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Variation Order (Change Order) (EN)
A formal instruction from the employer (or Engineer under FIDIC) directing the contractor to alter the scope, quality, quantity, sequence, or timing of the works. Variations are one of the most common sources of construction disputes in the GCC, particularly on megaprojects where design evolution during construction is frequent. Under FIDIC 2017, the Engineer may instruct a variation under Clause 13.1 (Variation by Instruction) or the contractor may propose one under Clause 13.2 (Value Engineering). The contractor is entitled to additional payment and/or time if the variation impacts the contract price or programme.
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A variation order (also called a change order) is a formal instruction from the employer or the Engineer directing the contractor to change the scope, quality, quantity, or timing of the construction works. It is one of the most common features of major construction projects, particularly in the GCC where design development during construction is frequent. The contractor is generally entitled to additional payment and/or an extension of time if the variation impacts cost or programme.
Under most standard-form contracts (including FIDIC), the contractor generally cannot refuse a variation instruction — the principle is 'comply and claim.' The contractor must carry out the varied work and then seek a determination of the additional cost and time entitlement. However, a contractor may object if the variation falls outside the scope of the contract, if it is impossible to execute, or if cumulative variations fundamentally change the nature of the works.
Under FIDIC 2017 Clause 13.3, variations are valued using contract rates where applicable, adjusted rates where conditions differ from those contemplated by the contract, or new rates agreed between the parties. If the parties cannot agree, the Engineer makes a fair determination. Day-work rates may apply for work that cannot be properly valued by measurement. The contractor must submit detailed proposals within the contractual time limits.
A variation is an instruction to change the works — it is a contractual mechanism initiated by the employer or Engineer. A claim is a request by the contractor for additional payment or time arising from an event or circumstance — such as employer delay, unforeseeable conditions, or a variation instruction. Variations frequently give rise to claims when the parties disagree about the cost or time impact of the varied work.