A variation order is a formal written instruction that changes the scope, quality or duration of a construction project after the contract has been entered into. Variations are normally instructed by the client’s representative, such as the architect or contract administrator under JCT, although a change may be proposed by either the client or the contractor. Variation orders are used to accommodate changes to the project’s requirements or specification. Under NEC contracts, the equivalent is an instruction changing the Scope, which is dealt with as a compensation event.
Variation orders are an essential part of the construction process, because they allow the parties to make necessary changes to the project. However, they can also affect the project’s programme, cost and overall performance.
The process for issuing a variation order typically involves the following steps:
- Identifying the proposed change to the project scope, quality or duration.
- Preparing a detailed proposal for the variation, including the estimated cost and time effect.
- Review and approval of the proposal by the appropriate parties, including the client, the contractor and any relevant consultants.
- Recording the variation in a formal written variation order, with the agreed cost and time effect confirmed in writing.
Variation orders must be managed carefully so that the project is completed on time, within budget and to the required quality standard.
