52.243-2
Changes-Cost-Reimbursement
FAR 52.243-2 allows the Contracting Officer to unilaterally change certain aspects of a cost-reimbursement contract, but contractors must assert claims for equitable adjustments within 30 days and cannot exceed funded amounts without written modification.
Overview
FAR 52.243-2, Changes-Cost-Reimbursement, establishes the procedures and rights for making changes within the general scope of cost-reimbursement contracts. It allows the Contracting Officer to unilaterally issue written orders to change certain contract elements, such as specifications, delivery, or method of shipment. When such changes affect cost, schedule, or other terms, the contractor is entitled to an equitable adjustment. The clause also outlines the process for asserting claims, dispute resolution, and the limitations on increasing contract funding without formal modification. Several alternates tailor the clause for services, construction, or research and development contracts.
Key Rules
- Unilateral Changes by Contracting Officer
- The Contracting Officer may issue written orders to change drawings, designs, specifications, shipment methods, or delivery locations within the contract’s general scope.
- Equitable Adjustments
- If changes impact cost, schedule, or other terms, the contractor is entitled to an equitable adjustment, and the contract must be modified accordingly.
- Assertion of Adjustment Rights
- Contractors must assert their right to an adjustment within 30 days of receiving the change order, unless the Contracting Officer allows a later submission before final payment.
- Dispute Resolution
- Disagreements over adjustments are handled under the contract’s Disputes clause, but work must continue as changed.
- Funding Limitations
- Contract funding cannot be increased without a written modification; contractors are not obligated to perform beyond the funded amount.
- Alternates for Specific Contract Types
- Alternate versions adapt the clause for services, construction, or R&D contracts, specifying what aspects can be changed.
Responsibilities
- Contracting Officers: Issue written change orders, negotiate equitable adjustments, and ensure contract modifications reflect changes and funding.
- Contractors: Comply with change orders, assert adjustment rights within deadlines, continue performance, and avoid exceeding funding limits.
- Agencies: Oversee compliance with change procedures and ensure proper documentation and funding controls.
Practical Implications
- This clause provides a structured process for managing changes in cost-reimbursement contracts, protecting both parties’ interests. Contractors must be vigilant about deadlines for asserting claims and ensure they do not perform work beyond funded limits. Misunderstanding or missing the 30-day window for adjustments is a common pitfall, as is failing to obtain written modifications for increased funding.