A homeowner walks over while you are already on the job and asks if you can take care of one more thing. Everywhere else in the country, how you handle that is a business decision. In Pennsylvania it is also governed by statute, and the statute is more specific than most contractors realize.
This is the legal side of the change order conversation. That article covers what to say and how to price it. This one covers what Pennsylvania requires you to put on paper, what happens if you do not, and the one requirement that almost every free change order template fails.
What the statute says
The Home Improvement Consumer Protection Act, 73 P.S. 517.1 and following, is Act 132 of 2008. It took effect July 1, 2009 and was amended in 2011. Section 517.9 is the list of prohibited acts, and item six is the one that covers extra work.
Read that as four separate requirements, because that is how it gets read if it ever gets looked at:
- In writing. A conversation on the driveway is not a change order.
- Dated. Not the date of the original contract. The date of the change.
- Signed by both. The contractor and the owner. Your signature alone does not do it.
- A price for each deviation. Not one price for the whole change order.
The fourth one is the one people miss
The statute says the price changes for each deviation. If a single change order covers three things, a lump sum at the bottom does not show a price for each deviation. It shows a price for all of them together, which is a different thing.
Practically, that means your change order needs line items. One row per change, each with its own number, then a total underneath. Most of the free change order templates floating around have a single description box and a single total. Those were not built against this statute.
Your contract has to say it too
Section 517.7(a) opens by stating that no home improvement contract is valid or enforceable against an owner unless it includes everything on the list that follows. Item seven on that list requires a description of the work, the materials to be used, and a set of specifications that cannot be changed without a written change order signed by the owner and the contractor.
So the requirement runs in both directions. The contract has to commit you both to using change orders, and then the change orders themselves have to meet section 517.9(6).
Time and materials
If you work time and materials on residential, section 517.7(a)(8) adds its own rule. You have to give a written initial cost estimate before you start, the contract has to state that costs may not exceed 10 percent above that estimate, and subparagraph D requires a statement that the cost shall not be increased over the initial cost estimate plus the 10 percent without a written change order signed by both parties.
In plain terms, the 10 percent cushion is the whole cushion. Past it, you are back to a signed change order.
What it costs you to skip it
There are two separate exposures here, and contractors tend to only think about the first one.
1. The contract
Under section 517.7(a), a home improvement contract that does not meet the statutory requirements is not valid or enforceable against the owner. That is the clause that turns a billing dispute into a problem.
2. The consumer protection law
Section 517.10 deems a violation of this act a violation of the Unfair Trade Practices and Consumer Protection Law. That is the part worth reading twice, because the UTPCPL is where treble damages and attorney fees live. A dispute over an eight hundred dollar add on does not stay an eight hundred dollar dispute once it lands there.
The correction: skipping it does not automatically mean zero
Search this topic and you will be told, over and over, that without a written change order you cannot collect for the work at all. That overstates it, and the Pennsylvania Supreme Court said so.
In Shafer Electric and Construction v. Mantia, 626 Pa. 258 (2014), affirming 67 A.3d 8 (Pa. Super. 2013), homeowners in Washington County hired a contractor to build a garage addition. The contract did not comply with section 517.7(a). The trial court held that killed every claim, including the contractor's claim in quantum meruit, which is the equitable claim for the value of work actually performed.
The Supreme Court unanimously disagreed. Section 517.7(g) speaks to the remedies available to a contractor who did comply with section 517.7(a). Where the contractor did not comply, that subsection is not implicated at all, so it cannot be the thing that bars an equitable claim.
Before you take any comfort from that, look at what it actually buys you. You lose the contract claim and you are left arguing the reasonable value of the work in front of a judge, with your records as the only evidence. It does nothing about the section 517.9(6) prohibited act, and nothing about the consumer protection exposure that follows from it. It is a backstop for a contractor who already made the mistake. It is not a reason to work without the paper.
What this does not cover
- New home construction. Outside the act.
- Commercial work. Outside the act. Your commercial change orders are governed by whatever your contract says, which is usually stricter about notice and timing than this statute is.
- Anything outside Pennsylvania. Other states have their own home improvement statutes and they do not match. The general rules in the change order article apply anywhere. The section numbers on this page do not.
What a compliant change order looks like
Everything on this list comes straight out of the two sections above. Nothing here is a nice to have.
- The original contract number, so the change order is tied to the agreement it is modifying
- The date the change was agreed
- One line per change, describing the deviation from the plans or specifications
- A price change next to each line, not one figure for the lot
- A total, and ideally the new contract total so the owner sees where the job now stands
- Any effect on the completion date
- Signature and date blocks for both the contractor and the owner, on the same page as the scope and the price
That last point is worth saying out loud. A signature page that is physically separate from the work and the money is the first thing attacked in a dispute. Keep it on one sheet.
Sources
- Home Improvement Consumer Protection Act, Act 132 of 2008, 73 P.S. 517.1 to 517.19, as published by the Pennsylvania Office of Attorney General. Sections 517.7(a), 517.9(6) and 517.10.
- Shafer Electric and Construction v. Mantia, 626 Pa. 258 (2014), affirming 67 A.3d 8 (Pa. Super. 2013). Supreme Court of Pennsylvania, decided July 21, 2014.
- Home Improvement Consumer Protection Act information sheet, Pennsylvania Housing Finance Agency.
This page describes what the Pennsylvania statute requires. It is not legal advice and it is not a substitute for a lawyer reviewing your contract documents. If you are in a live dispute over work already performed, talk to an attorney rather than relying on a form.
Frequently Asked Questions
Does a change order have to be in writing in Pennsylvania?
Yes, if the change is a material deviation from the plans or specifications in a home improvement contract. Section 517.9(6) of the Home Improvement Consumer Protection Act lists deviating from or disregarding plans or specifications without a written change order as a prohibited act. A verbal agreement does not satisfy it, no matter how clearly both sides remember it.
Does the homeowner have to sign the change order?
Yes. The statute requires the change order to be dated and signed by both the contractor and the owner. A contractor signature alone does not meet the requirement, and neither does an email saying go ahead.
Can I put one total on the change order instead of pricing each item?
The statute calls for the accompanying price changes for each deviation. If one change order covers three separate changes, a single lump sum at the bottom does not show a price for each deviation. List each change on its own line with its own price, then total them.
Does this apply to commercial work?
No. The Home Improvement Consumer Protection Act governs home improvement work on a private residence. It does not cover new home construction, and it does not cover commercial projects. Commercial change orders are governed by whatever the contract itself says.
What if I already did the work and never got a change order signed?
You are not automatically at zero. In Shafer Electric and Construction v. Mantia, decided in 2014, the Pennsylvania Supreme Court held that Section 517.7(g) does not bar a claim in quantum meruit when the contract failed to comply with Section 517.7(a). The contract claim is gone, but a claim for the value of the work can survive. That is a slower and more expensive road than a signed sheet of paper, and it does nothing about the separate consumer protection exposure.
For the business side of the same problem, how to price the extra work and say it out loud without the customer feeling nickel and dimed, see change orders and scope creep.