27 Oct How Construction Contract Changes Can Affect Project Costs and Delivery
Construction projects rarely follow the original plan exactly. A client may change the design, site conditions may call for different work, or a team may need to adjust the specification. These changes can be manageable, but without clear control they can increase costs, disrupt the programme and put completion dates at risk.
For construction firms and civil engineering companies, the key is to assess each proposed change before work begins. That means considering not only the price of the extra work, but also its impact on labour, materials, subcontractors and the wider project schedule.
What counts as a construction contract change?
A contract change, often called a variation, is an alteration to the agreed scope of work, design or specification. It may add, remove or revise work. The exact process for requesting, approving and pricing a change depends on the contract conditions and any standard forms the parties have agreed to use, such as those published by the Joint Contracts Tribunal (JCT) or the New Engineering Contract (NEC). (rics.org)
The contract form may also reflect the project’s procurement route, such as Design and Build or Construction Management. Common pricing arrangements include Fixed-Price Contracts, Time and Materials Contracts, Cost-Plus Contracts and Unit Price Contracts, each of which can affect how a change is assessed.
A change does not always affect the project’s cost or completion date. But even a seemingly small revision can have knock-on effects if it affects work that has already started or relies on other trades. (rics.org)
How contract changes can increase project costs
The first cost to consider is the work itself. A revised specification may require different materials, additional plant, specialist subcontractors or more labour hours. If existing work must be removed or repeated, rework can add further expense.
There may also be indirect costs. For example, a change that extends the time needed on site may increase time-related preliminaries, such as site management and supervision. Consultant fees for assessing or implementing a change may also apply, depending on the project arrangements. (gov.scot)
Other costs can arise when a change disrupts planned activities. Teams may need to resequence tasks, bring in specialist workers at short notice or manage periods when labour and equipment are waiting for information or access. The actual cost implications depend on the contract, including agreed payment terms, and the circumstances, so they should be assessed and recorded rather than assumed. The main contractor should also check how the change affects any Subcontractor contracts.
How changes affect project delivery
A change can delay delivery when it holds up design approval, purchasing or work on site. If one task moves, follow-on activities may have to move as well. This can affect subcontractor availability and make it harder to keep the project programme on track.
Late decisions can make the impact worse. A revised design may require new materials or technical details before work can continue. If those decisions arrive after the relevant trades have been scheduled, the project team may need to reorganise labour and site activities. RICS guidance highlights the importance of assessing delay and extension-of-time issues in line with the contract. (rics.org)
Workforce planning matters, too. A change may call for a different mix of skills, such as electrical, HVAC, civil engineering or site management experience. If the required people are not available when the work is ready, the change can affect both productivity and programme delivery.
Common causes of cost and schedule pressure
Several issues can make contract changes harder to manage:
- Unclear instructions: Teams may act on different understandings of the revised work.
- Late approvals: Design, procurement and site work may stall while decisions are pending.
- Incomplete cost assessments: A price may cover the visible work but overlook labour, plant, preliminaries or disruption.
- Poor programme coordination: Changes may affect linked activities without the schedule being updated.
- Limited workforce availability: Specialist workers may be difficult to secure at short notice.
A change-control process helps project teams identify and assess these impacts early. Scottish Government construction guidance recommends recording proposed changes, assessing cost and programme effects, and keeping an updated project baseline. (gov.scot)
A practical process for managing changes
A consistent process gives clients, contractors and project teams a shared record of what has changed and why. It can also help decision-makers compare the likely cost and delivery impact with the value the change is expected to bring.
- Record the request. Describe the proposed change, its reason and the work it affects.
- Check the contract. Confirm who can authorise the change and what notice or documentation is required.
- Assess cost and time. Consider labour, materials, plant, subcontractors, preliminaries and any effect on the programme.
- Review workforce needs. Identify whether the revised work needs additional or specialist skills, and when they will be needed.
- Get the required approval. Make sure the change is authorised through the agreed process before proceeding, except where the contract or project circumstances require a different approach.
- Update project records. Keep the change register, cost forecast and programme aligned with the approved scope.
- Communicate with the team. Ensure site managers, subcontractors and affected trades understand the revised plan.
Good records matter throughout this process. Clear instructions, cost assessments, programme updates and approval records can reduce misunderstandings and support more transparent project administration. They may also help construction contract administrators manage changes and address disputes through the process set out in the contract. (gov.scot)
Keep the right skills available as plans change
Contract changes can alter the number and type of workers a project needs. A revised sequence may require extra site supervision, while a design adjustment could call for specific engineering or skilled-trade expertise. Planning recruitment alongside change control can help firms respond without leaving critical work short-staffed.
YourConstruction Recruitment provides temporary and permanent recruitment support for construction firms, civil engineering companies and skilled trades teams. Its tailored recruitment services can help employers plan for changing project needs and source professionals for roles across site management, engineering and the trades. Find out more at YourConstruction Recruitment.
Plan changes before they become delivery problems
Contract changes are a normal part of construction, but their effects are easier to manage when teams assess them early. A clear process helps firms understand the likely cost, time and workforce implications before committing to revised work.
By keeping instructions, approvals, budgets and programmes aligned, project teams can make informed decisions, reduce avoidable disruption and protect delivery goals. This article provides general information, not legal advice. Check the relevant contract and seek professional advice where needed.