Jenner & Block

Claims and Equitable Adjustments

Government contracts contain one of the most unique clauses encountered in business -- the “Changes” clause -- which allows the government to disregard the specifications and require a company to perform work that is different from what the company originally proposed (and budgeted, staffed, sequenced, subcontracted, and scheduled).  There is nothing comparable in the commercial contract world.   Whether the government exercises this extraordinary right properly through a written directed change by the Contracting Officer, or more commonly, through a “constructive” or “informal” change by government program or technical personnel, the results of changes often are significant cost overruns, dramatic schedule slips, and strained working relations with the government.  In extreme cases, the results of unmanaged changes are civil or criminal investigations and congressional inquiries.