Cost of Change Order Sum. Do we include Labor Specified in Question or just Contractors Overhead Rate?



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    Christopher Hopstock

    Hey Michael - 

    The key here is that the proposal allocated a $5000 allowance for the cost of the desk (i.e. the material cost) and then the actual cost of the desk ended up being higher.  The original proposal already included (or should have included) the labor to install the desk - just because the desk is now more expensive, the labor cost doesn't necessarily increase.  If this question said 'it took the laborers an additional X hours at $Y per hour' then I'd add that additional labor to the change order cost.

    Therefore, this particular change order should include only the cost of the desk itself, plus contractor OH&P.  There's no formula that you can always use - each situation is different so it's really important to understand the facts and ask yourself 'what is being added to the contractor's original scope of work, that they haven't already included?'

    Chris Hopstock RA
    Black Spectacles
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    Michael Zampolin

    I do understand that each situation is different but I wasn't sure why the labor wasn't included in the Change order sum for this question. I now understand that the question was just providing extra information that was not needed. I will be on the lookout for "Additional Labor" in future questions like this. Appreciate your time! Thank you!

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