What is Change Orders?
Updated: 9 March 2026
A change order is a formal instruction to modify the scope, schedule, or price of a contract relative to what was originally agreed. Additional work (extra scope beyond the original specification) is compensated at an agreed rate; reduced work results in a downward price adjustment. In construction contracts, change orders follow a prescribed process under the applicable standard conditions; in IT and services contracts, the equivalent procedure is called change management or change control. Change orders without written authorisation frequently lead to payment disputes.
How does change orders work?
Change orders arise whenever the actual execution of a project deviates from the originally specified scope. Additional work means tasks performed beyond the original specification, compensated separately. Reduced work means a portion of the original scope is omitted, reducing the contract price.
In Dutch construction, change orders (meer- en minderwerk) are governed by the UAV 2012. Articles 35–38 describe how additional work must be notified, how the price is calculated (unit rates, actual cost, or fixed markup), and the deadlines for submitting change order statements.
A frequent source of dispute: the contractor performs additional work without obtaining prior written approval from the client, then claims payment as a change order. The client disputes that any instruction was given. Verbal agreement is extremely difficult to prove in a change order dispute.
In IT and professional services contracts, the equivalent process is change management or change control. Every change in scope, timeline, or budget requires a written change request, approved by both parties before the additional work begins. Without this, there is no enforceable right to additional payment.
Reduced scope (minderwerk) has a mirror dynamic: if the client withdraws part of the scope, the contractor is generally entitled to reimbursement of costs already incurred and compensation for lost profit on the omitted work, even though the work was never done.
Why does this matter for SMBs?
Undefined or poorly managed change orders are one of the most common causes of construction and project disputes. Unclear scope at the outset, verbal approvals, and missing written records lead to large claims at project close.
A solid contractual change order procedure, agreed unit rates or day rates for common variations, a clear approval process, and a written-only rule, saves significant time, money and relationship capital when the inevitable scope changes arise.
How to manage this correctly
- 1Specify in the contract that change orders are only payable if instructed in writing before the work is carried out
- 2Define the pricing method for additional work: fixed rates, unit prices, or actual cost reimbursement
- 3Use a change request form for every scope change, even small ones
- 4Agree a threshold below which minor variations are settled without a formal change request
- 5Review the full change order statement before releasing the final payment at project completion
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