METHODS OF COMPENSATION
COMPREHENSIVE LECTURE
Ar. Jomarie Viel Maglunob
STUDY
I. STANDARDS OF PROFESSIONAL PRACTICE DOCUMENT 210
Architect’s Guidelines for Standards of Professional Practice (SPP) Compliances – Methods of
Compensation and Schedule of Fees
*This replaces the 1979 UAP Doc 208-B (Methods of Compensation and Schedule of Fees)
II. THREE MAIN TYPES OF COMPENSATION:
1. Percentage-Based Fee
1.1. Percentage based on Project Construction Cost – Fee is a percentage of the
Project Cost declare at the time of the project.
1.1.1. DAEDS – Detailed Architectural & Engineering Design Services (Assume
this if the type of service is not specified.)
1.1.2. DADS – Detailed Architectural Design Services
1.2. Unit Cost Method – Fee is computed by cost per square meter of the project and
is based on accurate and timely data.
1.3. Value-based Pricing/Percentage of Gross Rentals – Fee is based on the revenue
or profitability results of the service or building.
2. Lump-Sum of Fixed Fee – Fee is an estimation of the Direct Cost with a margin of profit.
3. Time Basis Fee
3.1. Multiple of Direct Personnel Expense (MDPE) – Non-creative work; Fee is based
on the technical hours spent for the works.
Formula:
 (Architect’s Rate x No. of Hours Spent) + (Consultant’s Rate x No. of Hours
Spent) + (Technical Staff’s Rate x No. of Hours Spent) = DIRECT COST
 Direct Cost x Multiplier (Range: 1.5 to 2.5) = FEE
 Fee + Reimbursable Expenses = TOTAL COST OF SERVICES
3.2. Professional Fee + Expenses (PFPE) – Continuing relationship on a series of
projects.
3.3. Per Diem, Honorarium + Expenses – Work that requires the Architect’s personal
time (i.e. meetings, trainings, seminars, oculars, consultations, etc.).
3.4. Salary Cost x Multiplier – For projects with costs & time constraints that are
difficult to determine at the onset of the project.
Formula:
 [Salary Cost x Multiplier (Factor of 3.0)] = FEE
3.5. Per Diem or Hourly – For projects requiring intermittent personal service or
occurring in irregular periods of time; includes travel time.
3.6. Retainer – For when the Architect’s services is to be required at intervals. An
amount is paid at regular intervals.
4. Mixed Methods of Compensation – a combination of two or more methods of
compensation.
III. SCHEDULE OF FEES
1. Pre-Design Services (SPP Doc 201)
a. MDPE
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METHODS OF COMPENSATION
COMPREHENSIVE LECTURE
Ar. Jomarie Viel Maglunob
2.
3.
4.
5.
6.
b. PFPE
c. Lump Sum
d. Per Diem
e. Mixed
Regular Design Services (SPP Doc 202)
a. Percent of PCC
(For Recommended Professional Fees (RPF) & Schedule of Fees per building type,
see Annex A)
b. Unit Cost Method based on PCC
c. PFPE
d. Lump Sum
e. Per Diem, Honorarium + Reimbursable Expenses
f. MDPE
g. Mixed
Specialized Architectural Services (SPP Doc 203)
a. Percent of PCC (Cost of Work)
(For RPFs & Schedule of Fees per Service, see Annex B)
b. Unit Cost Method based on PCC (Cost of Work)
c. MDPE
d. PFPE
e. Lump Sum
f. Retainer
g. Per Diem, Honorarium
h. Mixed
Full-Time Supervision (SPP Doc 204-A)
a. Percent of PCC – RPF = 1% to 1.5% of PCC
b. MDPE
c. PFPE
d. Lump Sum
e. Per Diem, Honorarium
Construction Management (SPP Doc 204-B)
a. Percent of PCC – RPF = 1.5% to 3% of the PCC
b. MDPE
c. PFPE
d. Lump Sum
e. Per Diem, Honorarium
f. Mixed
Post-Construction Services (SPP Doc 205)
a. Value- Based Pricing or Percentage of Gross Rentals, Maintenance Fees, &
Security Fees – RPF = 4% to 6% of Gross Rentals (Incentive-Based)
b. Monthly Salary
c. MDPE
d. Retainer + Reimbursable Expenses
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METHODS OF COMPENSATION
COMPREHENSIVE LECTURE
Ar. Jomarie Viel Maglunob
e. PFPE + Reimbursable Expenses
7. Comprehensive Architectural Services (SPP Doc 206)
a. Percent of PCC – RPF = 2% to 5% of PCC
b. MDPE
c. PFPE
d. Lump Sum
8. Design-Build Services (SPP Doc 207) – Design-Build Services by Administration / DesignBuild Services on a Guaranteed Maximum Cost
a. Percent of PCC – RPF = 7% of PCC (Design-Build Services by Administration)
b. MDPE
c. PFPE
d. Lump Sum
e. Per Diem, Honorarium + Reimbursable Expenses
f. Mixed
g. Built into the Guaranteed Maximum Cost (Design-Build Services on a Guaranteed
Maximum Cost) – RPF = 10% of PCC
9. Architectural Design Competition (SPP Doc 208)
a. Salary for the Secretariat
b. Office Overhead Costs
c. Honorarium for the Professional Advisor
d. Honorarium for the Technical Advisor
e. Honorarium for the Jurors
f. Prizes and/or Honoraria for the Winners and/or Participants (See SPP Doc 208)
10. Professional Architectural Consulting Services (SSP Doc 209)
a. Per Diem or Hourly Basis
b. Retainer
c. Salary Cost x Multiplier + Reimbursable Expenses
d. Lump Sum
e. Percent of PCC (Cost of Work)
IV. GENERAL PROVISIONS
1. COLLECTION OF PROFESSIONAL FEES – It is unlawful for any unlicensed and/or
unregistered person to collect a fee for architectural services.
2. INTEREST DUE TO LATE PAYMENTS – The Architect is entitled to interest at the
prevailing rate set by the Bangko Sentral ng Pilipinas (BSP) and mutually agreed upon
by the Architect and the Client, on all fees, other charges and reimbursements due and
not paid within 30 days from receipt of billing.
3. GOVERNMENT TAXES – The Architect’s Fee is a net amount. Apart from income taxes
payable by the Architect, all other taxes (e.g. VAT) that the national government and
local government may impose on the Architect brought about by the services
performed for the project shall be paid for by the Client.
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METHODS OF COMPENSATION
COMPREHENSIVE LECTURE
Ar. Jomarie Viel Maglunob
4.
5.
6.
7.
ARBITRATION – In case of any dispute between the Architect and the Client, the
dispute shall be dealt with in accordance with RA 9285 (Alternative Dispute Resolution
Act of 2004).
PENALTY CLAUSE & SANCTION – Any individual, partner. firm/corporation/consortium
who engages in architectural services, but are not qualified in accordance with the
provisions by laws, particularly under R.A. No. 9266 (The Architecture Act of 2004) and
its IRR shall be subject to sanction/s by the appropriate public or private entities,
without prejudice to the filing of appropriate criminal, civil or other administrative or
cases pursuant to existing laws.
AMENDMENTS – The UAP-IAPOA shall continuously enhance the contents of this
document to be responsive to new challenges and requirements of professional
practice. Any amendment to this document shall prepared by a Special Committee on
the Standards of Professional Practice of the IAPOA. The amendments shall then be
submitted to the UAP National Board for approval.
EFFECTIVITY – This document shall be effective after approval of the UAP National
Board of Directors and upon recommendation of the PRC and PRBoA for
implementation as part of the PRBoA-issued Resolution on the Standards of
Professional Practice (SPP) Documents. This happened on October 15, 2014.
- END OF MAIN MODULE –
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METHODS OF COMPENSATION
COMPREHENSIVE LECTURE
Ar. Jomarie Viel Maglunob
ANNEX A
REGULAR DESIGN SERVICES
Recommended Professional Fees & Schedule of Fees
TABLE A.1. Building Type Groupings.
Buildings of SIMPLE utilization & character, without complication of
GROUP I
design.
GROUP II
Buildings of MODERATE complexity
GROUP III
Buildings of EXCEPTIONAL character & complexity
GROUP IV
RESIDENCES
GROUP V
MONUMENTAL buildings
GROUP VI
REPETITIVE Construction (Except Housing)
GROUP VII
HOUSING PROJECTS
GROUP VIII
Projects involving EXTENSIVE detail
Alterations, Renovations, Rehabilitations, Retrofit, &
GROUP IX
Expansion/Addition
GROUP X
Rendering of PROFESSIONAL OPINION
TABLE A.2. RPF for Group I (DAEDS).
Project Construction Cost (PCC) in PHP
50M and less
50M – 100M
100M – 200M
200M – 500M
500M – 1B
Over 1B
Recommended Professional Fee
5%
2.5M + 4% of excess of 50M
4.5M + 3% of excess of 100M
7.5M + 2% of excess of 200M
13.5M + 1% of excess of 500M
18.5M + ½ % of excess of 1B
TABLE A.3. RPF for Group I (DADS).
Project Construction Cost (PCC) in PHP
50M and less
50M – 100M
100M – 200M
200M – 500M
500M – 1B
Over 1B
Recommended Professional Fee
3%
1.5M + 2.4% of excess of 50M
2.7M + 1.8% of excess of 100M
4.5M + 1.2% of excess of 200M
8.1M + 0.6% of excess of 500M
11.1M + 0.6% of excess of 1B
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METHODS OF COMPENSATION
COMPREHENSIVE LECTURE
Ar. Jomarie Viel Maglunob
TABLE A.4. RPF for Group II (DAEDS).
Project Construction Cost (PCC) in PHP
50M and less
50M – 100M
100M – 200M
200M – 500M
500M – 1B
Over 1B
Recommended Professional Fee
6%
3M + 5% of excess of 50M
5.5M + 4% of excess of 100M
9.5M + 3% of excess of 200M
18.5M + 2% of excess of 500M
28.5M + 1% of excess of 1B
TABLE A.5. RPF for Group II (DADS).
Project Construction Cost (PCC) in PHP
50M and less
50M – 100M
100M – 200M
200M – 500M
500M – 1B
Over 1B
Recommended Professional Fee
3.6%
1.8M + 3% of excess of 50M
3.3M + 2.4% of excess of 100M
5.7M + 1.8% of excess of 200M
11.1M + 1.2% of excess of 500M
17.1M + 0.6% of excess of 1B
TABLE A.6. RPF for Group III (DAEDS).
Project Construction Cost (PCC) in PHP
50M and less
50M – 100M
100M – 200M
200M – 500M
500M – 1B
Over 1B
Recommended Professional Fee
7%
3.5M + 6% of excess of 50M
6.5M + 5% of excess of 100M
11.5M + 4% of excess of 200M
23.5M + 3% of excess of 500M
38.5M + 2% of excess of 1B
TABLE A.7. RPF for Group III (DADS).
Project Construction Cost (PCC) in PHP
50M and less
50M – 100M
100M – 200M
200M – 500M
500M – 1B
Over 1B
Recommended Professional Fee
4.2%
2.1M + 3.6% of excess of 50M
3.9M + 3% of excess of 100M
6.9M + 2.4% of excess of 200M
14.1M + 1.8% of excess of 500M
23.1M + 1.2% of excess of 1B
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METHODS OF COMPENSATION
COMPREHENSIVE LECTURE
Ar. Jomarie Viel Maglunob
TABLE A.8. RPF for Group IV.
Service
DAEDS
DADS
Recommended Professional Fee
10% of PCC
6% of PCC
TABLE A.9. RPF for Group V.
Service
DAEDS
DADS
Recommended Professional Fee
12% of PCC
7.5% of PCC
TABLE A.10. RPF for Group VI.
Service
First (1st) Building
Second (2nd) Building
Third (3rd) Building
th
Fourth (4 ) and Succeeding Buildings
TABLE A.11. RPF for Group VII.
Number of Units
1
2 – 10
11 – 30
31 – 50
51 and above
Recommended Professional Fee (RPF)
100% of RPF for type of building
50% of RPF for type of building
40% RPF for type of building
30% RPF for type of building
Recommended Professional Fee (RPF)
DAEDS
DADS
10% of PCC
6% of PCC
Fee for one unit + 50% for
Fee for one unit + 30% for
each additional unit
each additional unit
Fee for ten units + 40% for
Fee for ten units + 24% for
each additional unit
each additional unit
Fee for 30 units + 25% for
Fee for 30 units + 15% for
each additional unit
each additional unit
Fee for 50 units + 15% for
Fee for 50 units + 9% for each
each additional unit
additional unit
TABLE A.12. RPF for Group IX.
RPF
TABLE A.13. RPF for Group X.
Service Rendered
Technical Opinion/Advice
Expert Witness
150% of PCC (Cost of Works Covered)
RPF
PHP 1,000 / hour (Minimum)
PHP 5,000 / appearance
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METHODS OF COMPENSATION
COMPREHENSIVE LECTURE
Ar. Jomarie Viel Maglunob
TABLE A.14. Schedule of Payments.
Work Phase
Upon signing of the Service
Agreement
Upon completion of the Schematic
Design Phase
Upon completion of the Design
Development Phase
Upon completion of the Contract
Document Phase
Bidding or Negotiation Phase
Upon Completion of Work
Payment Due
5% of PF
Cumulative
Amount
5%1
+ 15% of PF
20%2
+ 20% of PF
40%2
+ 50% of PF
90%2
(Adjust fee to be equal to 90%, as
per winning bid)
+ 10% of PF
(5% for civil liability, 5% for
Periodic Construction Supervision)
90%3
100%4
1. Based on original SPPCC as stipulated in the Service Agreement.
2. Based on latest SPPCC submitted at that particular stage.
3. Based on winning bid.
4. Based on FPPCC.
- END OF ANNEX A –
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METHODS OF COMPENSATION
COMPREHENSIVE LECTURE
Ar. Jomarie Viel Maglunob
ANNEX B
SPECIALIZED ARCHITECTURAL SERVICES
Recommended Professional Fees & Schedule of Fees
TABLE B.1. RPF for Architectural Interiors (AI), Acoustic Design, Lighting Layout & Design, and Site
Development Planning (SDP).
RPF
10% - 15% of Cost of Work
TABLE B.2. Schedule of Payments for Architectural Interiors (AI), Acoustic Design, Lighting Layout
& Design, and Site Development Planning (SDP).
Phase of Works
Payment Due
Upon Submission of Preliminary Design
30% of RPF
Upon Submission of Final Design
50% of RPF
Upon Completion of the Project
50% of RPF
Note: Obviously, this tally does not total to 100%. This will most likely be edited in future iterations of this document.
TABLE B.3. RPF for Physical Planning.
Area
RPF
Basic Rate for the first 5
PHP 5.00 per sq. m.
hectares or less
Over 5 – 10 hectares
PHP 4.00 per sq. m.
Over 10 – 50 hectares
PHP 3.00 per sq. m.
Over 50 hectares
PHP 1.50 per sq. m.
Amount
PHP 250,000.00
PHP 250,000.00 +
PHP 40,000.00 per hectare above 5
hectares and below 10 hectares
PHP 450,000.00 +
PHP 30,000.00 per hectare above
10 hectares and below 50 hectares
PHP 1,650,000.00 + PHP 15,000.00
per hectare above 50 hectares
NOTE: These rates apply to moderately flat sites only. If the site is rugged or with steep terrain, the fee shall increase by 20-30%.
TABLE B.4. Schedule of Payments for Physical Planning
Phase of Works
Framework Development Plan (FrDP)
Conceptual Master Development Plan (CMDP)
Preliminary Master Development Plan (PMDP)
Detailed Master Development Plan (DMDP)
Payment Due
30% of RPF
30% of RPF
20% of RPF
20% of RPF
- END OF ANNEX B -
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