How to review a change order before you sign
A change order adds cost, time, or both, and once it’s signed it’s hard to undo. Before you approve one, confirm the work is really a change, find out why it happened, and check the price, the markup, and the schedule impact against your contract. Here’s the checklist, in plain language.
First 3 questions free. Upload the change order on Basic (PDF, Word, Excel) or add photos and plan sheets on Plus. Not legal advice.
What to check on every change order.
Work through these in order. If you get stuck on one, that’s the question to ask before you sign.
- Scope
Is it really a change?
Compare the work against the contract documents: the drawings, the specs, the scope of work, and any approved bid clarifications. If the work is already shown or reasonably inferred from the documents, it may already be in the price. Ask the contractor to point to the drawing or spec section the change is based on.
- Cause
Why did it happen?
The cause usually decides who pays. Common causes are an owner request or late decision, a design error or omission, a hidden or differing site condition, and a requirement from the building official. Write the cause on the change order so it’s clear later.
- Price
Is the price broken down?
A single lump number is hard to check. Ask for labor hours and rates, material quantities and unit prices, equipment, and the subcontractor quotes behind it. Compare unit prices to the contractor’s schedule of values or bid where you can, and watch for work that’s priced twice.
- Markup
Does the markup follow the contract?
Most contracts set how overhead, profit, and fee are added to changes, and sometimes cap them. Check the percentages, whether markup is being stacked on markup from lower tiers, and whether general conditions are being added again for work that doesn’t add time.
- Time
What does it do to the schedule?
Ask for the time impact in writing now, as days added or zero. A change order that leaves time “to be determined” can come back later as a delay claim. If the change affects long-lead items or the critical path, ask for the updated schedule.
- Contingency
Where does the money come from?
Check whether the cost comes out of an allowance, the contractor’s contingency, your owner contingency, or new money. On a guaranteed maximum price contract, confirm whether the change raises the maximum price or is covered inside it. Track every change against what’s left.
- Contract terms
Did it follow the contract’s process?
Contracts usually set notice deadlines, who can authorize changes, and how disputed work is handled. Many let the owner direct the work to go ahead while the price is settled (the AIA family of contracts calls this a construction change directive). If notice was late or the process was skipped, ask a construction attorney before you rely on it either way.
- Approval
Approve it in writing, then log it.
Sign only the final, priced version, and make sure the person signing has authority under the contract. Keep a change order log with the number, cause, cost, time, and running total, so you always know where the budget stands.
The cheapest change order is the one you avoid.
Changes come from both sides. On some projects, owners have been responsible for over 50% of the changes. Lock in a clear vision, pick finishes and equipment before construction, confirm the budget, and bring a builder in early so design and price move together.
Read more in why owners drive change costs, see what a guaranteed maximum price does and doesn’t cover, or, for associations, how condo and HOA boards keep change orders under control.
Change order questions owners ask.
What is a change order in construction?
A change order is a written agreement between the owner and the contractor, and often the architect, that changes the contract’s scope, price, or time after the contract is signed. Once it’s signed, it becomes part of the contract.
Do I have to sign a change order?
Not until you agree with the scope, price, and time. If you disagree but need the work to keep moving, many contracts let the owner direct the work while the price is settled. Follow your contract’s process, and talk to a construction attorney if the dispute is significant. This is general information, not legal advice.
Who pays for hidden or unforeseen conditions?
It depends on the contract. Many contracts include a differing site conditions clause that shifts the cost of truly hidden conditions to the owner, often with notice deadlines. Conditions that a reasonable site visit or the provided reports would have shown are a different story. Read the clause and check the notice dates.
What markup is reasonable on a change order?
Start with what your contract says, because many contracts set or cap overhead, profit, and fee on changes. Then check that markups aren’t stacked across tiers and that time-related costs only appear when the change adds time. You can ask Chief Construction Agent to walk through a specific change order with you.
Can Chief Construction Agent review my change order?
Yes, as review support. Basic includes 3 document uploads a day (up to 15 a month: PDF, Word, Excel), and Plus includes unlimited uploads, including photos and plan sheets. You get the bottom line, what to check next, and who should confirm it, in writing. It isn’t legal advice, and your architect, engineer, or attorney has the final say.
Have a change order on your desk?
Then $99/month for Basic or $199/month for Plus. Cancel anytime.
Disclaimer
Chief Construction Agent offers advice based on Florida commercial construction experience and benchmarks. This page is general information, not legal, engineering, or financial advice. Contract terms control, so read your own contract and confirm decisions with your architect, engineer, or construction attorney.
This service is independent and never recommends or steers work to any contractor.