Extra work on a state public job can be paid at agreed prices or by force account, so settle which one before work starts.
Once the crew is on site, the owner already has the work in hand, and your room to negotiate gets smaller with each shift. The estimator's job is to decide the pay basis before the work starts, then make sure the paperwork matches that decision.
Key takeaways
- Test whether the work is outside the contract's scope before you price it as extra.
- Read the change order section and note its number, its title and the form it requires before you build the number.
- Pick agreed prices or force account, and get the owner to agree the basis before work starts.
- Keep daily records for extra work separate from in-scope work.
- Add subcontractor markup only from the section that names it.
The steps below run in the order most estimators should take them. Each one points to language from an official page, and each link goes to the source so you can read the full section for your own job. Where a source is specific to one state or agency, the post says so. Nothing here replaces the contract you are bidding on.
1. Confirm the work is actually extra
Start by testing whether the work is extra at all, because everything after this depends on it. Washington's statute gives a clear definition for one section of its code. It reads: "For the purposes of this section, as it pertains to obligations of an owner, state, or municipality, additional work is work beyond the scope defined in the contract between the contractor and the owner, state, or municipality." ( RCW 39.04.360)
Look closely at the structure of that sentence. It does not define extra work by how hard the work is, how much it costs, or whether the owner asked for it informally. It defines extra work by one comparison: the scope defined in the contract. That makes the first question a document question. You are not asking whether the work is new to your crew or whether it surprised anyone. You are asking whether it falls outside what the contract says the contractor must do.
That test cuts both ways. An item that takes far more labor than you estimated can still be inside scope, and then it is not extra work no matter how painful it is. Estimators often lose money by treating difficulty as if it were scope.
Note that the quoted sentence comes from Washington's code and applies to the section it appears in. Your own state, agency, and contract set the test on your job. Use the Washington wording to frame the question, not as a rule you can carry across the state line.
For each one, record the contract language that covers the surrounding work, the drawing or specification sheet where the item appears or is described, the date you first noticed the difference, and who you told. If you cannot point to contract language on both sides of the line, the item is not ready to be priced as extra work. Send it back for clarification first. A scope log that is written at the time is far more persuasive than one reconstructed at final billing, because the owner can see that the difference was raised before the work was done.
2. Find the change order rules before you price
Next, find the section of the contract or agency manual that governs change orders, and read it before you open the pricing sheet. The California Department of Transportation's construction manual is a useful example of how an agency ties change orders to payment. It says: "Section 5-3, 'Change Orders,' of this manual contains guidance for change orders with payment for extra work at force account." It then adds: "For the format for change orders, refer to Section 5-3, 'Change Orders,' of this manual." ( Caltrans, Chapter 3: General Provisions, Section 9: Payment)
Two points in those lines matter for an estimator. The page connects change orders to payment for extra work at force account, so the section you read first bears on the basis you choose. Second, the format for change orders is found in that same section. That means the form you submit and the basis you claim should come from one place. Estimators who price first and look for the format later often end up reworking numbers to fit a form that was never designed around their assumptions.
The reference also shows a habit worth copying: the page names the section number and the section title in quotation marks. When you cite a rule in a change request, use the same specificity. A reviewer can check "Section 5-3, Change Orders" in seconds. A vague reference to "the change order provisions" invites a delay while someone goes looking for what you meant.
If your job is not in California, the same approach works. Find the change order section in your own contract and in the agency manual that governs it, confirm which payment basis that section names, and write down its section number and title. The Caltrans language is useful as a model of what to look for. It is not a rule for your state, and it should not be applied to a job that is governed by different documents.
Before you finish this step, collect three things: the section number, the form or format the change order must follow, and the date of the version of the manual you are using. Manuals get revised, and the version you priced against is the one that will matter if the basis is disputed.
3. Choose between agreed prices and force account
This is the decision that shapes the rest of the job. The two pay bases named on the Caltrans pages are agreed prices and force account. The table that follows sets each source beside the others, so you can see what each page actually supports.
The Caltrans page lists "Changes and extra work at the agreed prices in accordance with Section 4-1.05A, 'General,' of the Standard Specifications" among its payment provisions. The attraction is predictability. Once the number is agreed, the question of what the work is worth is closed, and the owner and contractor are arguing about execution rather than value. The risk is that agreement usually fixes the number, so you need to be right about quantity, sequence, and cost before the first hour is worked. A price that was reasonable for the work you imagined may not hold once field conditions show up.
Force account is the other basis. The cost is that your records become the basis of payment. If the daily records are thin, the payment is thin too, and the owner can reasonably question any line that is not supported.
Choosing between the two is therefore a question about uncertainty. Where you can define the extra work clearly and you are confident in the cost, agreed prices fit. Where the scope is still moving, force account can fit better, provided you are prepared to keep records that support it. A practical test is to ask which number you could defend if the owner challenged it on the day it was billed. For agreed prices, the defense is the signed agreement. For force account, the defense is the stack of daily records. If you cannot picture either defense for a given item, the basis is not yet clear enough to price.
Whichever you choose, write the basis down and get the owner's agreement before work starts. If the owner will not agree to a basis, the price is not settled, and that is the moment to stop and escalate rather than begin. Starting without an agreed basis turns a pricing question into a dispute, and disputes are slower and more expensive to resolve after the work has been done.
4. Set up the daily record before the first day
The Caltrans page gives a specific instruction for this: "Use Form DOT CEM-4907, 'Tentative Daily Extra Work Agreement,' for this purpose." ( Caltrans, Chapter 3: General Provisions, Section 9: Payment) The form name tells you what it covers. It is a tentative agreement on extra work, and the word "daily" points to a record kept day by day rather than a single final price.
The word "tentative" matters too. It marks the day's record as a working agreement, not a final figure. Its value comes from being prepared while the facts are fresh. A foreman who fills in hours and equipment at the end of a long day is more likely to get the details wrong than one who completes the record before leaving the site.
Build the daily routine around that idea. Each day, record the crew members, hours, equipment, and materials that went into the extra work, and keep them separate from the work already in the contract. Tie the record to the scope log from step 1, so every day's entries point back to the item that was found to be extra. If a day's work touches both extra and in-scope work, split the entries rather than blending them. Blended records are hard to defend under any basis, because the owner cannot tell which hours belong to which item.
Ask for the owner's review before anyone leaves the site. You are not asking for approval of the price on the spot. You are asking the owner's representative to confirm the facts while they are still visible. A disagreement found that afternoon is far cheaper to resolve than one found at final billing, when the people who did the work may have moved to another job.
If your job uses a different form, use the one your contract requires and keep the same daily discipline.
5. Add the subcontractor layer to the price
Many extra items are performed by a subcontractor, and that changes how the price is built. The Caltrans page makes a specific point about this: "Section 9-1.04A, 'General,' of the Standard Specifications includes an administrative markup for the prime contractor when a subcontractor performs the work." ( Caltrans, Chapter 3: General Provisions, Section 9: Payment) For a related check on subcontractor costs, see Sub quote or own crew: 4 relevant cost checks.
Read that sentence carefully. It says the markup exists, and it says who it is for: the prime contractor, when a subcontractor does the work. It does not give an amount, and this post does not supply one. Go to the section it names, find the markup that applies, and use the figure from that section in your estimate. Do not carry a markup from an old bid or from a different agency into the number on this job.
The estimating consequence is that the price needs visible layers. Show the subcontractor's cost on its own line, show the prime's own cost on another, and show the administrative markup on the line where the section says it applies. An owner who sees the layers can check each one. An owner who sees one lump number will ask questions, and the answers will take longer than the layering would have.
Keep the daily records consistent across both parties. If the subcontractor keeps its own record in one format and the prime keeps another, the two will not line up when the owner compares them. Agree on one format, use the same scope references from step 1, and have the subcontractor's entries roll up into the prime's records so the totals can be traced.
Before you add any markup on top of a subcontractor's price, check the section first. The quoted sentence describes the prime's administrative markup for work a subcontractor performs. It does not tell you whether that markup sits on top of other charges, so you will need to read the section yourself and confirm what it allows before you write the subcontractor's line.
6. Sort work-character changes from extra work
Not every changed item is extra work. The Caltrans page draws the distinction by pointing to a different set of sections: "Payment adjustments for work-character changes are made in accordance with Sections 4-1.05B, 'Work-Character Changes,' and 9-1.15, 'Work-Character Changes,' of the Standard Specifications." ( Caltrans, Chapter 3: General Provisions, Section 9: Payment)
The quote tells you two things. Work-character changes have their own payment adjustments, and those adjustments are made under their own sections. It does not tell you how an adjustment is calculated, and this post does not give a method. Read those two sections before you put an item in the wrong column of your estimate, because the wrong column means the wrong set of rules.
The practical question is sorting. Use the scope test from step 1 as the first filter. An item can look like both at first, which is why this sort should happen before work starts, not after the first invoice.
A simple sorting sheet makes this manageable. Put each changed item on one line, with columns for the contract item, what changed, whether the change falls outside scope, which section governs payment, and which form will record the daily work. Fill in every row before the crew moves. Keep the sheet with the scope log from step 1 so both documents can be reviewed together, since the owner will want to see the reasoning behind each placement.
Items that cannot be placed in one column are not ready. Hold them until the owner gives a direction, and record that direction in writing with the date.
7. Record the basis in the change order before work starts
The last step ties the earlier steps together. Before the crew moves to the extra work, the change order should state the pay basis you agreed to, the scope item it covers, the daily record form that will support it, and any subcontractor markup that applies. The Caltrans page treats change orders as the place where both the format and the force account payment guidance live, so the change order is where your agreement should be recorded. ( Caltrans, Chapter 3: General Provisions, Section 9: Payment) For a related checklist on closing out change pay, see Change order pay: 4 steps before final payment.
Check the draft against the list from the earlier steps. Does it cite the scope item from step 1? Does it name the basis from step 3 and the section that governs it? Does it reference the daily record form from step 4, and does that form match the one your contract requires? Has the subcontractor's line been separated, and has the markup been taken from its section, as step 5 requires? Has each changed item been sorted as step 6 directs? A "no" on any of these means the change order is not ready to sign.
If the owner will not sign the basis, record your objection and the date you raised it. Do not start the work on an informal understanding. The purpose of this whole sequence is to avoid a dispute about how the work is paid, so an unresolved basis at the start is a warning sign, not a detail to fix later. Crews that begin on a handshake usually end up reconstructing the agreement from memory, and memory rarely matches the owner's.
Keep the sequence in mind. Confirm the scope, find the change rules, choose the basis, set up the daily record, add the subcontractor layer, sort the adjustments, then record it all before the first hour is worked. Each step depends on the one before it, and skipping ahead usually means redoing the work. The pricing decision is made once, at the start, and the paperwork is how you keep it made.
Next step for today: open your own contract, find its change order section, and write down that section's number, its title, and the form or format it requires. You will need all three before you price any extra item.
Related guides: Public job bid packages: 4 rules for splitting work · Best value bid review: 6 checks before pricing work · Public bid pricing: 8 wage provisions to check.
Frequently asked questions
What should I have before I price extra work?
Have the section number and title of the change order rules, the form or format the change order must follow, and the date of the manual version you used.
Which pay basis fits uncertain scope?
Force account can fit better when the scope is still moving and you can keep daily records to support it. Agreed prices fit when you can define the extra work clearly and are confident in its cost.