What is a change order?

A change order is a formal document that modifies a previous agreement, often related to services, such as a construction contract. It outlines adjustments to the project's scope, cost, or timeline that differ from the initial agreement. Change orders are typically used when unforeseen circumstances arise or when clients request modifications to the original plan. They serve as an official record of the agreed-upon changes and become part of the legally binding contract. A properly executed change order is crucial for maintaining clear communication and avoiding disputes between all parties involved in the project.

Who can initiate a change order?

Change orders can be initiated by various parties involved in a construction project. The project owner or client may request changes to the original plan, such as adding features or modifying designs. Contractors or subcontractors might initiate change orders if they encounter unexpected site conditions or identify more efficient methods. Architects or engineers may also propose changes based on design improvements or regulatory requirements. Regardless of who initiates the change order, it must be reviewed and approved by all relevant parties before implementation.

What should be included in a change order?

A comprehensive change order should include several key elements. First, it should clearly describe the proposed changes. The document should outline the impact on the project's scope, cost, and timeline, including any adjustments to materials, labor, or equipment. It should also specify any modifications to the contract price and completion date. Additionally, the change order should include spaces for signatures from all relevant parties, such as the owner, contractor, and architect, to indicate approval and agreement to the proposed changes.

Can a change order be rejected, and what happens then?

Yes, a change order can be rejected by any of the involved parties. If a change order is rejected, it is important to document the reasons for the rejection and communicate them clearly to all stakeholders. In such cases, the project typically continues according to the original contract terms. However, if the rejected change order addressed a critical issue, the parties may need to negotiate an alternative solution or compromise. In some instances, unresolved disagreements over change orders can lead to disputes or even legal action, highlighting the importance of clear communication and documentation throughout the change order process.

Change Order

A change order is a formal document used to request and authorize modifications to the scope, specifications, or requirements of a project that is already underway.

It ensures that all parties involved agree on the changes, including any adjustments to the project's timeline, budget, and resources.

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Change Order

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Why use a change order?

Provides formal documentation of project changes and agreements
Clarifies scope modifications to prevent misunderstandings and disputes
Allows for proper budgeting and resource allocation adjustments
Maintains transparency and accountability between all project stakeholders

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Identify the Necessary Change

The first step in drafting a change order is to clearly identify the need for the change and document it comprehensively. This includes detailing the modifications required, the reasons behind the change, and the impact on the project's scope, timeline, and budget. It is crucial to gather all necessary information and supporting documentation, such as drawings, photos, and written descriptions, to justify the change and ensure all stakeholders understand the proposed modification.

Draft the Change Order

Once the change is identified and documented, the next step is to draft the change order itself. This involves creating a formal document that includes key elements such as project and contact information, detailed descriptions of the change, the cost impact, and the revised project schedule. The change order should also outline any adjustments to the contract value and include sections for approval signatures from all relevant parties. Use our change order template to ensure the document is thorough and requires all necessary elements.

Submit for Approval and Implement Changes

After drafting the change order, it must be submitted for approval to the appropriate stakeholders, such as the project owner, contractor, and any other relevant parties. Once all necessary approvals are obtained, the change order becomes a binding part of the contract, and the project team can proceed with implementing the changes as outlined in the document.

Submit, Review, and Sign

After drafting the change order, it must be submitted for approval to the appropriate stakeholders, such as the project owner, contractor, and any other relevant parties. Thoroughly review the agreement to ensure that all essential clauses and language have been accurately included. After downloading the document in the appropriate format, you to can make additional edits to refine the details or address any omissions. Once the change order becomes binding, the project team can proceed with implementing the changes as outlined in the document.

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