Getting Paid for Variations: A Practical Guide for Subcontractors

A subcontractor gets paid for a variation by proving three things: that the change was instructed, that it was notified the way the subcontract requires, and what it is worth. Most unpaid variations fail on the first two, not the third. The work was done, everyone on site knows it was done, but there is no written instruction and no notice in time, and by the final account it has become an argument rather than an entitlement.

This guide covers the habits that stop that happening, and what to do when it already has. Subbies tell us the same stories every week, and almost all of them were avoidable.

1. Get the instruction in writing

Most standard subcontracts only pay for variations the contractor has instructed. Site managers give instructions verbally all the time. That is how jobs run, and it is not a problem as long as you confirm each one in writing the same day: what you were asked to do, by whom, where, and that you are treating it as a variation.

Many JCT-based subcontracts have a confirmation procedure: confirm an oral instruction in writing, and if the contractor does not dissent within the set period, it takes effect as if it had been given in writing. Check the periods in your own subcontract and use the procedure every time. An email from your phone on site is enough.

2. Notify it the way the subcontract says

Under NEC there are no variations. A change to the Subcontract Scope is a compensation event, and you have eight weeks from becoming aware of it to notify it under clause 61.3, or you lose the entitlement entirely. Our guides to compensation events and how to notify one cover the process.

Under JCT-based subcontracts, late notice usually affects how much you can prove rather than whether you are paid at all, unless the subcontract has been amended to make notice a condition of payment. Many bespoke subcontracts have been. Read the variations clause before you start work, not after the dispute.

3. Price it early

A price submitted while the work is fresh is far easier to agree than one submitted at the final account. Where you can, price the change before you carry it out. Where you cannot, keep a running cost: labour, plant, materials, and the time lost on the work you were already doing.

Under JCT, variations are valued by the valuation rules in the subcontract, starting from your own contract rates where the work is similar. Under NEC, compensation events are assessed on the change in Defined Cost plus Fee, not on your rates, unless both sides agree otherwise.

4. Keep the records that win

• Daywork sheets signed by the contractor's site team, every day, not in a batch at the end of the month.
• Photographs before, during and after, with dates and locations.
• Marked-up drawings showing what changed against the revision you priced.
• Labour allocation by area, so the variation can be separated from the base scope.
• Every email, site instruction and meeting minute that mentions the change.

Our guide to claim records goes further.

5. Put it in every application

Include every variation in every interim application, valued and supported, even if the contractor has not agreed it. If the contractor intends to pay less than your application, it has to serve a valid pay less notice in time, stating what it considers due and why. A variation left out of your applications is a variation the contractor never has to answer for.

When a variation is refused

First, ask for the reason in writing. "Not instructed", "in your scope" and "your rates are too high" are three different arguments with three different answers, and the answer to each is in the subcontract documents and your records.

Second, check the notices. If the contractor did not serve a valid pay less notice against an application that included the variation, you may be entitled to the full sum applied for now, leaving the valuation argument for later.

Third, do not stop work over a valuation dispute alone. Under section 112 of the Construction Act you can suspend performance if a sum due is not paid in full by the final date for payment and no effective pay less notice was given, but only after at least seven days' written notice. Suspending over a disagreement about value is a different thing, and it can put you in breach.

Finally, if it cannot be agreed, adjudication is available on any construction contract in the UK, it is quick, and it is built for exactly this kind of dispute. We act for subcontractors in variation and final account disputes and will tell you at the start whether yours is worth pursuing.

Variation questions

Can I claim for a variation that was only instructed verbally?

Often yes, if you can prove the instruction and the work. Confirm oral instructions in writing at the time, using the confirmation procedure in your subcontract if it has one, and keep signed daywork sheets and photographs.

How long do I have to claim a variation?

It depends on the contract. Under NEC you must notify a compensation event within eight weeks of becoming aware of it, or the entitlement is lost. Under JCT-based subcontracts there is usually no strict bar unless the subcontract has been amended, but the longer you leave it, the harder it is to prove.

My main contractor says the work was in my scope. What now?

Go back to the documents you priced: the subcontract scope, the drawings and their revision numbers, and the specification. If the work is not in them, it is a change. Set out the comparison in writing and ask the contractor to show where the work is included.

Can I adjudicate over unpaid variations?

Yes. In the UK a dispute over the value of variations is a dispute under the construction contract and can be referred to adjudication at any time. Where the contractor's payment notices were defective, you may also be able to claim the notified sum directly.

Can I stop work if my variations are not paid?

Only if a sum due has not been paid by the final date for payment and no valid pay less notice was given, and only after at least seven days' written notice under section 112 of the Construction Act. Do not suspend over a disagreement about value without advice.