How is a construction change order priced in the US?
A change order equals the direct cost of the added work (labor, materials, equipment, subcontractor costs) plus a contractually specified markup for overhead and profit, plus bond and applicable sales tax, less credits for deleted work. AIA and ConsensusDocs forms specify the allowable pricing methods.
Can I be forced to perform changed work before the price is agreed?
Often yes. Most contracts contain a 'changes' clause and a construction change directive (CCD) mechanism that lets the owner order you to proceed with changed work while the price is determined later under the contract's cost rules. You must still preserve your right to be paid by following notice requirements.
What overhead and profit markup is allowed on change orders?
It is set by the contract. Many contracts cap markup — commonly 10–15% on the contractor's own work and 5% on subcontractor-performed work. Public contracts frequently prescribe fixed allowable markups. Absent a cap, a reasonable and customary markup applies.
What happens if I do extra work without a written change order?
You risk non-payment. Most contracts require written authorization for extras, and owners routinely deny claims for undocumented changes. Protect yourself with a signed change order or a written change directive before starting the work.