Introduction
Variations are common in construction projects. During execution, the employer may require changes in the design, specifications, quantities, scope of work or construction methodology. These changes may arise due to revised requirements, site conditions, design deficiencies, statutory requirements or unforeseen circumstances.
Although variations are often necessary for successful project delivery, they can create disagreements between the employer and contractor regarding additional payment, applicable rates, extension of time (EOT) and other financial consequences.
A variation claim is a submission by the contractor seeking an adjustment to the Contract Price and, where justified, an extension of time or other contractual relief arising from a change to the original scope of work.
Preparing a variation claim requires proper contractual understanding, technical assessment, cost estimation, programme analysis and supporting documentation.
This article explains how to prepare a variation claim step by step, including the relevant provisions of the FIDIC Red Book 1999 and 2017 editions.
1. What Is a Variation in a Construction Contract?
A variation is a change to the original contractual scope of work instructed or approved in accordance with the contract.
It may involve:
- Increasing or decreasing the quantity of an item of work.
- Changing the quality, type or characteristics of materials.
- Changing the design, dimensions or levels of a structure.
- Omitting certain items of work.
- Adding new items that were not included in the original BOQ.
- Changing the sequence, timing or method of execution.
- Adding or modifying structures, facilities or other project components.
Example:
Suppose a contractor is awarded a highway construction contract that includes a 1,000-metre retaining wall. During execution, the employer’s revised design requires the wall length to be increased to 1,300 metres.
The additional 300 metres represent a change in the original scope. Depending on the contractual provisions, the contractor may be entitled to additional payment and possibly an extension of time if the change affects the completion period.
It is important to distinguish a variation from a contractor’s ordinary obligation to complete the original scope. A contractor cannot automatically claim additional payment merely because the work has become more difficult or expensive. The contractual basis for the additional entitlement must be established.
2. When Can a Contractor Submit a Variation Claim?
A contractor may have grounds for a variation submission in circumstances such as:
A. Change in design: The employer or Engineer issues revised drawings that require additional or modified work.
B. Change in specifications: The employer requires a different grade of concrete, material, equipment or construction standard.
C. Additional work: New items are introduced that were not included in the original scope.
D. Increase or decrease in quantities: The actual quantities differ from the BOQ quantities. Whether this is a variation or ordinary remeasurement depends on the contract type and its provisions.
E. Change in construction methodology: The employer instructs a different construction method or sequence that changes the contractual work.
F. Omission of work: Certain items are deleted from the original scope. The contractor should examine whether the omission affects its entitlement to payment, loss of profit or other compensation under the contract.
3. Relevant Provisions of the FIDIC Red Book
The FIDIC Red Book is commonly used for building and engineering works designed by the Employer. It contains specific provisions for variations, measurement, valuation, payment and claims.
The relevant clause numbers differ between the 1999 and 2017 editions.
A. FIDIC Red Book 1999
The following provisions are particularly important:
| Clause | Subject | Relevance to Variation Claims |
| Sub-Clause 3.3 | Engineer’s Instructions | Provides the contractual framework for instructions issued by the Engineer |
| Sub-Clause 12.3 | Evaluation | Provides the basis for valuing measured work and determining applicable rates |
| Sub-Clause 12.4 | Omissions | Deals with the valuation of omissions |
| Sub-Clause 13.1 | Right to Vary | Establishes the Engineer’s authority to initiate variations within the contractual limits |
| Sub-Clause 13.2 | Value Engineering | Allows the Contractor to propose changes that may benefit the project |
| Sub-Clause 13.3 | Variation Procedure | Sets out the procedure for implementing and evaluating variations |
| Sub-Clause 13.5 | Provisional Sums | Deals with expenditure against provisional sums |
| Sub-Clause 13.6 | Daywork | Provides for valuation of certain work on a daywork basis |
| Sub-Clause 20.1 | Contractor’s Claims | Sets out the procedure for claims for additional payment and/or EOT |
Under Sub-Clause 13.1, the Engineer may initiate a Variation before the issue of the Taking-Over Certificate for the Works. The Engineer’s authority and any contractual restrictions must be considered.
Sub-Clause 13.3 establishes the variation procedure, including requests for proposals, instructions and the submission of particulars.
Sub-Clause 12.3 is particularly important when determining whether existing BOQ rates can be used or whether new rates should be established.
B. FIDIC Red Book 2017
The 2017 edition provides a more detailed variation procedure.
| Clause | Subject | Relevance to Variation Claims |
| Sub-Clause 3.5 | Engineer’s Instructions | Provides the procedure for Engineer’s instructions |
| Sub-Clause 3.7 | Agreement or Determination | Deals with agreement or determination of matters under the contract |
| Clause 12 | Measurement and Valuation | Provides the framework for measurement and valuation |
| Sub-Clause 13.1 | Right to Vary | Establishes the right to initiate variations |
| Sub-Clause 13.2 | Value Engineering | Deals with value engineering proposals |
| Sub-Clause 13.3.1 | Variation by Instruction | Sets out the procedure following an instruction for a variation |
| Sub-Clause 13.3.2 | Variation by Request for Proposal | Deals with requests for proposals before instructing a variation |
| Sub-Clause 13.5 | Daywork | Deals with daywork valuation |
| Sub-Clause 20.2 | Claims for Payment and/or EOT | Provides the general claims procedure where applicable |
Important distinction: In the 2017 edition, the variation particulars and valuation process under Sub-Clause 13.3 should be distinguished from a separate claim under Sub-Clause 20.2. Do not automatically treat every variation valuation as a separate claim requiring the full Clause 20.2 procedure. Check the wording of the relevant entitlement and the specific contractual provisions.
4. Step-by-Step Procedure for Preparing a Variation Claim
Step 1: Identify the Variation and Establish Its Contractual Basis
The first step is to identify exactly what has changed from the original contractual scope.
The contractor should compare:
- Original contract drawings.
- Revised or additional drawings.
- Original technical specifications.
- Revised specifications.
- BOQ quantities and descriptions.
- Engineer’s instructions.
- Site conditions and relevant records.
The contractor should clearly explain why the work constitutes a variation and identify the relevant contractual provision.
Example:
Original drawing: Retaining wall of 1,000 metres.
Revised drawing: Retaining wall of 1,300 metres.
Variation: Additional 300 metres of retaining wall.
The contractor should attach both drawings and highlight the changed portion.
Step 2: Obtain a Formal Instruction or Approval
A variation should be processed in accordance with the contractual procedure.
The contractor should obtain and retain:
- Engineer’s instruction.
- Approved revised drawings.
- Written confirmation of the changed scope.
- Relevant correspondence.
- Any required approval of the variation proposal.
Under FIDIC 1999, Sub-Clause 13.3 deals with the variation procedure.
Under FIDIC 2017, Sub-Clause 13.3.1 deals with variation by instruction, while Sub-Clause 13.3.2 deals with a variation initiated through a request for proposal.
A contractor should not assume that every site discussion, meeting minute or informal direction automatically constitutes an authorised variation. Where an instruction is unclear or its contractual status is uncertain, the contractor should promptly seek written clarification in accordance with the contract.
Step 3: Prepare a Detailed Description of the Variation
The variation submission should clearly explain the additional, modified or omitted work.
It should include:
- Description of the original scope.
- Description of the revised scope.
- Reason for the change.
- Reference to the instruction and revised drawings.
- Location and extent of the affected work.
- Comparison of original and revised quantities.
- Construction methodology and resource requirements.
A clear comparison helps the Engineer understand the nature and extent of the variation.
Step 4: Calculate the Additional or Reduced Quantities
The next step is to calculate the quantity difference between the original contractual scope and the revised scope.
For example:
| Particulars | Original Quantity | Revised Quantity | Variation Quantity |
| Retaining wall concrete | 1,000 m³ | 1,300 m³ | +300 m³ |
| Reinforcement steel | 120 MT | 156 MT | +36 MT |
| Excavation | 2,000 m³ | 2,400 m³ | +400 m³ |
The contractor should submit detailed quantity calculations, measurement sheets, drawings and relevant site records.
The quantities should be measured using the contractual method of measurement and should avoid duplication with quantities already included in the original BOQ.
Step 5: Determine the Applicable Rates
Rate determination is one of the most important aspects of a variation claim.
The contractor should examine whether the original BOQ rates are applicable or whether new rates need to be established.
Generally, the following approaches may be relevant:
A. Existing BOQ rates
Where the varied work is similar in character and executed under similar conditions to the original work, the existing BOQ rates may be applicable, subject to the contract.
Example: If the original BOQ rate for M30 concrete is Rs. 8,000 per cubic metre and the additional concrete work is of the same nature and under similar conditions, the existing rate may be used.
B. Adjusted BOQ rates
Where the nature or conditions of the varied work differ from those of the original work, an adjustment to the existing rate may be justified under the applicable contractual provisions.
Example: Concrete work originally planned at ground level may now be required at a significantly greater height, involving different equipment, access arrangements and handling requirements. The contractor should demonstrate why the original rate is not appropriate and substantiate the proposed adjustment.
C. New rates
Where no suitable rate exists in the BOQ, the contractor may propose a new rate based on a detailed cost analysis.
The analysis may include:
- Material costs.
- Labour costs.
- Plant and equipment costs.
- Transportation and handling.
- Wastage, where contractually allowable.
- Applicable overheads and profit.
- Other relevant cost components permitted by the contract.
Under FIDIC 1999, Sub-Clause 12.3 deals with evaluation, including circumstances in which a new rate or price may be appropriate.
Under FIDIC 2017, the valuation framework is contained in Clause 12, read with the variation procedure in Clause 13.
Step 6: Prepare a Detailed Cost Calculation
The contractor should prepare a separate cost estimate for each variation item.
Example: Additional Retaining Wall Work
Assume the revised design requires an additional 300 m³ of concrete.
| Particulars | Quantity | Rate | Amount |
| Concrete M30 | 300 m³ | Rs. 8,000/m³ | Rs. 24,00,000 |
| Reinforcement steel | 36 MT | Rs. 75,000/MT | Rs. 27,00,000 |
| Excavation | 400 m³ | Rs. 500/m³ | Rs. 2,00,000 |
| Total | Rs. 53,00,000 |
Therefore, the proposed value of the additional work is Rs. 53 lakh, before any applicable taxes or other contractual adjustments.
The calculation should be supported by rate analysis, supplier quotations, invoices, labour records, equipment records and other relevant documents.
The contractor should also explain the basis of each rate and demonstrate that the proposed costs are attributable to the variation.
Step 7: Assess the Impact on Project Completion Time
A variation may increase the quantity of work, require additional resources or change the construction sequence.
Therefore, the contractor should assess whether the variation affects the Time for Completion.
The time impact analysis should include:
- Original approved programme.
- Revised programme incorporating the variation.
- Activities affected by the change.
- Additional duration required.
- Effect on critical path activities.
- Availability of labour, materials and equipment.
- Any concurrent delays or mitigation measures.
For example, if the additional retaining wall work requires 30 days and delays a critical-path activity, the contractor may have grounds to seek an EOT, subject to the contract and the actual programme impact.
However, additional work does not automatically entitle the contractor to an extension of time. The contractor must demonstrate that the variation has delayed completion and that the contractual requirements for EOT are satisfied.
Under FIDIC 1999, Sub-Clause 8.4 deals with Extension of Time for Completion. Under FIDIC 2017, the corresponding provision is Sub-Clause 8.5.
Step 8: Assess Other Financial Consequences
In addition to the direct cost of the varied work, the contractor should examine whether the variation has caused other recoverable costs.
These may include:
- Additional mobilisation and demobilisation.
- Additional plant and equipment deployment.
- Extended site overheads.
- Additional supervision and management costs.
- Disruption or loss of productivity.
- Additional temporary works.
- Other demonstrable costs permitted by the contract.
Such costs should not be added automatically to every variation. The contractor must establish the contractual basis, causation and supporting evidence for each claimed amount.
For example, if a variation extends the project completion period, the contractor may have a separate entitlement to prolongation costs where the contract permits and the relevant requirements are met.
Step 9: Prepare and Submit the Variation Claim
The contractor should consolidate the contractual, technical, financial and programme information into a structured submission.
A recommended variation claim format is:
- Cover letter and claim reference.
- Executive summary.
- Contract details and relevant clauses.
- Background and description of the variation.
- Original versus revised scope.
- Engineer’s instruction and revised drawings.
- Quantity calculations.
- Rate analysis and cost breakdown.
- Programme and time impact assessment.
- Additional cost details, where applicable.
- Supporting documents and records.
- Summary of the amount and EOT requested.
The submission should be made within the time limits and in the manner prescribed by the contract.
Step 10: Follow Up and Obtain Agreement or Determination
After submission, the contractor should maintain correspondence with the Engineer and respond to requests for clarification or additional particulars.
The Engineer may review the quantities, rates, cost records and programme impact before agreeing or determining the variation’s value and any applicable time adjustment.
Under FIDIC 1999, the relevant agreement or determination provisions include Sub-Clause 3.5.
Under FIDIC 2017, Sub-Clause 3.7 deals with agreement or determination.
The contractor should ensure that approved variations are properly recorded and reflected in interim payment applications and the updated Contract Price.
5. Important Time Limits Under FIDIC
The contractor should distinguish between the procedure for submitting variation particulars and the general procedure for contractual claims.
| Particulars | FIDIC 1999 | FIDIC 2017 |
| Variation procedure | Sub-Clause 13.3 | Sub-Clause 13.3.1 and 13.3.2 |
| Contractor’s general claims procedure | Sub-Clause 20.1 | Sub-Clause 20.2 |
| Notice of Claim under general claims procedure | Generally 28 days | Generally 28 days |
| Fully detailed claim under general claims procedure | Generally 42 days | Generally 84 days |
The above claim periods relate to the general claims procedure and should not be confused with the specific submission requirements for variation particulars.
For example, under the FIDIC 2017 Red Book, Sub-Clause 13.3.1 generally requires the contractor to submit detailed particulars of an instructed variation within 28 days of receiving the instruction, unless another period is agreed.
The applicable contract wording, Particular Conditions and any amendments must always be checked. A variation submission and a separate claim for additional time or cost may involve different procedural requirements.
6. Common Mistakes While Preparing Variation Claims
The following mistakes frequently lead to disputes or rejection of variation submissions:
1. Carrying out additional work without proper documentation: The contractor should maintain written instructions, approvals and supporting records.
2. Not establishing the contractual basis: A claim should identify the relevant contractual entitlement rather than merely stating that additional work was performed.
3. Using unjustified rates: Proposed rates should be supported by the contract’s valuation provisions and a reasonable cost analysis.
4. Inadequate quantity calculations: All additional or omitted quantities should be supported by drawings, measurements and site records.
5. Ignoring the time impact: A variation claim should assess whether the change affects the critical path and completion date.
6. Including unrelated costs: Costs that are not caused by the variation should not be included in the claim.
7. Missing contractual deadlines: The contractor should maintain a notice and submission register to track all applicable time limits.
8. Failure to maintain contemporary records: Daily reports, labour records, equipment logs, material invoices, measurement sheets and site instructions are important evidence.
7. Practical Checklist for Preparing a Variation Claim
Before submitting a variation claim, the contractor should verify the following:
- Original scope and revised scope clearly identified.
- Relevant contractual clause identified.
- Engineer’s instruction or other contractual basis available.
- Revised drawings and specifications attached.
- Detailed quantity calculations prepared.
- Applicable BOQ rates examined.
- New or adjusted rates supported by analysis.
- Cost breakdown and supporting documents attached.
- Programme impact assessed.
- EOT justification prepared, where applicable.
- Additional financial consequences substantiated.
- Contractual notice and submission deadlines checked.
- Claim submitted through the prescribed contractual procedure.
Conclusion
Preparing a variation claim requires a systematic approach involving contractual interpretation, technical assessment, quantity measurement, rate analysis, cost calculation and programme evaluation.
Under the FIDIC Red Book, Clause 13 provides the main framework for variations and adjustments, while Clause 12 deals with measurement and valuation. The relevant claims provisions must also be considered where a separate entitlement to additional payment or EOT arises.
A well-prepared variation claim should clearly establish what has changed, why the change is contractually payable, how the amount has been calculated and whether it has affected the project completion period.
For contractors, consultants, engineers and contract managers, maintaining proper records and following the contractual procedure from the beginning can significantly reduce disputes and improve the timely settlement of variation claims.
Remember: A successful variation claim is not simply a request for additional payment. It is a properly substantiated contractual submission supported by instructions, measurements, cost records and programme analysis.
Also read: Extension of Time (EOT) Claim in Construction
