Dealing with Unauthorized Change Orders: PM Directions vs. Contracting Officer Authority

The field environment on a commercial or federal project moves fast. Deadlines are tight, material delivery windows are narrow, and unexpected structural conflicts occur daily. When a crisis hits the field, a General Contractor's Project Manager or a government agency’s technical representative will walk up to your foreman and give a direct order: "We need to alter this routing pattern immediately. Do it now to keep the schedule on track, and we will catch up on the paperwork during the next billing cycle."

Your crew acts in good faith. You reroute materials, authorize overtime, and deploy equipment to handle the emergency.

But weeks later, your formal change order request gets completely rejected. The project owner states that the field modification was completely unauthorized, and they owe you exactly $0. You have just fallen victim to the **Unauthorized Change Order Trap**.

The Law of Implied vs. Actual Authority

Public contracting places substantial weight on **actual authority** and on following the written change procedure. Good-faith field direction does not automatically create authority to change price, scope, or schedule.

Under federal acquisition rules, only contracting officers may enter into or modify Government contracts within the limits of their delegated authority. CORs and technical personnel may have delegated administrative duties, but their appointment normally does not authorize them to change contract price, scope, delivery, or other terms unless specific authority exists.

For a subcontractor, the immediate question is also contractual privity: who at the prime may direct your work and what procedure preserves a request for additional time or money. A Government field instruction does not by itself guarantee a direct payment right for a subcontractor.

The "Constructive Change" Catch-22

General contractors capitalize on this framework by inserting aggressive boilerplate text into subcontracts that forces you to choose between two catastrophic options:

1. If you refuse to perform the extra work until a formal, written modification is signed by the CO, the GC will threaten to declare you in default for **disrupting the project schedule**.
2. If you perform the work to keep the peace, you assume the entire financial risk of the modification being rejected during the final closeout audit.

To survive this system, you must understand how to safely convert an unauthorized verbal order into a legally recognized **Constructive Change** before your crews deploy their tools.

Establishing an Unshakeable Field Routine

Use a disciplined change-management process so field direction, cost, schedule impact, and contractual notice are documented consistently:

• Issue an Immediate Written Directive Notice: When a verbal change is requested, send prompt written notice consistent with the subcontract before proceeding when practicable: *"Pursuant to your field direction on June 2, we are proceeding with the re-routing modification under protest. We estimate the impact to be $12,500 and 3 working days, and expect a formal written modification from the Contracting Officer within 48 hours."*
• Segregate All Tracking Codes: Instruct your field foreman to track every single hour of labor and every line item of material used for that specific modification on a separate, dedicated timecard stamped "Disputed Field Directive." Never blend change-order labor with your base scope logs.
• Strike Out "Work First, Settle Later" Boilerplate: Review any continue-performance or work-first-settle-later clause with counsel so the team understands when it must proceed, when it may pause, and how disputed changes are preserved.