M03.01
Contracts, extras, and the paper we live on
Lump sum, unit price, T&M, purchase orders, and why verbal extras are unpaid gifts.
- Identify the contract type on a job file header
- Issue a PCO instead of a shrug
- Know what a proceed-at-risk looks like — and that only Eric grants it
Contract types you will see
Lump sum / stipulated sum: we own the specified scope for a number. Unit price: SF/LF/EA at agreed rates — quantities must be measured and agreed. T&M / cost-plus: hours and materials with markup, needs daily tickets signed. Purchase orders from a plant: often short, one-sided, and still binding — read the terms, insurance, indemnity, and payment before we celebrate the PO number.
- 01Capture the ask
- 02Hold extra work
- 03Photo + quantities
- 04Estimating prices
- 05Issue PCO
- 06Written proceed
- 07Ticket separately
- 08Bill on its own line
When someone asks for 'a little more while you're here'
- 01Capture
Who asked, date, exact request, photos, location.
- 02Do not mobilize on it
Tell field: hold that extra. Continue base scope if it is safe to do so.
- 03PCO
Potential change order: description, quantity, price, time. Issued same day if possible.
- 04Written proceed
Signed CO, or written 'proceed' from someone with authority, or Eric's documented risk acceptance.
- 05Then work
Ticket the extra separately. Bill it on its own SOV line.
Takeaways
- Scope lives in the signed documents plus executed changes.
- A GC's urgency is not authorization.
- If we start unpaid extra work, we chose to donate.
SOPSOP Section 2.14 / 4.9 — Legal, COI & Paid-if-PaidSOP Section 4 — Administrative Staff