Glossary

Liquidated damages

Liquidated damages are a contract amount charged per day (or other period) when the contractor misses an agreed completion milestone. They are a negotiated daily cost, not a court-awarded penalty by default.

Worked example

A hypothetical city library contract lists $5,000 per calendar day after the substantial completion date. A ten-day late finish creates $50,000 of liquidated damages exposure on paper.

Related terms

• Critical path
• Schedule float
• Adjusted contract value

Keep reading: The real cost of a 14-day schedule slip.