What is a change order in construction?
A change order is a written amendment, signed by the owner and contractor, that changes the scope of work, the contract sum, the contract time, or all three after the contract is signed. It becomes part of the contract documents, usually gets its own schedule of values line, and on AIA projects uses form G701.
A change order is how a construction contract gets changed without rewriting it. Every job changes: owners add scope, designers fix errors, crews hit conditions nobody saw. The change order captures exactly what changed, what it costs, and how many days it adds, and both sides sign it. On AIA projects the standard form is G701-2017, Change Order, with a subcontractor variation (G701S).
Once signed, the change order becomes part of the contract documents. It adjusts the contract sum and usually gets its own line on the schedule of values so it can be billed. The original contract line items stay as they were, which keeps the history of the job readable.
How a change order works on a real job
Say a homeowner on a $185,000 kitchen and bath remodel decides mid-job to move the island sink 4 feet. That means new drain and vent routing, a cut in the slab, and a revised countertop template. The remodeler prices it.
| Item | Amount |
|---|---|
| Plumbing labor and material | $2,850 |
| Concrete saw cut and patch | $1,100 |
| Countertop template revision | $450 |
| Subtotal | $4,400 |
| Overhead and profit (15 percent) | $660 |
| Change order total | $5,060 |
| Schedule impact | 3 working days |
The homeowner signs before the slab is cut. The contract goes from $185,000 to $190,060, and the finish date moves three working days. On the next draw, the $5,060 shows on its own line so the homeowner and lender can see it.
Where change orders go wrong
- Doing the work first and pricing later. Once the work is done, the contractor has lost most of the leverage.
- Leaving out time. A change order that adds cost but says nothing about days can waive a later delay request.
- Vague scope. "Move sink" invites an argument about whether the countertop was included.
- Not flowing changes down. If the owner approves a change, the subcontractor's subcontract needs its own matching change order.
- Signature by the wrong person. A superintendent on the owner side may not have authority to approve cost.
Change order, change order request, and change directive
- A change order request is the contractor's proposal. Nothing is agreed yet.
- A change directive orders the work before price is agreed.
- A change order is the signed agreement on scope, price, and time.
- A deductive change order reduces scope and price.
Related terms
See scope creep, allowance, and field order. Start from the construction change order template, or read how to write a construction change order. Smart Business Automator routes change orders for approval and adds them to the job budget and the next invoice once signed.
Frequently asked questions
What's the difference between an RFI and a change order?
An RFI requests clarification. A change order documents an agreed change to contractual work, price or time. An RFI response may identify a needed change, but does not automatically authorize extra payment.
Do contractors charge for change orders?
Additional work may increase the price, while deleted work can produce a credit. A change can also leave price unchanged. The amount and permitted markup depend on the agreement and documented scope.
Can you give me an example of a change order in construction?
Illustration: an owner requests an added doorway after signing the contract. The parties document the revised work, agree its price and schedule effect, and obtain the approvals required by their contract.
Who prepares a change order?
Responsibility depends on the contract. A contractor often assembles scope and pricing information; an architect or contract administrator may prepare the formal instrument. Required parties then review and approve it.
How much does a change order cost?
There is no universal price. Build the amount from the changed quantities, labor, materials, equipment, subcontract work and permitted additions or credits. Record any schedule adjustment separately so neither effect is overlooked.
What are three common reasons for change orders in construction projects?
Common triggers include owner-requested scope changes, design revisions and unexpected site conditions. A trigger does not establish entitlement by itself; document the facts and follow the contract’s notice and change procedures.
When to use a change order in construction?
Use the contractual change process when proposed work alters agreed scope, price or time. Distinguish an agreed change order from a directive or disputed change, and keep the supporting records together.
