Civil and Precast Construction · Question

How are variations and extra work approved and priced?

Short answer

A variation is any change to the agreed scope, such as added, omitted or altered work. It should be instructed in writing, priced before the work starts using the contract rates or an agreed new rate, and approved by the owner or the engineer named in the contract. Work done on verbal instruction with no agreed price is the usual source of disputes.

In more detail

Changes are normal in construction. A client revises a layout, the designer corrects a drawing, or site conditions turn out different from assumptions. The question is whether the change is controlled or casual.

A sound procedure follows a few steps. The change is described in writing, with drawings if needed. The contractor submits a priced proposal showing the extra or saved quantity, the rate used and any effect on completion time. The engineer or owner checks it, negotiates if necessary and signs approval. Only then does work start, and the approved amount is added to the contract value and tracked in a variation register.

How pricing works depends on the contract form. In item rate contracts, existing rates apply to added quantities of the same items. For new work with no matching rate, the parties agree a fresh rate, often built up from material, labour, equipment and a reasonable overhead and margin. In lump sum contracts, the original price stays fixed except for approved changes, which are priced separately in the same manner.

Watch for these points:

The contract should say who can instruct changes and in what form.
Small items agreed on site should still be logged and signed off.
Time effects deserve discussion at the same moment as cost.
Deductions for omitted work should be priced as seriously as additions.
Emergency changes should be recorded after the fact the same day.

Verbal approvals do not hold up

If the change was never recorded, the owner may find the contractor claims payment months later, and the owner may struggle to show what was agreed.

Keep a running total of approved variations against the original contract value so the lender and management see the true projected cost. Legal advice is wise where claims are large.

Key points

Variations need written instruction, priced proposal and approval before work proceeds.
Rates follow the contract schedule where items match; new items need agreed rates.
Track every variation in a register against the original contract value.
Discuss time impact together with cost.

Who this applies to

Owners who expect design changes after the contract is signed.
Project managers and engineers authorising site instructions.
Finance teams monitoring cost against sanctioned project budgets.

Last reviewed 3 October 2026

This answer is general information, not advice on your particular case. Terms, eligibility, and requirements change, so check the current position with the relevant institution or authority.