Change Order (Changes Clause)
Also known as: Changes clause order, directed change
What you do here: Perform the within-scope change, give written notice, and claim an equitable adjustment
At a Glance
- Who signs it
- The contracting officer, under the Changes clause authority
- What it does
- Directs a within-scope change to the drawings, specs, method, or timing
- Governing authority
- FAR 43.201 (policy); the Changes clause, e.g. FAR 52.243-1
- Must be within scope
- Only changes within the contract's general scope — beyond it is a cardinal change
- Your remedy
- Equitable adjustment to price and/or delivery for the impact
What It Is
A change order is a written, unilateral order issued by the contracting officer under the authority of the Changes clause (FAR 43.201; the clause itself is FAR 52.243-1 for fixed-price supply, with parallel clauses for services, construction, and other types). It directs the contractor to make a change within the general scope of the contract — for a supply contract, changes in the drawings, designs, specifications, method of shipment or packing, or place of delivery. The contractor must comply. In exchange, the Changes clause entitles the contractor to an equitable adjustment to the contract price, the delivery schedule, or both, to account for the increase or decrease in the cost and time of performance the change causes. Two boundaries define the change order: it must be *within scope* (a change beyond the general scope of the bargain is a cardinal change the government can't impose unilaterally), and the contractor must assert its right to an adjustment within the time the clause requires. The change order gets the work moving immediately; the equitable adjustment settles the money afterward, usually in a bilateral modification.
When You See It
- When the government needs a within-scope change to the specifications, drawings, method, or timing during performance.
- When the customer's needs shift mid-contract but the essential bargain stays the same.
- When the contracting officer wants work to proceed now and price the impact later.
- As the trigger for an equitable adjustment and, ultimately, a definitizing bilateral modification.
Key Features
| Feature | What It Means |
|---|---|
| Within the general scope | A change order can only direct changes within the contract's general scope; anything beyond it is a cardinal change requiring a new procurement. |
| Contractor must perform | A valid change order is mandatory — you perform the directed change and cannot treat it as optional. |
| Right to an equitable adjustment | The Changes clause entitles you to adjust price and/or schedule for the cost and time the change causes, up or down. |
| Notice and timing rules | The clause sets a time to assert your right to an adjustment (often 30 days from the change order); miss it and you risk your recovery. |
| Different clause per contract type | FAR 52.243-1 covers fixed-price supply; there are parallel Changes clauses for services (52.243-3/-4), construction (52.243-4), and cost-reimbursement (52.243-2). |
The SDVOSB Angle
Change orders are the single most common way a profitable set-aside turns into a loss for a small prime, because you perform on the government's timeline and get paid on the government's paperwork clock. Treat every change order as a two-step obligation: perform, and simultaneously protect your equitable adjustment. Diary the notice deadline in your Changes clause, open a cost-segregation file the day the change lands, and quantify the ripple effects (disruption, rework, extended overhead) — small firms routinely under-claim these. If a "change order" actually adds work outside the contract's scope, flag it: that out-of-scope work should be a new SDVOSB set-aside opportunity, not free growth for the incumbent.
How to Handle It
- Confirm the change is within the contract's general scope — flag anything that looks like a cardinal (out-of-scope) change.
- Perform the directed work; a valid change order is not optional.
- Give the contracting officer written notice and assert your right to an equitable adjustment within the clause's timeframe.
- Open a cost-segregation file: track added labor, materials, subcontracts, disruption, and schedule impact.
- Negotiate and definitize the equitable adjustment in a bilateral modification.
Watch Out For
- Missing the notice/assertion deadline in the Changes clause can bar or shrink your equitable adjustment.
- Under-claiming the ripple effects — disruption, rework, and extended overhead — leaves real money on the table.
- Performing an out-of-scope (cardinal) change as if it were a normal change order, forfeiting the chance to compete new work.
- Relying on a verbal direction: get the change order in writing, or you're at risk on both performance and payment.
Run the Numbers
Frequently Asked
What is a change order under the Changes clause?
A change order is a written, unilateral order the contracting officer issues under the Changes clause (FAR 52.243-1 and its variants) directing the contractor to make a change within the general scope of the contract — for example, to the specifications, drawings, method of performance, or delivery. The contractor must perform, and in return is entitled to an equitable adjustment to the price and/or schedule for the resulting increase or decrease in the cost and time of performance.
What is a cardinal change?
A cardinal change is a change so far beyond the general scope of the original contract that it amounts to a different bargain — the government cannot impose it through the Changes clause. Ordering work outside the scope of the contract as a "change" can be an improper attempt to avoid a new competition. For a small business, a cardinal change is significant: work that should be a new set-aside procurement shouldn't be handed to the incumbent as a change order. If you believe you've been directed to perform a cardinal change, raise it in writing.
How long do I have to respond to a change order?
The Changes clause sets the timeframe — commonly you must assert your right to an equitable adjustment within 30 days from the date you receive the written change order (the clause allows the contracting officer to consider a late assertion before final payment in some cases). Read your specific Changes clause, calendar the deadline, and submit written notice promptly. Do not let the assertion period lapse, because missing it can weaken or bar your recovery for the change.
Primary Sources
- FAR 43.201 — General (issuing change orders)
- FAR 43.205 — Contract clauses (Changes)
- FAR 52.243-1 — Changes—Fixed-Price
Plain-English reference, not legal advice. Contract modification, options, novation, and termination rules are fact-specific, and the FAR and agency supplements are amended from time to time — always read the current FAR text, follow the notice and certification timeframes in your specific contract clauses, confirm the requirements with the contracting officer, and consult qualified counsel before relying on a modification, settlement, claim, or termination position.
Change log (1)
- LaunchedPublished the federal contract modifications, options & change management reference covering how a federal contract changes after award — the bilateral supplemental agreement and the unilateral modification (FAR 43.103), the change order under the Changes clause (FAR 52.243-1), the administrative change (FAR 43.101), the equitable adjustment and the Request for Equitable Adjustment (FAR 43.204 / 43.205), the constructive change doctrine, the options to extend the term and quantity (FAR 52.217-8, 52.217-9, and the Subpart 17.2 quantity options 52.217-6/-7), the novation and change-of-name agreements (FAR Subpart 42.12), and the terminations for convenience and default (FAR Part 49 / 52.249-2 / 52.249-8) — each with an at-a-glance quick-facts card, a when-you-see-it list, a key-features table, an SDVOSB-specific angle, a how-to-handle-it checklist, watch-outs, FAQPage, Article, Dataset, and BreadcrumbList structured data, primary-source FAR citations, and cross-links into the glossary, regulation explainers, clauses, forms, contract types, protest & dispute forums, compliance deadlines, how-to guides, FAQ, and the limitations-on-subcontracting, price-to-win, size-standard, and set-aside eligibility calculators.