52.243-2 Changes-Cost-Reimbursement
Source: FAR 52.243-2 on acquisition.gov
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.
As prescribed in 43.205(b)(1), insert the following clause. The 30-day period may be varied according to agency procedures.
Changes-Cost-Reimbursement (Aug 1987)
(a) The Contracting Officer may at any time, by written order, and without notice to the sureties, if any, make changes within the general scope of this contract in any one or more of the following:
(1) Drawings, designs, or specifications when the supplies to be furnished are to be specially manufactured for the Government in accordance with the drawings, designs, or specifications.
(2) Method of shipment or packing.
(3) Place of delivery.
(b) If any such change causes an increase or decrease in the estimated cost of, or the time required for, performance of any part of the work under this contract, whether or not changed by the order, or otherwise affects any other terms and conditions of this contract, the Contracting Officer shall make an equitable adjustment in the-
(1) Estimated cost, delivery or completion schedule, or both;
(2) Amount of any fixed fee; and
(3) Other affected terms and shall modify the contract accordingly.
(c) The Contractor must assert its right to an adjustment under this clause within 30 days from the date of receipt of the written order. However, if the Contracting Officer decides that the facts justify it, the Contracting Officer may receive and act upon a proposal submitted before final payment of the contract.
(d) Failure to agree to any adjustment shall be a dispute under the Disputes clause. However, nothing in this clause shall excuse the Contractor from proceeding with the contract as changed.
(e) Notwithstanding the terms and conditions of paragraphs (a) and (b) of this clause, the estimated cost of this contract and, if this contract is incrementally funded, the funds allotted for the performance of this contract, shall not be increased or considered to be increased except by specific written modification of the contract indicating the new contract estimated cost and, if this contract is incrementally funded, the new amount allotted to the contract. Until this modification is made, the Contractor shall not be obligated to continue performance or incur costs beyond the point established in the Limitation of Cost or Limitation of Funds clause of this contract.
(End of clause)
Alternate I (Apr 1984). If the requirement is for services and no supplies are to be furnished, substitute the following paragraph (a) for paragraph (a) of the basic clause:
(a) The Contracting Officer may at any time, by written order, and without notice to the sureties, if any, make changes within the general scope of this contract in any one or more of the following:
(1) Description of services to be performed.
(2) Time of performance (i.e., hours of the day, days of the week, etc.).
(3) Place of performance of the services.
Alternate II (Apr 1984). If the requirement is for services and supplies are to be furnished, substitute the following paragraph (a) for paragraph (a) of the basic clause:
(a) The Contracting Officer may at any time, by written order, and without notice to the sureties, if any, make changes within the general scope of this contract in any one or more of the following:
(1) Description of services to be performed.
(2) Time of performance (i.e., hours of the day, days of the week, etc.).
(3) Place of performance of the services.
(4) Drawings, designs, or specifications when the supplies to be furnished are to be specially manufactured for the Government in accordance with the drawings, designs, or specifications.
(5) Method of shipment or packing of supplies.
(6) Place of delivery.
Alternate III (Apr 1984). If the requirement is for construction, substitute the following paragraph (a) for paragraph (a) of the basic clause:
(a) The Contracting Officer may at any time, by written order, and without notice to the sureties, if any, make changes within the general scope of this contract in the plans and specifications or instructions incorporated in the contract.
Alternate IV [Reserved]
Alternate V (Apr 1984). If the requirement is for research and development, and it is desired to include the clause, substitute the following paragraphs (a)(1) and (a)(3) for paragraphs (a)(1) and (a)(3) of the basic clause:
(a) ***
(1) Drawings, designs, or specifications.
(3) Place of inspection, delivery, or acceptance.