In this communication, we take a deeper dive into a valuable feature in GCPay that you may not yet be aware of, but could benefit from using! 

GCPay’s Change Order Process

Mitigates Legal Risk

According to the American Bar Association, change orders create a lot of work for construction lawyers. Owners and contractors can never seem to agree on whether something is a change (which costs more money) or part of the original contract scope (and included in the original price).

Here are legal tips to help mitigate change order disputes:

• Figuring out whether a change order is justified is fact-specific. To determine whether a "change" is really a change, look at pre-bid documents, responses to RFIs, field work orders, and the parties' course of dealing.
  
  
• Contractors often proceed with extra work without first securing a written change order. If the contractor doesn't does not have a written change order or CCD, consider whether the parties may have waived the requirement through their words or actions.
  
  
• A change to one contract doesn't does not necessarily change another. If the owner and the contractor execute a change order, but the contractor fails to obtain a change order from its subcontractor, there may be a gap in the scope of work. Be sure subcontractor clients get the change orders they deserve.

In a recent GCPay market study, over 50% of general contractors expected to see more change orders submitted in 2024 than last year. So having an established change order process is more necessary now than ever.

GCPay’s ability to create and track all change orders in a central repository that’s transparent to both general contractors and subcontractors, mitigates the potential of a dispute between the two parties.

For users with supported, integrated ERPs, GCPay automatically pulls in approved change orders for subcontractors to bill against. You can even require subcontractors to further detail change order line items by using our constrained change order setting. Alternatively, you can pull them in as they were written in the ERP.

Users who are not integrating GCPay with their accounting ERP, have multiple options for creating change orders.

• An unconstrained change order acts like a traditional CO that would be submitted and proceeds through the approval process predetermined by the user.

• A constrained change order is issued by the general contractor with a set value that requires the subcontractor to breakout each line, as well as the specified amounts. This CO will need to be detailed by a subcontractor and then approved by the GC before it can be billed against.

For a step-by-step guide to creating a constrained change order, click the button below.