Guide
Change orders for subcontractors: how to price, submit and get paid
Extra work only becomes money when it's documented, priced, approved and billed. Here's a process that protects your margin without wrecking your relationship with the GC.
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Where change orders come from
| Source | Example |
|---|---|
| RFI responses | The architect answers a conflict with a reroute or added material. |
| Bulletins, ASIs & drawing revisions | New sheets add fixtures, devices, walls or equipment. |
| Submittal review | A product is rejected and the required replacement costs more. |
| Owner requests | Added rooms, upgraded finishes, extra equipment. |
| Existing conditions | Renovation surprises behind walls, above ceilings or below slabs. |
| Schedule changes | Acceleration, out-of-sequence work or after-hours requirements. |
The five-step process
- 1Give written notice right away. Email the GC the moment you see a change: what it is, what caused it, and that a price will follow. Check your subcontract for the notice deadline.
- 2Document it. Photos, the RFI or bulletin number, field directives and, for T&M work, signed daily tickets.
- 3Price it completely. Labor (hours × rate), material with quotes, equipment, lower-tier subs, your allowed markup, and schedule impact in days. Use the free change order form.
- 4Submit and follow up. Keep a log with dates and status, and follow up weekly on anything pending.
- 5Bill it. Once approved, add it to the contract sum and bill it on your next pay application, usually as its own line.
What to include in the price
- Labor by classification, with hours and rates (including burden, if your contract allows)
- Material with supplier quotes, tax and freight
- Equipment and rentals
- Lower-tier subcontractor quotes
- Markup at the rates your contract allows (often different for your own work and for subs)
- Supervision, project management, permits, bonds or insurance if the change affects them
- Schedule impact, even if it's zero
Mistakes that cost subs money
- Doing the work on a verbal OK and pricing it weeks later.
- Missing the contract's written notice deadline.
- Signing a change order with "zero days" when the change affects your schedule.
- Forgetting to bill approved changes on the next pay app.
- Leaving pending changes until closeout, when you have the least leverage.
This guide is general information, not legal advice. Follow the change process in your subcontract.
Frequently asked questions
What's the difference between a change order request and a change order?
A change order request (also called a COR or potential change order, PCO) is your priced proposal for the extra work. It becomes a change order once both parties sign it and it modifies the contract sum or time.
What is a construction change directive?
A directive orders you to proceed with a change before the price is agreed. Keep detailed cost records (labor hours, material invoices, equipment) so the final price can be settled, and follow the directive process in your contract.
How fast do I have to give notice of a change?
Your subcontract sets the deadline, and it can be short, often a matter of days. Missing a notice deadline can cost you the right to be paid, so send written notice as soon as you identify a change, even before it is priced.
How do I price time-and-material work?
Get the GC's signature on daily T&M tickets that list workers, hours, materials and equipment. Price them at your contract rates and markup, and attach the tickets as backup to the change order.
Spend less time on paperwork and more time building.
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