Quantifying labour impact cost due to change orders

Change orders are an integral part of most construction projects. Their impact on labour productivity is well established in literature and practice. However, quantifying change order impact on labour productivity continues to be a challenging issue and a source of dispute between Employers and Contractors. The currently used methods in quantifying the change order impact on labour productivity are based on statistical models, historical data, or unimpacted labour productivity period. Therefore, there is a need to expand these methods to include a standardized method to quantify the change order impact. This article presents a new method to quantify the labour productivity loss due to change order impact on the project base scope. The proposed method deploys many project management techniques such as scheduling, change order analysis, earned value, progress tracking and cost estimation to accurately estimate the loss of labour productivity due to change orders. The method was implemented during the construction phase of an electrical project to confirm its applicability and usefulness to the construction industry. The project parties were able to prove that the change orders had impacted labour productivity and accurately quantified their impact.