# extra work questions for the pros



## A.W.Davis (Oct 17, 2006)

I have got a large job going on right now and the HO is wanting lots of extra work outside of the contract, I agree while the walls and cielings are open to do these things. I am familiar with writing the extra work down on an extra work order sheet for the homeowners, normally my jobs in the past were small enough so I could just bill them the extra work with the final payment and it was no big deal.

Now the problem here is and my question is.....do I have to wait until the end of the job at final to collect for the extra work that has been completed, or can I bill them as soon as the extra work has been completed. I just dont want $5,000 in retentions if I dont have to have it.

Thanks -Anthony


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## A.W.Davis (Oct 17, 2006)

tough crowd tonight


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## catalfanoc (Feb 11, 2005)

make a change order sheet figure out a price or atleast a good idea and make them sign it


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## copusbuilder (Nov 8, 2005)

You should have dropped the pro part. That way more of us would answer:laughing: 

I don't see why you can't bill for the extras when they are completed. I often do along wih a regular draw:thumbsup:


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## Blackbird (Feb 6, 2007)

Make a change order stating the price and have them sign it. Make sure they know that you have a higher markup on changes,tell them about the extra work for the subs to change thier contracts and schedules and the extra work for you to do the same. Bill them for it in the next draw (after the work is done).


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## Mike Finley (Apr 28, 2004)

A.W. you can do it however you want. It's perfectly common, legal and ethical to define the terms on the change order of how payment is to be made. Ours is pretty simple, it says payment due as extra work is completed.

Also if your schedule with them can become extended and you think it might be a problem down the road, add another statement that change orders will automatically negate the agreed upon completion date and a new completion date must be determined.


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## A.W.Davis (Oct 17, 2006)

Will do, thanks for the input guys.....time to write up the extra work order spreadsheet.....chaaaa chiiing :thumbsup: 

Lat question......have you guys ever had a HO want an itemized list of material and labor charges??


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## Mike Finley (Apr 28, 2004)

I've met a homeowner that wanted that, but I've never had a customer, because those homeowners never become customers if that is what they insist on.


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## Danahy (Oct 17, 2006)

Here's a cut and paste from my estimate/terms.

Additional Work Requests:
Should you require any additional work to be done while we are present, the cost for labour and materials for the additional work must be quoted seperate from the original proposal. If our schedule permits, the additional work may be added to the original paint proposal pending approval between Danahy Design, and you the customer. Otherwise a new date will have to be arranged for completion of the additional work at our next earliest convenience.


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## Eric K (Nov 24, 2005)

When you guys encounter some unexpecteds on the job that require more than the contract stated do you...

A: Do the work then write the change order and T&M it.
B: Write the change order and wait for the HO to sign off on it.


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## A.W.Davis (Oct 17, 2006)

Eric K said:


> When you guys encounter some unexpecteds on the job that require more than the contract stated do you...
> 
> A: Do the work then write the change order and T&M it.
> B: Write the change order and wait for the HO to sign off on it.


I choose "B" 

I wouldnt want to do any work without the HO's consent and signature of the extra work to be completed.


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## A.W.Davis (Oct 17, 2006)

Danahy said:


> Here's a cut and paste from my estimate/terms.
> 
> Additional Work Requests:
> Should you require any additional work to be done while we are present, the cost for labour and materials for the additional work must be quoted seperate from the original proposal. If our schedule permits, the additional work may be added to the original paint proposal pending approval between Danahy Design, and you the customer. Otherwise a new date will have to be arranged for completion of the additional work at our next earliest convenience.


 
Thanks Danahy


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## Ed the Roofer (Dec 12, 2006)

If you do the work first, before getting something in writing agreeing to the scope and the cost, you are just asking for problems down the road.

Even the items I repeatedly encounter in my trade, which I have prices listed for in the initial contract, I make sure that it gets signed for. 

Also, if you encounter a hard -azz custimer that does not want to sign for extra work that becomes required to complete your original scope of contracted work, you should add a clause in your original contract boilerplate language that deals with this scenario. Additionally, you should add a phrase which indicates, that by the customer allowing the work to proceed after they have been notified in writing, irregardless if they have signed the change order or not, that they have implied consent to the changes and to the additional costs incurred.

Ed


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## J F (Dec 3, 2005)

Here's part of our contract (feel free to use any of it)

E. CHANGE ORDERS, CONCEALED CONDITIONS, ADDITIONAL WORK, AND
CHANGES IN THE WORK 


1. PEOPLE AUTHORIZED TO SIGN CHANGE ORDERS: The following people are authorized to sign Change Orders:

xxxxxxxxxxxx__________ (please initial)

xxxxxxxxxxxx__________ (please initial)

2. CONCEALED CONDITIONS: This Agreement is based solely on the observations Contractor was able to make with the structure in its current condition at the time this Agreement was bid. If additional Concealed Conditions are discovered once work has commenced which were not visible at the time this proposal was bid, Contractor will stop work and point out these unforeseen Concealed Conditions to Owner so that Owner and Contractor can execute a Change Order for any Additional Work.

3. CHANGES IN THE WORK: During the course of the project, Owner may order changes in the work (both additions and deletions). The cost of these changes will be determined by the Contractor and the cost of this Additional Work will be added to Contractor's profit and overhead in order to arrive at the net amount of any additional Change Order work. In addition, there will be an administrative fee of $200.00 added for each change order.

Contractor's profit and overhead, and supervisory labor will not be credited back to Owner with any deductive Change Orders (work deleted from Agreement by Owner).

4. DEVIATION FROM SCOPE OF WORK IN CONTRACT DOCUMENTS: Any alteration or deviation from the Scope of Work referred to in the Contract Documents involving extra costs of materials or labor (including any overage on ALLOWANCE work) will be executed upon a written Change Order issued by Contractor and should be signed by Contractor and Owner prior to the commencement of any Additional Work. This Change Order will become an extra charge over and above the Lump Sum Contract Price referred to at the beginning of this Agreement and will be paid for at time of signing.

5. CHANGES REQUIRED BY PLAN CHECKERS OR FIELD INSPECTORS: Any increase in the Scope of Work set forth in the Contract Documents which is required by plan checkers or field inspectors with city or county building/planning departments will be treated as Additional Work to this Agreement for which the Contractor will issue a Change Order.

Now for the IMPORTANT part:

PAYMENT OF CHANGE ORDERS: Payment for each Change Order is due upon signing of Change Order and prior to the start of any Change Order work.:thumbsup: 

Using the above we have found that we never have any client that is surprised at the end of the job....or trying to argue about money after the work has been done...that's not a situation you want to find yourself in.

J


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## J F (Dec 3, 2005)

Here's a PDF file of one of our change orders to take a look at.

J


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## A.W.Davis (Oct 17, 2006)

Thanks for the very helpful info JF! :thumbsup:


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## North Country (Jan 14, 2006)

Our policy on change orders is that the total amount of the change is due BEFORE the change proceeds and requires approval of both the homeowner and the contractor. At contractors discretion, change may be paid upon the next scheduled draw. There is an estimating fee of 65.00/hr whether or not the change is elected. The reason you need to get paid for these changes before, is that after the work is completed, you have no legal recourse in terms of the original contract.


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## J F (Dec 3, 2005)

No problem Anthony

J


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## ACTRenovator (Jan 1, 2007)

have them sign and date and agree to your "Change Order form" (we call it a "Variation"). Then usually we charge them this amount at the next progress claim when due. We have usually five progress claims during the course of the job and either one of these we can bill them the Variations to date. A simple process.


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## Tom M (Jan 3, 2007)

I like the idea of having some kind of change order form pre made on the truck. Some of these decisions need to be made ASAP while working so your left with the situation of go home earn nothing and loose time or get verbal agreement via phone which anyone can be reached anywhere these days. Whernever I do this with out paper people have a problem--- not with agreeing--- but remembering and it seems the value of your time becomes an issue. Labor is always the most expensive. I myself should start leaving an edited change order with the customer to sign at night and leave for you upon your return.


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## J F (Dec 3, 2005)

I would agree to have some form of change order with you...especially if you are doing any (or all) of the work personally....just write it up and have the client sign it (and maybe get payment...)

J


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## ultimatetouch (May 27, 2006)

Mike Finley said:


> I've met a homeowner that wanted that, but I've never had a customer, because those homeowners never become customers if that is what they insist on.


I totally agree with Mike here. If you got someone wanting itemized details they are only going to shop U till they drop and they are most likely time waisters. Itemized lists of work and labor and materials are for sumcontractors to give to the GC. Not for homeowner to contractor.
A lot of people try to pull that crap I never even get back to them those jobs would probably not have the profit that we are looking for. I have had people say well the job will be granted to someone by wednesday so go ahead give your price. I dont bid jobs that a bunch of crap. I choose to sell to the educated consumer and they realize the best dont come the cheapest or we all would have Ikea furniture in our homes.


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## ultimatetouch (May 27, 2006)

i just think its ridiculous that any guys would give in to itemising there labor in a contract. Its such a slap in the face. Do you go to the store do you guys ask them to see what there prices are so you could see if it is a fear price. Thats crazy. List the scope of work in detail thats all.
Its like negotiating with yourself.


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## Mike Finley (Apr 28, 2004)

Eric K said:


> When you guys encounter some unexpecteds on the job that require more than the contract stated do you...
> 
> A: Do the work then write the change order and T&M it.
> B: Write the change order and wait for the HO to sign off on it.


There's an ideal situation and then there is not. In a perfect world we always right up the change order and have the customer sign it and then we tack the new costs onto the next progressive payment. 

However, there are situations were compromising our schedule will be more harmful then losing a few hundred dollars on a change order if the customer goes squirly. We do tell the customer before jobs start that part of their responsibility in all this is to be available for consultations for hidden defects. We want every contact number they have and stress to them we need to be able to talk to them within no longer than an hour. For the majority of jobs we have minor change orders, one of the customers is at home, or available and we are able to not allow a defect to be a job stopper. But every once in a while you hit the exception and then it's a judgment call. You've got an issue and you've got to get something buttoned up by the end of the day for an inspection in the morning, you either do it, and roll the dice the customer will cover it or you blow your schedule by 24 hours.

Taking pics of the issue can help in these situations. But you pretty much are at the customers mercy if they squak without having signed anything. Hidden defect change orders can be the tricky ones.


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## tcleve4911 (Mar 26, 2006)

Remodeling is riddled with change orders. We have 3 steps that make CO's managable. 
1.) *Request for change order*- This is a sheet located at the onsite communication center. HO asks about a change, we write a brief description on the list. Many days they are multiple requests.
2.*) Change order #1,#2,#3,#4*,... etc is generated and put with the onsite communication center with a note " for your approval" Customer signs & dates the CO. 
3.) *Invoice* for CO #3. Payment is due upon receipt of CO
Keeping CO's formal keeps accounting current. SO SO important!!!


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## wellbuilthome (Feb 5, 2008)

I like to write out a work order change and get payed on the spot . Never have a problem .


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## Edward (Sep 1, 2005)

*Hay J F*

Can we get a look at the rest of your contract?

The Change order looks interesting!

:thumbsup:

Ed


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## glkirk (Nov 27, 2011)

catalfanoc said:


> make a change order sheet figure out a price or atleast a good idea and make them sign it


And have them pay for it in advance!


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