What is a reasonable amount of time for a Contractor to submit a change proposal in a timely and complete manner?

Have you ever heard of the terms “Change Order” and “Change Proposal”? You would definitely have if you are in the construction business. They are rather commonly usedby a contractor or by someone who has a house or office built a number of times. You see, it is quite natural for there to be changes in plan when there is a construction going on and it can be for various reasons.

A change proposal is a proposal that is formally given to bring changes into a project with regard to service, funds or scope of work. It is important that the change proposal clearly specifies everything and is submitted on time with all the necessary details.

For a contractor, it is important to get a document called ‘change order’ signed by the client/owner before going ahead with the changes.

Before looking at the reasonable amount of time for a contractor to submit a change order in a timely and complete manner, you must know what a change order is.

What is a Change Order?

Change order is basically a document that lists the changes in the scope of construction, site condition, design and even the schedule of the project. For it to be valid there is a need for both the contractor and owner to give their consent.

So, what is a change order usually made for? You will find it made for anything the client wants to change about the project or that the contractor finds necessary to complete the project properly like changing the location of the wall, adding another door that was not in the initial plan or moving a particular design elsewhere. Along with new additions, a change order can have deletion of certain structures from the original plan.

Most often change orders are a part of construction projects and therefore it is important that you realize their importance. In short, whenever there is a change in the scope of work mentioned in the contract, the contactor has to make a change order and get it signed by the owner/client. This would make both the parties prepare for the change in pricing involved.

How to Tackle a Change Order?

If you are a contractor, and the project owner requests a change, you can neither ignore the request made nor can you upset your project owner. To set things right and survive in the business, you must work things out in your favour. The solution should be such that there is the right use of time, money and resources.

Now, it is time to look at the time frame of submitting a change proposal by a contractor

Amount of Time for a Contractor to Submit a Change Order

Usually, the change in the scope of work should be informed within a specified time frame.

The time period of notification does vary from one contract to another, but it is important that you stick to the time line. Make a note of the date when the notice for the change was made and when you submit the change order.

From the contractor’s perspective, the owner has to be notified as soon as possible, immediately to 10 days, depending on the size of the project. In case, there is no information, or the processing is done poorly, there are chances of the change order being rejected by the owner or the payment getting stuck. Therefore, it is important that you have a complete understanding of how and when you should submit a change order, and this should be agreed upon before the start of the project.

Timely submission is not enough. You must be careful about it containing all the necessary information, so everything is made clear.

What should the Change Order Form contain?

Ideally, the change order form should have the following things mentioned on it:

·      The contract no

·      Name of the owner and his contact details

·      Name of the prime contractor and his contact details

·      Name and address of the project

·      Name and contact details of the contractor

·      Change order number

As a contractor all of the above should be present in the change order along with the following:

1) A detailed description of the change to be made as opposed the original plan

2) Item-wise cost involved

3) Total cost of the change to be made

4) How the proposed change would affect the project completion schedule

As a contractor, you must give the description of the changes in detail. There may be additional work to be done or certain things that are not needed anymore. The description must be done in a detailed manner because the person who is going to read it may not be that aware of the details of the project.  Estimating software will make this process easier.

It would be better to attach photos, drawings, and descriptions as well so that you can explain the change in a clear manner. Adding as much information as possible will be helpful for you in the future.

The new schedule

It is obvious that when there is a change in construction, there will be a change in the schedule as well. What you have promised the project owner is not applicable anymore. As a contractor, you must clearly mention the number of days you would need to complete the proposed project. Your date of completion should also be specified.

The cost involved in the change 

You need to specify the cost of the change in the project. There can be extra charges or even reduction in cost sometimes. It is essential to have all the details mentioned in the change order including the labour and material cost involved. You have to state how much the project would cost you after the changes. Cost estimating software will assist greatly in giving you the costs for the change and the proper presentation of the document.

The Final Word

Being a contractor, getting the consent of the client or owner for the changes to be made is especially important. A change order should therefore be submitted so that there are no issues later and your payment does not get stuck. It is important to send a well-documented change order as soon as possible from the day of notification.