What Is a Variation Order (VO)?
A variation order is a formal change to the contract scope — an addition, an omission or a substitution — with a documented effect on value and time.
Definition
Changes arise during execution: a new item, a materially different quantity, an alternative specification, or an unforeseen site condition. A variation order documents the change with the approval of the authorised party before the work is done, stating its effect on price and on time — turning a potential dispute into a clear agreement.
Pricing a variation
The default is to price from the contract unit rates for comparable items; for entirely new items, new rates are built up from analysis (materials + labour + plant + indirects + profit) and approved. Recording the basis of the rate at the time it is agreed protects both parties at final account.
Effect on time
A variation may earn an extension of time if it affects the critical path — proving it requires an updated programme and an impact analysis. That is one more reason to keep your schedule current.
Worked example
A villa contract includes 60×60 porcelain tiles; the client asks for natural marble. The variation order records the rate difference of SAR 180/m² × 350 m² = SAR 63,000 added, and two weeks’ extension for the marble supply — signed before the work starts.
FAQ
Should a contractor act on a verbal instruction?
It is a serious risk: contracts normally require prior written approval, and working without a documented order can mean working unpaid. The correct step is a notice and a request for a variation order before starting.
What is the difference between a variation and a claim?
A variation is a change agreed in advance; a claim is a later request for compensation for an effect that was never agreed — and mature projects convert as much of the second into the first as they can.
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