty or
promise as to the suitability, competence, or performance of any other consultant,
contractor, supplier, or other third party.
3. The civil engineer shall not be responsible for the techniques, method, programmes,
sequences, or procedures adopted by any contractor or other third party responsible for
executing any aspects of the project.
Damages
If found that the civil engineer undertaking services is liable to the client, damages shall be payable
on the following terms
1. Damages payable shall be limited to the amount of reasonably foreseeable loss and damage
suffered as a direct result of such breach.
2. The maximum amount of damages payable in respect of liability, whether under the law or
contract, or otherwise, is limited to the amount specified in the specific provision or, if no
such amount or provision is specified, to the lesser of P300,000 or 10% of the total amount
of damages of the portion of the work attributable to the civil engineer’s breach of duty or
25% of the total of fees payable under their agreement
3. If found to be liable, in circumstances where the acts or omissions of a third party have
contributed to the loss or damage, the proportion of damages payable by the party found
liable shall be limited to that proportion which is attributable to that party’s breach of duty,
whether the claims are made under contract or otherwise
2.2 CIVIL ENGINEERING SERVICES
1. Design, consultations and advice
2. Feasibility studies
3. Field investigations and engineering data collection
4. Environmental assessments, impact statements or engineering reports
5. Opinions of probable construction cost
6. Preliminary and final designs, drawings, specifications, and construction bidding
documents
7. Assistance in securing construction bids and in awarding contracts
8. Construction administration and observation
9. Arrangements for or performance of testing of materials and equipment
10. Assistance in start-up, assessment of capacity, and operation of facilities
 11. Preparation of operation and maintenance manuals
12. Appraisals and rate studies
13. Value engineering
14. Expert testimony
15. Assessment of risks
16. Structural remediation or rehabilitation
17. Project management and controls
18. Provision of supplemental temporary staff
19. Teaching
2.3 SPECIALIZATION IN CIVIL ENGINEERING
Five specializations recognized by PICE
1. Structural engineering
2. Geotechnical engineering
3. Water engineering
4. Transportation engineering
5. Construction management and engineering
CHAPTER 3. CLASSIFICATION OF ENGINEERING SERVICES
The needs for professional civil engineering services vary, and the civil engineering firms that
meet these needs vary in organizational structure, size, and capability. Many civil engineering
firms provide comprehensive services to the client, while other firms specialize in areas of
engineering. Few engineering firms are qualified to provide complete service for all projects, and
the use of associate professionals to provide specialized services is common. Civil engineering
services are broadly categorized below.
3.1 CONSULTATIONS, RESEARCH, INVESTIGATIONS, AND REPORTS
To better understand numbers 1 – 4, consider a civil engineer consulted by a businessman in
constructing a row of studio apartments for rent. The civil engineer’s job may include
1. Preliminary and Feasibility Investigations and Reports
Before starting a project, feasibility studies are done. These include costs, expected
revenues, environmental impact, impact to the community, etc.
2. Planning Studies
These include preparation of land development plans, urban plans, and regional plans that
require various engineering disciplines.
3. Appraisals, Valuations, and Rate Studies
Focus on evaluating costs to determine possible rate that will give a reasonable revenue.
4. Assistance in Financial Matters
Evaluation of the businessman’s capabilities in actually finishing the project given his
facilities, equipment, etc. Providing construction costs, evaluation of facilities and
equipment to meet present and future needs.
5. Materials Engineering and Equipment Tests
Tests of materials and equipment under established codes and standards, specialized
examination of equipment and materials used in construction and industry, and other
inspections and monitoring required by a client
6. Direct Personal Services
Services such as assistance in preparation for legal proceedings
7. Research and Development
a. Development of new construction materials and methods from concept to
commercialization
b. Improvement of construction materials and methods through exhaustive studies to
reduce total construction cost and at the same time improve quality
3.2 DESIGN SERVICES FOR CONSTRUCTION PROJECTS
1. Study and Report Phase – analysis of the client’s needs, conceptual design, and opinions
of probable construction cost.
a. Reviewing available data and consulting with the client to clarify and define the client’s
requirements for the project
b. Advising the client as to the necessity of providing or obtaining from others additional
data or services and assisting the client in obtaining such data and services
 c. Identifying and analyzing requirements of governmental authorities having jurisdiction
to approve the design of the project
d. Providing analyses of the client’s needs, evaluations of prospective sites and solutions
e. Providing a general economic analysis of the client’s requirements
f. Preparing a report and presenting alternative solutions available to the client
2. Preliminary Design Phase – this phase involves the establishment of the general size and
scope of the project and its location on the selected site
a. Consulting with the client, reviewing preliminary reports, clarifying and defining the
project requirements, reviewing available data, and discussing general scheduling
b. Advising the client as to whether additional data or services of the type described under
the study and report phase above are required
c. Preparing preliminary design documents
d. Preparing revised estimates of probable total project costs
e. Providing periodic status reports
3. Final Design Phase – this phase of project development is usually undertaken only after
the client has approved the preliminary design phase material
a. Preparing construction drawings and specifications
b. Preparing and furnishing to the client a revised estimate of probable total project costs
c. Assisting in the application for regulatory permits from local or national authorities
d. Preparing basic documents related to construction contracts for review and approval by
the client
e. Providing periodic status reports
4. Bidding or Negotiating Phase
a. Assisting the client in advertising for and obtaining bids or negotiating proposals for
each separate prime construction contract, maintaining a record of prospective bidders
to whom bidding documents have been issued, attending pre-bid conferences, and
receiving and processing deposits for bidding documents
b. Issuing addenda as appropriate to interpret, clarify, expand, or amend the bidding
documents
c. Assisting the client in determining the qualifications and acceptability of prospective
contractors, subcontractors, and materials suppliers
d. Consulting with and advising the client as to the acceptability of alternative materials
and equipment
e. Attending the bid opening, preparing bid tabulation sheets, and providing assistance to
the client in evaluating bids or proposals
5. Construction Phase – involve the consulting with and advising the client during
construction
a. Reviewing for compliance with design concepts, shop, and erection drawing submitted
by the constructors
b. Reviewing laboratory test reports on materials and equipment
c. Visiting the project site at appropriate intervals as construction proceeds to observe and
report on the progress and the quality of the executed work
 d. Issuing instructions from the client to the contractors, issuing necessary interpretations
and clarifications of contract documents, preparing change orders, requiring special
inspections and testing of the work, and making recommendations as to acceptability
of the work
e. Making recommendations to the client on corrective actions or contractual measures
that may be exercised by the owner
f. Preparing sketches required to resolve problems due to actual field conditions
encountered
g. Determining amounts of progress payments due, based on degree of completion of the
work
h. Observing and assisting performance tests and initial operation of the project
i. Preparing record drawings from information submitted by the contractor
j. Making final inspection and reporting on completion of the project, including
recommendations concerning final payments to contractors and release of retained
percentages
6. Operation Phase – at the completion of construction, the civil engineer may as a basic
service, assist in the start-up of project operations.
a. Prepare a manual for both operation and maintenance requirements, and may also
provide assistance in adjusting and balancing equipment, identifying deficiencies and
assisting in obtaining corrections, and performing inspection prior to the end of the
project warranty period.
b. Assist in operator training, setting up job classifications and salaries, organizing the
purchase of supplies developing charts for recording operational data, and observing
and reporting on project operations
3.3 CONSTRUCTION SERVICES
A registered civil engineer may engage in construction contracting after being licensed as a
contractor by the Contractors Accreditation Board. It is considered unethical for a civil engineer
to allow his license to be used by any other construction company except his own.
A registered civil engineer may provide the services of a supporting technical employee as required
of a construction company. He shall be paid the professional fees in addition to his regular salary
for any design work he performs for which he signs as a professional civil engineer.
A civil engineer may be employed as a construction engineer, resident civil engineer, project
engineer, quality control engineer, cost engineer, or engineer inspector in a project. In accordance
with Section 23 of RA 544 (to be discussed in the next chapters), only registered civil engineers
can take charge or supervise construction or alteration of any building or structure and any other
civil engineering works mentioned in Section 2 of the mentioned Republic Act. The civil engineer
when employed is similarly required to comply with the code of ethics of the profession as the
consulting civil engineer.
Special Services for Construction Projects
Special services required during the study, design, construction, and operation phases of a
construction project may include investigations, reports, and activities beyond the scope of the
basic services. The research, compilation of engineering data, and acquisition of property may
involve professional specialists in engineering and other fields.
1. Geotechnical engineering – including test borings, sampling and analysis, and
recommendations
2. Special studies, tests, and process determinations to establish design criteria or demonstrate
compliance
3. Land surveys, establishment of boundaries and monuments, preparation of easement
descriptions, and related computations and drawings
4. Engineering and topographic surveys for design and construction
5. Mill, shop, or laboratory inspections of the materials and equipment
6. Additional copies of reports, construction drawings, specifications, and other documents
as required for bidding and construction beyond the number specified in the basic services
agreement
7. Extra travel and subsistence as defined by the agreement for engineering services
8. Value engineering – including review of the work of other engineers, either within the same
organization or in other firms to determine whether a proposed solution is optimum and, if
not, to suggest a better approach for meeting the project’s functional and financial criteria
9. Redesign to reflect changes requested by the client or necessitated by the client’s
acceptance of substitutions proposed by the contractor
10. Assistance to the client as an expert witness in litigation in connection with the project or
in hearings before approving and regulatory agencies
11. Final investigations involving detailed consideration of operation, maintenance, and
overhead expenses
12. Preparation of detailed applications and supporting documents grants or advances for
public works projects
13. Plotting, computing, and filing of subdivision plans, staking of lots, and other land planning
and partitioning activities
14. Preparation of environmental assessment and impact statements and other assistance to the
client in connection with public hearings
15. Additional studies and design efforts to meet special conditions encountered during
construction
16. Assistance to the client in the selection and engagement of architects, other engineers,
contractors, and subcontractors, and observation and approval of their services or work.
17. Assessment of a completed project’s ability to meet its design intent relative to capacity,
maintainability, operability or reliability
18. Computer simulation and modeling
Engineering Support Services
The professional services described above often require engineering support services.
Geotechnical engineering, for example frequently required services such as taking soil and rock
borings, excavating test pits sampling and identifying soil and earth materials, field and laboratory
tests and geophysical measurements and observations. The engineering support services in general
civil engineering practice may involve drafting, land and construction surveying, and other data
gathering activities for specialized purposes. Although persons who are not civil engineers
sometimes accomplish some of these tasks, the procurement of adequate and correct data usually
requires professional civil engineering judgment and guidance. Since soundness of any
engineering decision is dependent upon the accuracy and suitability of data obtained in field and
laboratory investigations, these supporting services must be under the guidance of the civil
engineer whose decisions will be based upon those data.
3.4 ACADEMIC SERVICES
These services involve full or part time teaching or training of prospective professionals and also
the upgrading of knowledge and skills of fellow professionals
a. Teaching of civil engineering courses in engineering colleges/universities on part/full time
basis. As per RA 8981, all subjects for licensure examinations shall be taught by persons
who are holders of valid certificates of registration/professional licenses and professional
identification cards, or special temporary permits, or a valid certificate of competency for
the profession issued by the commission, and who comply with the other requirements of
CHED.
b. Lecturing in civil engineering courses designed by PICE for practicing engineers who want
to obtain CPD credits
c. Conducting tutorials/refresher courses on civil engineering concepts and related subjects
d. Serving as a resource speaker in technical session
e. Writing technical articles and pamphlets
3.5 SERVICES AS EMPLOYEE
This is a condition when a civil engineer engages to perform work or fulfill duties regularly for
wages or salary being paid by an employer.
A civil engineer may be employed for any position or function in any commercial or institutional
organization. Where he is performing civil engineering functions, he is required to follow the code
of ethics for civil engineers and comply with the standards and guidelines. A licensed civil engineer
may not allow his license to be used by the company that employs him without the proper
agreement for his professional services. Where the firm he is working for uses his license to sign
and seal the plans, specifications and contract document, the civil engineer must charge the
professional fee for said services.
A civil engineer in part time employment with a firm is considered to be an employee and at the
same time a consultant of the firm.
Any civil engineer employed as an individual consultant of any firm, whether the firm is
performing engineering, commercial, administrative, management, or financial services is
required to comply with the requirements and the standards established for a consulting civil
engineering firm or consulting civil engineer.
CHAPTER 4. SELECTION OF THE CIVIL ENGINEER
The selection of a civil engineer is an important decision to be made for an engineering project to
come to fruition.
4.1 BASIS FOR SELECTION
Basic questions that a client needs to be answered when selecting the most appropriate civil
engineer are:
1. How is this civil engineer’s reputation? How has the engineer dealt with its previous
clients?
2. Is the civil engineer duly registered?
3. What is the civil engineer’s field of expertise?
4. How about its staff? Are they able to provide my needs given the size of their group?
5. Can the civil engineer finish the project with its financial capability and resources?
The questions above are mostly applicable to projects of the private sector. For government
projects, E.O. 164 and PD 1594 (to be discussed in the future) apply to procurement of consulting
services and selection of contractor.
4.2 QUALIFICATION-BASED SELECTION (QBS) PROCEDURE
Below are the steps that the client should undertake when selecting the civil engineer.
1. By invitation or by public notice, state the general nature of the project, the services
required, and request statements of qualifications and experience from civil engineers who
appear to be capable of meeting the project requirements. The client may issue a Request
for Qualifications (RFQ) or Request for Proposals (RFP). RFQs – if you are looking for
an engineer well versed in a certain area of expertise; RFPs – if you are looking for a civil
engineer with a good project proposal.
2. Prepare a budget for the staff time and costs that can be expected from potential civil
engineer prior to receipt of the RFQs and RFPs.
3. Evaluate the statements of qualifications received. Select at least three civil engineers or
firms that may appear to be best qualified for the specific project.
4. Write a letter to each civil engineer describing the proposed project in detail, including a
project scope and outline of services required, and asking for a proposal describing in detail
the civil engineer’s plan for managing and performing the required services, the personnel
to be assigned, the proposed schedule, experience with similar projects, office location in
which services are to be performed, financial standing, present workload, and references.
Each civil engineer or firm should have an opportunity to visit the site, review all pertinent
data and obtain clarification of any items as required.
5. On receipt of proposals, invite the civil engineers or firms to meet individually with the
selection committee for interviews and discussions of the desired end results of the project
and the engineering services required.
6. Check with recent clients of each civil engineer or firm to determine the quality of their
performance. This check need not be limited to references listed by the civil engineer.
 7. List the civil engineer or firms in order of preference, taking into account their approach
and understanding of the project, reputation, experience, financial standing, size, personnel
available, quality of references, workload, location, and other factors pertinent to the
project being considered.
8. Invite the civil engineer considered to be best qualified to develop a detailed scope. List of
deliverables and schedule, and to negotiate fair compensation for the services.
9. The compensation proposed by the civil engineer should be evaluated on the basis of the
client’s experience and budget estimate, taking into account the range of charges reported;
giving consideration to the project’s special characteristics and the scope of services agreed
upon. Fair and reasonable compensation to the civil engineer is vital to the success of the
project since it will enable the consultant’s expertise to be fully utilized.
10. If satisfactory agreement is not reached with the first civil engineer, the negotiations should
be terminated and the civil engineer or firm be notified in writing to that effect. Similar
negotiations should then be held with the second civil engineers or firm, and, if necessary,
with the third civil engineers or firm. If no accord is reached, the client should seek outside
assistance before continuing with the selection process. Such a procedure will usually result
in development of a satisfactory contract. All such negotiations should be on a strictly
confidential basis, and in no case should the compensation discussed with one civil
engineer be disclosed to another.
11. When agreement has been reached on scope, schedule, and compensation, the client and
selected civil engineer should formalize their agreement in a written contract.
4.3 SELECTION PROCEDURE FOR “LEVEL OF EFFORT” CONTRACTS
A “level of effort” type of contract for engineering services is a contract procedure used to
supplement a client staff, either by providing an extension to existing disciplines and capabilities
already on board or by adding special disciplines not available on the client’s staff.
As applied to “level of effort” contracts, the QBS procedure sets forth the general nature of services
to be rendered, the types of specialists required and the estimated number of hours required during
the contract period for each type and grade of specialist and then requests proposals from qualified
firms. Proposals usually state the experience of the firm as it pertains to the given scope of services,
and the backgrounds of the specialists available to work on the project. After narrowing the
proposals to those which best meet the experience qualifications, the client negotiates an
agreement as described in paragraphs 9-11 above.
Bidding
Professional engineering and architectural societies recognize QBS as the preferred method for
procurement of professional services. In fact, the NEDA guidelines require the procurement of
professional engineering and architectural services only by a process similar to that described in
QBS above.
Selection of civil engineers and related service professionals, including consultants and sub
consultants on construction projects, should result from competition based on the qualifications
and resources best suited to complete a project successfully in terms of performance quality and
cost-effectiveness. Qualifications and resources, including training, professional licensing
experience, skills, capabilities, special expertise personnel, and workloads, are paramount
considerations in engaging engineering services. Costs of these services, while important and
meriting careful negotiations and performance accountability, are a small portion of overall project
costs and should be subordinate to professional qualifications and experience.
There are many reasons why bidding for consulting civil engineering services often produces
unsatisfactory results for the client. Principal among these are:
1. Bidding does not recognize professional judgment, which is the key difference between
professional services and the furnishing of products. Judgment is an essential ingredient in
quality engineering services.
2. It is virtually impossible to completely detail in advance the scope of services required for
an engineering project especially for the study and preliminary phases without lengthy
discussions and negotiations with the selected firm. Lacking specifics, the bidding firms
must submit a price for the least effort envisioned. The resulting service performed is likely
to be tailored to fit the minimal requirements of the bid documents and will not necessarily
suit the client’s needs or expectations.
3. In-depth studies and analyses by the consulting civil engineer are not likely to be
performed. The consulting civil engineer selected by lowest bid will often provide only the
minimum services necessary to satisfy the client’s scope of services.
4. The consulting civil engineer’s ability to be flexible and creative in meeting the client’s
requirements is severely limited.
5. The engineering designs are likely to be minimal in completeness with the details left to
the contractor. This produces a lower first cost design but tends to add to the cost of the
completed project. The lack of design details can also lead to a greater number of change
orders during construction and to contractor claims at a later date.
Two-Envelope System
The two-envelope system involves submission of a technical proposal in one envelope and a price
proposal in a second envelope. The client then evaluates the technical proposals and selects the
best qualified civil engineer based on that consulting civil engineer’s technical proposal. At this
point in the selection procedure, the client opens the price proposal submitted in the second
envelope and uses this as a basis for negotiation of contractual scope and fees. The second
envelopes submitted by the unsuccessful proposers are returned unopened.
If the client follows this procedure, the net effect is outlined it QBS provided that the client and
best qualified consulting civil engineer have extensive discussions to reach full agreement on the
scope of services. This allows the client to utilize the knowledge and experience of the consulting
civil engineer in establishing the scope of services. Upon agreement of scope, the price of services
should be negotiated to reflect changes from the original scope used for obtaining proposals.
If both envelopes of all proposers are opened at the same time, a bidding process is initiated with
attendant disadvantages. Procedures should be established to provide confirmation that the second
envelope is opened for only the successful proposal.
The two-envelope system is not recommended. If used as intended, it is similar to the
recommended QBS procedure except that the added cost to prepare a comprehensive scope and
price discourages some consulting civil engineers from participating. The costs to prepare a proper
price proposal are considerable to the firms not selected, which increases the overall business costs
of consulting civil engineering and ultimately of the clients.
CHAPTER 5. CHARGING FOR CIVIL ENGINEERING SERVICES
5.1 SALARY COST TIMES MULTIPLIER PLUS 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. With this method, charges for engineering
services are based mainly on direct salaries. It is therefore advisable that the civil engineer reach
an agreement with the client on salary ranges for each classification of services applicable, as well
as on the time period over which they can be guaranteed. This may help avoid future surprises,
misunderstandings, and disputes.
A provision in the agreement should state that payments will be made to the civil engineer during
progress of the services, based on monthly invoices, and within a reasonable time after billing.
Direct non-salary expenses are a separate item for reimbursement usually with a service charge.
The following factors are pertinent to the salary cost times multiplier version of this method.
1. Salary cost is defined as “direct salaries plus employee benefits” and includes salaries for
partners and principals and for technical, professional, administrative, and clerical staff
directly. Chargeable to the project: sick leave, vacation, holiday, and incentive pay;
unemployment and other payroll taxes; and contributions for social security, workers’
compensation insurance for retirement, medical, and other group benefits.
2. Multiplier which is applied to salary cost is a factor that compensates the civil engineer for
overhead plus a reasonable margin for contingencies, interest, or invested capital readiness
to serve and profit. 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 and 3.0 times the average salary cost. For
some services, however, a higher multiplier is usually applicable for services requiring
recommendations based on extensive experience and special knowledge, or for services
involving expert testimony in legal proceedings. The multiplier may also increase with the
experience and special capabilities of the civil engineer’s firm.
3. Direct non-salary expenses usually incurred in engineering engagements may include the
following:
a. Living and traveling expenses of principals and employee’s when away from the home
office on business connected with the project
b. Identifiable communications expenses, such as long-distance telephone, facsimile,
telegraph, shipping charges, and special postage charges
c. Expenses for services and equipment directly applicable to the project, such as for
special technical equipment, special legal and accounting services, special computer
rental and programming services, computer run time and file storage, CADD charges,
sub consultants and subcontractors commercial printing and binding, and similar
services that are not applicable for inclusion in general overhead
d. Identifiable drafting supplies, stenographic supplies, and reproduction work
 e. Expenses for unusual insurance and specialized health and safety programs and for
special clothing for projects with extraordinary risks such as toxic and hazardous waste
conditions.
4. The civil engineer’s 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 – electricity, rent, drafting equipment and engineering
instruments, transportation expenses, and office supplies.
b. Taxes and insurance other than those included as salary cost
c. Library and periodical expenses and other costs of keeping abreast of advances in
engineering, such as attendance at technical and professional meetings and continuing
education courses
d. Executive, administrative, accounting, legal, stenographic, and clerical salaries and
expenses
e. Business development expenses, including salaries of principals and employees so
engaged
f. Provision for loss of productive time of technical employees between assignments, and
for time of principals and employees on public service assignments
g. Costs of acquiring and maintaining computers, development of software, and training
staff when not billed as a direct cost
5. 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.
5.2 HOURLY BILLING RATE
The hourly billing rate method of compensation is very similar to the salary cost times multiplier
in that the hourly billing rate includes all direct personnel expense, overhead, and profit. Direct
non-salary expenses (as defined under the salary cost times multiplier section) are a separate item
for reimbursement, usually with a service charge. Civil engineering firms may elect to utilize this
method of compensation on projects where the scope of service is not well defined or to simplify
accounting and record keeping.
5.3 PER DIEM
The term per diem normally refers to an eight-hour day. Direct personal services are frequently
charged on a per diem basis. This basis is particularly suited to expert witness or other legal type
services and to other short-term engagements involving intermittent personal services.
Where per diem services are furnished, the civil engineer should be compensated for all of the time
devoted to providing them, including travel and standby time. The per diem charge should be based
on the complexity, risk, and importance of the services and on the civil engineer’s professional
standing, expertise, and breadth of experience. The civil engineer is also reimbursed for travel and
subsistence costs and for other out-of-pocket expenses incurred when away from the home office.
For engagements in which the civil engineer is to appear as an expert, a per diem charge is
considered to be earned for each day of such appearance, even though the civil engineer is not
called to testify or, if called, may finish testifying in only a part of the day.
On occasion the urgency of the engagement requires the civil engineer’s time regularly for periods
longer than the normal eight-hour day. In such cases an understanding should be reached with the
client, and the per diem rate increased accordingly.
Per diem rates can vary widely, depending on employee classification, regional location and period
of service. Rates for consultation in connection with litigation and appearances before
commissions and courts are normally higher than the standard rates.
5.4 COST PLUS FIXED FEE
Under a cost plus fixed fee agreement, the civil engineer is reimbursed for the actual costs of all
services and supplies related to the project, including
• Salary costs
• Overhead
• Direct non-salary expenses
• Fixed fee, an amount to compensate the civil engineer for contingencies, interest on
invested capital, readiness to serve, and profit
The cost plus fixed fee basis requires that the client and the civil engineer define and agree upon
the scope of services the civil engineer is to perform. Such definition of the scope of service is
essential to enable the civil engineer to estimate costs and propose an equitable fixed fee amount.
The scope of services, cost estimate, and fixed fee should be incorporated into the client-engineer
agreement.
The cost plus fixed fee method can also be used when the civil engineer is required to start
providing service before the detailed scope of services can be determined. In such cases, the
following considerations apply:
1. The general scale and intent of the project should be fairly well defined, even if the full
scope is indeterminate; for example, the number, size, and character of buildings or other
facilities, the type of utilities, and other essential information should be available
2. The types of service to be performed by the civil engineer should be agreed upon and fully
set forth. The agreements should also provide for appropriate adjustments in the fixed fee.
The fixed fee amount varies with the complexity and scope of the engineering services required.
It is frequently calculated as a percentage of the salary costs, overhead, and direct non-salary
expenses.
5.5 FIXED PRICE
The fixed price method of compensation is frequently used for investigations and studies for basic
services on design type projects where the scope and complexity of the assignment are clearly and
fully defined. The fixed price amount can be calculated as the sum total of estimated engineering
costs for salaries, overhead, and non-salary expenses, an allowance for contingencies, interest on
invested capital, readiness to serve, and a reasonable amount for profit. Fixed price compensation
for basic services on certain design-type projects can also be computed as an appropriate
percentage of estimated construction costs.
A fixed price agreement should contain a clearly stated time period during which the services will
be performed and a provision for adjustment of compensation if the project is delayed for reasons
beyond the civil engineer’s control. For design services, there should be a provision for changes
required after approval of the preliminary design, with a clear understanding as to where the final
approval authority lies.
Partial payments should be made to the civil engineer at stated intervals, usually once a month
during the performance of the services. These payments are usually based on the civil engineer’s
statement of percent completion to date.
5.6 PERCENTAGE OF CONSTRUCTION COST
The percentage of construction cost method is seldom used raw. 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. Owners should either
use experienced “in-house” staff or retain consultants to develop detailed program budgets for
construction costs, right of way, legal, administrative, engineering services, and permits.
This method may be used to determine the compensation of the engineer for services where the
principal responsibility is the detailed design or construction supervision of facilities to be
constructed.
Construction cost is defined as the estimated total cost of constructing the facility to be covered by
the proposed detailed design or construction supervision services, excluding the fees and other
costs of such services, the cost of land and right-of-way, and legal and administrative expenses.
Over the years, engineering experience has established some appropriate correlations between
engineering costs and construction costs for certain types of engineering design, where design
procedures and materials of construction are more or less standardized. These correlations have
resulted in various curves and schedules which have been widely used.
The validity of the percentage of construction cost method rests upon the assumption that detailed
design and construction supervision costs vary in proportion to the cost of construction. When
judiciously applied, and with due consideration of the ranges within which engineering scope may
vary, this method is valuable as a tool for general comparison with line-based fees for design
services. Its acceptance over many years also affords a valuable guide for judging the
reasonableness of proposal for consulting services.
The percentage fee shall consider the type, complexity, location, and magnitude of construction
cost of the project and shall not exceed the following percentages of estimated construction cost:
a. Feasibility studies – three percent (3%);
b. Detailed engineering design – six percent (6%);
 c. Detailed architectural and engineering design – eight percent (8%); and
d. Construction supervision – ten percent (10%)
These percentages include only those works normally undertaken in arriving at the expected
outputs and do not include special studies or investigations.
It is further emphasized that the above percentages are only ceilings and it does not necessarily
mean that the said percentages shall always be adopted for each project. The actual percentage for
a particular project will depend on the factors mentioned.
5.7 SCHEDULE OF MINIMUM BASIC FEES
Rates of compensation for civil engineers engaged in various capacities are given*. The PICE shall
regularly update the schedule of fees stipulate. Certain principles should however be observed as
follows
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.
2. Civil engineers regularly employed in the private sector shall have 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 shall have a minimum
basic salary corresponding to appropriate entry positions provided by the Civil Service
Commission.
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.
*For the basic minimum fee, read Manual of Professional Practice for Civil Engineers –
Appendix A.
CHAPTER 6. TOTAL PROJECT COST
Probable total cost is a major concern of the client throughout the planning, design, and
construction phases of a project. The probable total capital cost, often used to establish budgets for
a typical project, is made up of:
1. Professional engineering costs
2. Construction cost
3. Legal and land costs
4. Owner’s costs, including project administration, staffing, financing, and other overhead
5. Contingency allowance for unknowns
6.1 PROFESSIONAL ENGINEERING COSTS
A civil engineer is often engaged to make a study and to render a planning report on the
contemplated project, including alternative solutions, layouts, and locations along with initial
estimates of the probable project cost. These may involve alternative or phased implementation
schemes which add flexibility to the project.
The study and report phase may include the cost for field or traffic surveys, planning analyses,
geotechnical explorations and analysis, in addition, to the direct engineering costs.
The costs of coordination, evaluation implementation, and compliance have increased
correspondingly. The extent of these concerns may not be identified during the study and report
phase and sometimes not even after the final plans and specifications have been prepared. As a
result, the estimated probable cost of the project based on the study and report phase must be
understood to be preliminary in nature.
Because projects vary widely in nature and scope, the study and report phase is important because
its implementation determines the scope and development of the entire project and its ultimate
capital and lifecycle cost. At times, preliminary investigations become extensive and lengthy that
the study and report phase costs as much or more than the final design phase.
During the final design and construction phase, additional surveying and geotechnical engineering
services may be needed. Also special or additional engineering services not originally identified
may be required by the client or recommended by the civil engineer.
6.2 CONSTRUCTION COST
The study and report phase of the project usually includes a preliminary estimate of the
construction cost of the contemplated project and for alternative project configurations. Such cost
estimates are approximate, since the final design drawings and specifications have not yet been
prepared. In addition, the timing of the construction work must be considered because inflation
will affect the construction cost.
Construction cost is the estimated total cost of constructing the facility to be covered by the
proposed detailed design or construction supervision, services, excluding the fees and other costs
of such services, the cost of land and right of way, and legal administrative expenses of the agency.
The estimated construction cost must be approved by the client before the invitation to submit
technical proposal is issued.
6.3 LEGAL, LAND, ADMINISTRATION, STAFFING, AND FINANCIAL COSTS
These costs, which include audits, the cost of issuing bonds, land costs, and interest for borrowed
money during construction, are part of the probable total project cost and can best be estimated in
cooperation with the client because they are usually outside the knowledge and control of the civil
engineer.
6.4 CONTINGENCY ALLOWANCE
As the project moves forward from the study and report phase through the final design phase and
finally to construction award, more becomes known about the project details and costs, until at the
completion of the project, the final project cost becomes a known quantity.
To provide for intangible costs, contingencies should routinely be added to the basic cost estimate.
It is common practice to add 20% or more to the estimated probable total project cost at the
completion of the study and report phase, reducing this to perhaps 10% at the completion of final
design and perhaps to 5% when the construction bids become known. Larger or more complex
projects may require higher contingencies.
CHAPTER 7. RA 544
7.1 ARTICLE I – Title of the Act and Definition of Terms
• RA 544 is known as the Civil Engineering Law
• The practice of civil engineering includes
a. Consultation, design, and preparation of plans and specifications
b. Supervision of the construction of
i. Streets, bridges, highways, railroads
ii. Airports, hangars, and ports
iii. Canals, river, and shore improvements
iv. Buildings
v. Fixed structures for irrigation, flood protection, drainage, water supply, and
sewerage
• A civil engineer is one duly registered with the Board of Examiners for Civil Engineers
7.2 ARTICLE II – Board of Examiners for Civil Engineers
• Members of the board (3) are appointed by the Secretary of Public Works
• Members of the board shall
a. Administer oaths, certificates of registration, certificates of recognition to civil
engineers
b. Investigate violations of this Act
c. Inspect educational institutions offering courses in civil engineering
7.3 ARTICLE III – Examination and Registration
• Applicants for civil engineering registration are to take and pass a technical examination
• Applicants must have the following qualifications:
a. At least twenty-one years of age
b. A citizen of the Philippines
c. Of good reputation and moral character
d. A civil engineering graduate from an educational institution recognized by the
government
• Registered civil engineers shall obtain a seal of such design as the Board shall authorize
and direct
• The Board shall not issue a certificate to any person convicted by a court of competent
jurisdiction of any criminal offense
•
7.4 ARTICLE IV – Enforcement of Act and penal provisions
• No person shall practice or offer to practice civil engineering in the Philippines without
having obtained the proper certificate of registration from the Board
 • A fine of not less than five hundred pesos nor more than two thousand pesos or to suffer
imprisonment of not less than six months nor more than one year shall be imposed on any
person who shall:
a. Practice or offer to practice civil engineering in the Philippines without proper
registration
b. Attempting to use another engineer’s certificate as his own
c. Impersonating any reigistrant civil engineer of different name
d. Using a revoked or suspended certificate of registration
7.5 ARTICLE V – Miscellaneous provisions
• Plans and designs of structures must be approved as provided by law or ordinance of a city
or province or municipality where the said structure is to be constructed