VARIATION ORDERS

COURSE OUTLINE

DEFINITION

FORMS OF VARIATION ORDER

PROCEDURES OF EVALUATION
CHECKLIST AS PER D.O. NO. 156, SERIES OF
2015
PROCEDURAL FLOW
REFERENCES RELATED TO VARIATION
ORDERS
Module IV – Variation Order
 
A. Introduction
 
Variation Order generally originates from the request of the Contractor or as
a request from the DPWH seeking a change to the existing contract. It is a written
agreement authorizing an addition, deletion or revision in the work and/or time of
completion within the limits of the contract after it has been executed. It is a
specific type of contract modification that does not go beyond the general scope of
the existing contract. This is emphasized under D.O. 204, series of 2004-
Prescribing Limitations of Variation Orders for Civil Works Contracts which
prescribes that, to quote: “(Variation Orders) shall be limited to the original scope
of the approved original contract.” unquote.
 
Per the IRR of RA 9184, Variation Order may be issued by the DPWH to
cover any increase/decrease in quantities including the introduction of new work
items that are not included in the original contract or reclassification of work
items that are either due to change of plans, design or alignment to suit actual
field conditions resulting in disparity between the pre-construction plans used for
purposes of bidding and the “as stake plans” or construction drawings prepared
after a joint survey by the Contractor and the DPWH after award of the contract
is affected.
 Under the 1999 FIDIC, Clause 13 – Variations and Adjustments Sub-Clause
13.1-Right to Vary, it states that, to quote: “ Variations may be initiated by the
Engineer at any time prior to the issuing of the Taking-over Certificate for the
Works, either by an instruction or by a request for the Contractor to submit a
proposal. The Contractor shall, execute and be bounded by each Variation, unless
the Contractor promptly gives notice to the Engineer stating (with supporting
particulars) that the Contractor cannot readily obtain the Goods required for the
Variation. Upon receiving this notice, the Engineer shall cancel, conform or vary the
instruction.
 
Each Variation may include the following:
 
1. Changes to the quantities of any item of work included in the Contract
2. Changes to the quality and other characteristics of any item of work
3. Changes to the levels, positions and /or dimensions of any part of the works
4. Omissions of any work unless it is to be carried out by others
5. Any additional work, Plant, Materials or services necessary for the
Permanent Works, including any associated Tests on Completion, boreholes
and other testing and exploratory works, or
6. Changes to the sequence or timing of the execution of the Works.”
B. FORMS OF VARIATION ORDER
1. VARIATION ORDERS - CHANGE ORDER/EXTRA
WORK ORDER

1.1. Variation Orders may be issued by the procuring entity to

cover any of the following:
 increase/decrease in quantities, including the introduction of
new work items that are NOT INCLUDED IN THE ORIGINAL
CONTRACT or

 reclassificationof work items that are either due to change of

plans, design or alignment to suit actual field conditions
resulting in disparity between the preconstruction plans used for
purposes of bidding and the "AS STAKED PLANS" or
construction drawings prepared after a joint survey by the
contractor and the Government after award of the contract,
• provided that the cumulative amount of the positive or additive
Variation Order DOES NOT EXCEED TEN PERCENT (10%)
of the original contract price.

• The addition/deletion of works under Variation Orders should be

within the general scope of the project as bid and awarded. THE
SCOPE OF WORKS SHALL NOT BE REDUCED so as to
accommodate a positive Variation Order.
 A Variation Order may either be in the form of
either a change order or extra work order.
 
1.2 A Change Order may be issued by the
implementing official to cover any
increase/decrease in quantities of original
work items in the contract.
 
1.3. An Extra Work Order may be issued by the implementing
official to cover the introduction of new work necessary for
the completion, improvement or protection of the project
which was not included as items of work in the original
contract, such as , where there are subsurface or latent
physical conditions at the site differing materially from those
indicated in the contract, or where there are duly unknown
physical conditions at the site of an unusual nature differing
materially from those ordinarily encountered and generally
recognized as inherent in the work or character provided for
in the contract.
1.4. Any cumulative positive Variation Order beyond ten percent (10%) of the
original contract price shall be subject of another contract to be bid out if
the works are separable from the original contract.
In exceptional cases where it is urgently necessary to complete the original
scope of work, the Head of the Procuring Entity may authorize a positive
variation order that will make the cumulative value of the positive
Variation Orders go beyond ten percent (10%) but not more than twenty
percent (20%) of the original contract price, subject to the guidelines to be
determined by the GPPB.
Provided, however, That appropriate sanctions shall be imposed on the
designer, consultant or official responsible for the original detailed
engineering design which failed to consider the Variation Order beyond
ten percent (10%).
1.5. In claiming for any Variation Order, the contractor shall,
within seven (7) calendar days after such work has been
commenced or after the circumstances leading to such
condition(s) leading to the extra cost, and within twenty-
eight (28) calendar days deliver a written communication
giving full and detailed particulars of any extra cost in
order that it may be investigated at that time.

Failure to provide either of such notices in the time

stipulated shall constitute a waiver by the contractor for
any claim.
C. Elements of Variation Order - a Variation Order
should specify and include the following:
 
a. Identification of Variation Order
b. Description of Change – scope of change
c. Reasons for Change – justification
d. Change of contract price – cost/effect of variation
order
e. Change of contract time – addition/deletion of
contract time
f. Approval of owner and conformity of the
contractor
D. Procedure in the Preparation of Variation Order
 
In claiming for any Variation Order, the Contractor shall, within seven (7)
calendar days after such work has been commenced or after the circumstances
leading to such condition(s) leading to the extra cost, and within twenty-eight
(28) calendar days deliver a written communication giving full and detailed
particulars of any extra cost in order that it may be investigated at that time.
Failure to provide either of such notices in the time stipulated shall constitute a
waiver by the contractor for any claim.

If the Project Engineer finds that a Change Order or Extra Work Order is
justified, proposed Order should be correspondingly prepared, accompanied
with the following:
 
1. Notices submitted by the Contractor,
2. The plans to effect the adjustments,
3. The Contractor’s computations as to the quantities of the additional works
involved per item indicating the specific stations where such works needed,
4. The date of the Project Engineer’s inspections and investigations,
5. The Project Logbook,
6. A detailed estimate of the unit cost of such items of work, together with his
justifications for the need of Change Order of Extra Work Order.
The Project Engineer upon receipt of notice, submits the same to the
Head of the Implementing Office who shall immediately instruct an
investigation to verify the Project Engineer’s report of the need for
variation order. If satisfied that such variation order is justified and
necessary, the Head of the Implementing Office shall after review,
forward the documents to the Central Office. If, after review of the
plans, quantities and estimated unit cost of the items of work involve
and finding that the Change Order or Extra Work Order to be in order
and covered by the CAF, it shall be approved by the appropriate
authority.

The timeframe for the processing of Variation Orders from the

preparation up to approval by the procuring entity concerned shall not
exceed thirty (30) calendar days.
 The 1999 FIDIC General Conditions of Contract provides additional
guidelines as to the preparation of a variation order, to quote: “If the Engineer
requests a proposal prior to instructing a Variation, the Contractor shall respond in
writing as soon as practicable, either by giving reasons why he cannot comply if
this is the case, or by submitting;
(a) a description of the proposed work to be performed and a programme for its
execution;
(b) the Contractor’s proposal for any necessary modifications to the programme
according to Sub-clause 8.3 (Programme) and to the time for completion; and
(c) the Contractor’s proposal for evaluation of the Variation.

The Engineer shall, as soon as practicable after receiving such proposal, respond
with approval, disapproval or comments. The Contractor shall not delay any work
whilst awaiting a response. Each instruction to execute a Variation, with any
requirements for the recording of Costs, shall be issued by the Engineer to the
Contractor, who shall acknowledge receipt.

Each Variation shall be evaluated in accordance with clause 12-Measurement and

Evaluation, unless the Engineer instructs or approves otherwise in accordance with
this Clause.” unquote.
E. Conditions Under Which Contractor Is To Start Work Under Variation
Orders And Receive Payments
 
Under no circumstances shall a contractor proceed to commence work
under any Change Order or Extra Work Order unless it has been approved by
the head of the procuring entity or his duly authorized representative.
Exceptions to the preceding rule are the following:
 
a. The Regional Director or equivalent official may, subject to the availability of
funds, authorize the immediate start of work under any Change or Extra
Work Order under any or all of the following conditions:
 
1) In the event of an emergency where the prosecution of the work is
urgent to avoid detriment to public service, or damage to life and/or
property; and/or

2) When time is of the essence; provided however, that such approval is

valid on work done up to the point where the cumulative increase in the
value of work on the project which has not yet been duly fully approved
does not exceed five percent (5%) of the adjusted original contract price
whichever is less;
 Provided, further, that immediately after the start of work, the
corresponding Change Order or Extra Work Order shall be prepared
and submitted for approval in accordance with the above rules herein
set. Payments for works satisfactorily accomplished on any Change
Order or Extra Work Order may be made only after approval of the
same by the head of the procuring entity or his duly authorized
representative.
 
For a Change Order or Extra Work Order involving a cumulative
amount exceeding five percent (5%) of the original contract, no work
thereon may be commenced unless said Change Order or Extra Work
Order has been approved by the Secretary or his duly authorized
representative.
F. The Two-Step Processing Procedure
 
The processing of variation orders consists of a two step procedure
wherein a request for prior clearance/authority to issue Variation Order
must first be submitted so that the technical viability of the revisions can
be studied including the legal basis into which it is going to be anchored. If
such clearance is approved (per D.O. 12, S. 2009 & D.O. 04, S. 2012, D.O.
17, 2007), the Variation Order Proper may be given its due course.
 
One of the causes of delay in the approval of proposed Variation
Orders is the non-observance of the “two-step procedure” which prolongs
the process of approval of variation orders since same will be returned to
the implementing office in view of the non compliance to the guidelines
and procedures of the Department.
1. Request for Prior Clearance/Authority to Issue
Variation Order
 
The purpose of the request for prior
clearance/authority to issue Variation Order is to serve as
an “annuncio” to the approving official about the need for
the additional works/variations. The clearance should
however not be taken as an outright approval for the
variation order. As this is considered to be a preliminary
stage of the procedure in the preparation of the variation
order proper, it consists of tentative information as to cost
and contains the technical justification and legal basis to
which reason, the variation order is being proposed.
 
  Prior Clearance References
i. D.O. No. 62, Series 1998 - Prescribing Guidelines for
the Preparation, Processing And Approval Of Variation
Orders And As-staked Plans: “Prior clearance or
authority with complete documentation (i.e.,
justifications, approximate quantities and scope of works)
shall be secured before proceeding with the processing of
requests for variation orders.”

“To facilitate approval of any major changes in a design

and/or plans, the Implementing Office/PMO concerned
shall coordinate with the consultant and representatives
from BOD,BOC and Contractor’s concerned”
ii. Memorandum dated August 25, 2003 of then Acting Secretary,
Florante Soriquez which states that “To provide for more efficient
implementation and management of foreign –assisted projects, you (All
PMO Project Directors and Project Managers) are hereby directed to
secure prior clearance from the Secretary, through the
Undersecretary/Assistant Secretary for Operations concerned before
implementing any Variation Order (Change Order,/Extra Work Order) on
a foreign –assisted contract for civil works /consulting service except for
variation orders within your delegated authority.” – requiring three (3)
basic documents;
a. Memorandum request for clearance/authority to implement V.O. with
justification
b. Project Profile (using the format prescribed for ODA projects
c. Implementation Schedule and Financial Program( using PIO Form
No. 1-2003
ii. D.O. No. 3, Series 2005 – Prior Clearance from the
Secretary before undertaking any work outside the
coverage of the Contract on Civil Works and Consultancy
Service.
a. No works/services shall be commenced covering
variation order/addendum/re-alignment, without first
approved by the Secretary
b. Works undertaken by contractor or services performed
by the consultant without approved Prior Clearance will not
be paid by DPWH and shall be deemed personal liability of
the person who authorized the commencement of the work.
c. DPWH officials responsible shall be liable
administratively.
ii. D.O. No. 17, Series 2007 – Revised Procedure in seeking prior clearance from
the Secretary for Variation Orders on Civil Works and Consultancy Contracts.
a. To be submitted directly to Asec for Operations concerned for review
recommendation, then for Usec Operations recommendation for
Secretary’s Approval.;
b. May be referred to concerned Bureau(s)/Service(s) for further assessment,
validation and/or evaluation;
c. To be referred to Planning if additional funding is required.

iii. D.O. No. 12, series of 2009-Revised Procedures in Seeking Prior Clearance
from the Secretary for Variation Orders on Civil Works and Consultancy
Service Contracts.
a. to be submitted directly to Usec for Operations concerned for review
and recommendation;
b. then to Asec for Planning for assessment and recommendation as to
availability of funds and if warranted, NEDA –ICC.

iv. D.O. No. 4, Series 2012 – Delegating the approval of prior clearance from the
Secretary to issue variation orders of locally funded civil works projects.

Regional Director – To approve Prior Clearance for projects undertaken

by the Regional and District Engineering Offices
b. Checklist of Requirements - the following are the checklist of requirements in the
processing of request for prior clearance/authority to issue Variation Order for projects
in the Central Office, for PMO Foreign Assisted projects. The approval of prior
Clearance for locally funded civil works had been delegated to the Regional Director
per D.O. No. 4, S. 2012.

Executive Summary / This is where the Implementing Office explains the

Memorandum request for need for the variation order which must be
clearance/authority technically and legally justifiable. Likewise, the
Implementing Office must state in the Executive
Summary/Memorandum request for
clearance/authority the approximate cost and scope
of work of the proposed variation order.

Memorandum of the Contains the explanations/justification of the

concerned Project Director Implementing Office relative to the request for prior
requesting prior clearance.
Clearance/Authority with
justification
Pre-investment Clearance Per D.O. No. 68, series of 2005, a pre-investment
clearance from Planning Service is meant to
strengthen the control and monitoring of the cost of
foreign assisted projects vis-avis the approved cost of
the NEDA–ICC.
 
Proposed change of more than the ICC approved
cost should be properly coordinated with the
Planning Service for pre-investment clearance,
subject to the approval of the Secretary.
Project Profile The Project Profile is being required in a format
prescribed for ODA projects to provide information
about the project.
It contains all the necessary information including the
contract cost, contract schedule, contract status,
project updates, issues and concerns and the
corresponding actions being undertaken by the
Implementing Office.
Implementation Schedule The Implementation Schedule/Financial Program is
being required using PIO Form No. 1-2003 to
provide additional information about the project
which will be used in the evaluation of the request
for prior clearance/authority to issue Variation Order.
It contains the following:
 
Bar Chart containing the updated implementation
schedule of the feasibility study, detailed engineering,
pre-construction activities and the civil works
implementation.
Cash Flow Schedule of the project representing the
financial schedule
Copy of Original Contract The copy of Original Contract and previously
Copy of previously approved approved Variation Orders will give information as to
Variation Orders, if any how much contract modifications has already been
effected prior to the requested clearance/authority.
Such contractual data shall be reflected in the
Executive Summary to be submitted for approval of
the Secretary.
c. Procedural Flow – Request for Prior Clearance/Authority to Issue Variation
Order

The following is the procedural flow of documents pertinent to the Request for
Prior Clearance in the DPWH Central Office in accordance with D.O. No. 156, Series
of 2015 – Implementation of the Document Tracking System (DoTs) for Civil Works
Projects.

Activity Office Prescribed Time (wd)

Coordinate, review and IO 7
endorse
Recommend approval USEC for PMO Operations 2
Recommend approval USEC for Technical 2
Services
Approve Secretary 3

Total 14
2. Variation Order Proper (Second Step)
 
Upon approval of the request for prior
clearance/authority, the Variation Order
Proper may now be submitted for processing
and approval if the supporting documents are
ready and complete.
 
 CHECKLIST OF REQUIREMENT AS PER D.O. NO. 156, SERIES OF 2015

VARIATION ORDERS (C.O./E.W.O./FINAL

I. TO BE SUBMITTED BY THE CONTRACTOR

1. Contractor’s Request The Contractor's request is being required as this shows the participatory role of
the Contractor in the proposed changes to the contract.
The request must bear the information of when the need for the variation order was
discovered and the request of the Contractor for an inspection must be conveyed to
confirm such need for variation order.

2. If with additional cost, Additional Performance Bond is required per IRR-A of RA 9184 which states that
Performance Security (duly the contractor shall post an additional performance security in accordance with the
verified by SAC) (If variance following schedule to cover any cumulative increase of more than ten per cent over
on the total amount of the the original value of the contract as a result of amendments due to variation orders.
contract is above 10% for Cash or cashier’s check, manager’s check, bank draft or irrevocable letter of
locally-funded and above credit- 5%
25% or as provided for in the Bank Guarantee-10%
conditions of contract for Surety Bond-30%
foreign Assisted Projects. Foreign government guarantee-100%
The Contractor shall cause the extension of the availability of the Performance
Security to cover proposed contract time extension due to variation order for it
shall be co-terminus with the final completion of the contract
For Variation Orders Without Additional Cost and/or Time Additional
Performance Bond or the extension of the previous Performance Bond is not
required.
CHECKLIST OF REQUIREMENT AS PER D.O. NO. 156, SERIES OF 2015

VARIATION ORDERS (C.O./E.W.O./FINAL

I. TO BE SUBMITTED BY THE CONTRACTOR

3. Latest income tax and To provide proof /evidence that the contractor are paying taxes
business tax returns obligation timely for their income/proceeds of the project, in
duly stamped and compliance to executive order
received by the BIR
duly validated with the
tax payments made
thereon. Tax clearance
from the BIR to prove
full and timely
payments of taxes.

4. Certification under oath To provide proof /evidence that the contractor are paying taxes
stating that the obligation timely for their income/proceeds of the project, in
contractor is free and compliance to executive order
clean of all Tax
Liabilities to the
Government
CHECKLIST OF REQUIREMENT AS PER D.O. NO. 156, SERIES OF 2015

VARIATION ORDERS (C.O./E.W.O./FINAL

I. TO BE SUBMITTED BY THE CONTRACTOR

5. Duly signed/approved plans for the The approved Plans is being used as reference
proposed changes in the review of items of work proposed for
the Variation Order, new unit prices for new
items of work.
It is likewise, referred to in the review of the
proposed time extensions in view of the
additional work to the contract.

6. Design Analysis & Computations for the It contains the analysis of the design and
proposed changes computation of the quantity involve in the
Variation Order as reference by BOD in the
conduct of review

7. Copy of the Complete set of the approved As reference by BOC and BOD in the review
plans (As-Staked, Original, Revised and of the items of work involved in the proposed
As-Built) Variation Order

8. Copy of approved contract including the As reference in determining the legal basis of
GCC, COPA and SCC (for applicable the Variation Order and its particular
clause/s) and previously approved application in its valuation.
variation orders(s) Also to check any duplication or overlapping
of items of work in the previously issued VO.
CHECKLIST OF REQUIREMENT AS PER D.O. NO. 156, SERIES OF 2015

VARIATION ORDERS (C.O./E.W.O./FINAL

I. TO BE SUBMITTED BY THE CONTRACTOR

9. Detailed Quantity Calculations It contains the computation of the quantity of each

item of work involved in the Variation Order

10.Where substitution of original specified To support the legal and technical merit of the
materials is involved, the following substitution of Materials requirement, and the
requirements shall be submitted (if there’s any) appropriateness/reasonableness of the cost
a. Certification on the non-availability of the estimate.
specified materials by 3 leading
Manufacturers or suppliers
b. Technical Specifications of the original
and substitute materials
c. Design computations for the substitute
material
d. Cost Estimate

11.Straight-line Diagram showing the proposed The Straight Line Diagram (color coded) should
works reflect the necessary additional works with due
reference to the original works in the contract.
It is suggested that the additional works be coded
with a different color against that of the original
ones to distinguish how much work is being
incorporated or deleted from the original contract.
CHECKLIST OF REQUIREMENT AS PER D.O. NO. 156, SERIES OF 2015

VARIATION ORDERS (C.O./E.W.O./FINAL

I. TO BE SUBMITTED BY THE CONTRACTOR

12.Derivation of Time Extension for the The derivation of proposed time extension, if
proposed Variation Order (C.O./E.W.O.) there is any, should be based only on the items
of work which is along the critical path of the
previously approved PERT/CPM.
It is advised that to properly represent this
requirement, the contractor be made to submit
a draft revision of the PERT/CPM
incorporating the necessary changes, so that
the effect in the contract with respect to the
works, may be appropriately derived based on
reasoning.
13.Detailed Unit Cost Analysis for new items of As reference in the review of the costing of new
work items of work. The DUPA of original items of
a. Detailed Estimate of items of work work and previously approved Variation
under the original contract or previous Order will be used in the verification if such
approved V.O. figures reflected in the DUPA are the same
b. Canvass Price and/or derivation of figures used in the proposed new unit price in
Materials Cost delivered at site accordance with the contract requirements
c. Construction Methodology (for items
I hereby certify that
of the above which
work supportingare
documents
highlyare complete
technical or
unusual)
Print Name: ____________________________________
Designation: ____________________________________
Date: ____________________________________
CHECKLIST OF REQUIREMENT AS PER D.O. NO. 156, SERIES OF 2015

VARIATION ORDERS (C.O./E.W.O./FINAL

I. TO BE SUBMITTED BY THE CONTRACTOR

14.Copy of Previously approved Time To further check the revised contract duration
Extension (If there’s any) and expiry date.

15.One set certified true copy of all documents For advance information/reference to the
submitted for accounting’s copy. accounting Division

I hereby certify that the above supporting documents are complete

Print Name: ____________________________________

Designation: ____________________________________
Date: ____________________________________
CHECKLIST OF REQUIREMENT AS PER D.O. NO. 156, SERIES OF 2015

VARIATION ORDERS (C.O./E.W.O./FINAL

II. TO BE SUBMITTED BY THE IMPLEMENTING OFFICE

1. Executive Summary The contents in the Executive Summary of

previously approved clearance/authority by the
Secretary has almost the same contents to be
reflected in the Executive Summary of the
Variation Order proper.

2. Detailed Technical Justifications and legal The Project Engineer’s Report is being
basis for the proposed changes (prepared by required in compliance with the provisions of
consultant or implementing office) the IRR-A of RA 9184.
The Project Engineer’s Report therefore, must
be within the above mentioned guidelines which
state that if the Project Engineer finds the
variation order justifiable, he must prepare the
proposed order and submit same to the Director
together with the supporting documents.
CHECKLIST OF REQUIREMENT AS PER D.O. NO. 156, SERIES OF 2015

VARIATION ORDERS (C.O./E.W.O./FINAL

II. TO BE SUBMITTED BY THE IMPLEMENTING OFFICE

3. Comments/recommendations of DPWH The Consultants must convey thru their letter

officials (Regional Director, Project endorsement that they have evaluated the
Directors/Manager) and Project Consultants documents and they are submitting such
concerned documents together with their recommendation.

Head IO to indorse and recommend approval of

the claim as verified and validate at site.

4. Project Engineer’s Report/Consultant The Project Engineer’s Report/Consultant

Resident Engineer Report Engineer’s Report is being required in
compliance with the provisions of the IRR-A of
RA 9184, FIDIC and Condition of Contract.
The Project Engineer’s Report/Consultant
Engineer’s Report therefore, must be within the
above mentioned guidelines which state that if
the Project Engineer/Consultant Engineer finds
the variation order justifiable, he must prepare
the proposed order and submit same to the
Director together with the supporting
documents.
CHECKLIST OF REQUIREMENT AS PER D.O. NO. 156, SERIES OF 2015

VARIATION ORDERS (C.O./E.W.O./FINAL

I. TO BE SUBMITTED BY THE CONTRACTOR

5. Itemized Cost of Revision It contains the detailed cost computation of all the changes in
the amount of the contract including the previous changes
that were approved in Variation Orders, if there is any.
Hence, it must include the Bill of Quantities of the original
contract, the previously approved variation orders and the
proposed work to be undertaken which is being presented on
an additive and subtractive basis to easily distinguish how
much work is being deleted and how much is being
introduced.

The signatory should bear the name of the Project Director

concerned or the Head of Implementing Office who submits
the Itemized Cost of Revision, the Director of the Bureau of
Design, who reviews the computation as to quantity, and the
Director of the Bureau of Construction who reviews the
computation as to unit cost.
I hereby certify that the above supporting documents are complete
If the quantity involve was based from the plans that has
been previously reviewed by the Bureau of Design, the
Print Name: Itemized Costs of Revision need not be coursed thru the
_______________________________
Designation: Bureau of Design in accordance with D.O. NO. 62, series of
_______________________________
Date: 1998-Guidelines for the Preparation, Processing and
_______________________________
Approval of Variation Order and As-stake Plans which states
that:
“
CHECKLIST OF REQUIREMENT AS PER D.O. NO. 156, SERIES OF 2015

VARIATION ORDERS (C.O./E.W.O./FINAL

I. TO BE SUBMITTED BY THE CONTRACTOR

6. Complete Contractual Data with Project The Project Profile with updated status is
Status Report being required as this is going to be reflected
in the Executive Summary hence, the need to
update the status of the project since the
project must have progressed from the time
during the processing of the request for
clearance/authority to issue variation order.
7. Approved Price Adjustment/Escalation (If The Approved Price Adjustment/Escalation, if
there’s any) there is any, is being required to check if same
is correctly reflected in the Itemized Cost of
Revision and in the other documents
comprising the proposed change in the
contract.

8. Obligation Request (ObR/Certificate of The Obligation Request (ObR)/Certification of

Availability of Funds (CAF), (If with Availability of Funds (CAF) is being required
additional cost) to check if there is fund to finance the
I hereby certify that the above supporting documents are complete
additional work.
It must be issued by the Department Budget
Print Name: _______________________________ Officer and the fund being certified must be to
Designation: _______________________________ the least, equal to the amount of the proposed
Date: _______________________________ Variation Order.
No CAF is required if the proposed variation
order is nil or is deductive in nature.
 b. Procedural Flow-the following is the procedural flow of documents in the
processing of Variation Order Proper in the DPWH Central Office based from D.O.
No. 156, series of 2015-Implementation of the Document Tracking System (DoTS)
for Civil Works Projects:
Change Order / Extra Work Order
Activity Office Prescribed Time
(wd)
Coordinate, review and endorse IO 7
Verify Project I.D. Planning Service 1
Review and endorse BOD 5
Review and endorse BOC 2
Issue ObR FMS 2
Recommend Approval ASEC for Technical Services 2
Recommend Approval USEC for Technical Services 2
Approve (including review of the Secretary
Legal Service) 3
Total 24
 Final Variation Order
Activity Office Prescribed Time
(wd)
Coordinate, review and endorse IO 7
Verify Project I.D. Planning Serive 1
Review and endorse BOD 6
Review and endorse BOC 3
Issue ObR CFMS 2
Recommend Approval ASEC for Technical Services 2
Recommend Approval USEC for Technical Services 2
Approve (including review of the Secretary
Legal Service) 3

Total 26
G. Additional/Extra Work Costing
 
The activities in the preparation and approval of variation order include
documentation, preparation of design/construction plan, quantification, valuation and
processing for approval. Valuation of Variation Orders is the act of estimating or setting
the value of the scope of works involved in the variation order. It is the essential
activity in the preparation of the variation order which provide beneficial information
to the owner and the contractor for appropriate consideration. The benefits to the
DPWH is that it will be known how much funds is needed to cover the total cost of a
variation order while the Contractor will know how much additional cash outflows
needed to undertake the works involved in the variation order and to know how much
additional income will be generated from the variation order.
 
The Bureau of Construction is responsible in the review/evaluation and
recommendation as to the reasonableness of the unit cost for items of work involved
and for the correctness/orderliness of the computation of the total amount involved for
all variation order as outlined in the Procedural Work Flow Chart in the processing of
Variation Orders per D.O 62, series of 1998, reiterated and stressed per D.O 242, series
of 2001 and later, D.O. No. 156, series of 2015-Implementation of the Document
Tracking System (DoTS) for Civil Works Projects.
 
 As such, the Bureau of Construction provides check and balance to protect the
DPWH from possible overpriced unit cost of items of work or unjustifiable additional
cost that are to be approved by the authorized approving official.
 
1. Conditions When New Unit Cost is Necessary
 
a. Introduction of New Items of Work-when there are items of work that needs to be
introduced which are not previously included in the original contract.

b. Change in the Design- when there is a change in the actual site condition or
differing soil strata from what are reflected in the original design such that the use
of such information from the plans is already inappropriate. Example: Coco/timber
craneway to structural craneway, stone masonry to gabion slope protection, earth
ditch to lined ditch, pre-cast concrete piles to pre-stressed concrete piles, concrete
piles to spread footing, etc.

c. Reclassification of an Existing Item of Work - when there is a need to re-classify

the items of work in the original contract as a result of the design changes or as a
result of the differing soil type/strata and weather condition as per actual field
condition. Example: Surplus common excavation to surplus rock excavation,
common borrow embankment to granular embankment, 28 days concrete to 7 days
concrete & etc.
d. Change in the Hauling Distance-when the approved source of construction
materials and waste disposal site are changed as directed by the Engineer.

e. Change in Construction Methodology-when there is a change in the actual site

condition necessitating to adopt a construction methodology different from the
assumptions made during the time of bidding. Example: Launching girders by
crane to by using girder launchers, steel cofferdam to clay/sandbagging, ordinary
excavation to excavation with cofferdam, craneway to barging, etc.

f. Crashing of Completion Schedule -when there is a need to crash the project

completion schedule or activity schedule as desired by the Owner.

g. Where There Is Difficulty in Site Condition- when an additional work is needed

for existing item of work whose site condition is quite more difficult compared
with the original scope of work such that the output is slower.
h. Overrun of Quantities Exceeding 125 % from the Original Contract-when the
additional quantities of the items of work exceeded by 25 % of the quantity under
the original contract where the existing unit costs are not anymore appropriate.
Provided that it is clearly stipulated under the Conditions of Contract.
 2. Legal Basis In The Application Of New Unit
Costing
a. Section 2, Annex “E” of RA9184 

ADDITIONAL/EXTRA WORK COSTING

 
2.1. For Variation Orders, the contractor shall be paid for additional work
items whose unit prices shall be derived based on the following:
 
2.1.a) For additional/extra works duly covered by Change Orders
involving work items which are exactly the same or similar to
those in the original contract, the applicable unit prices of work
items original contract shall be used.
 
2.1.b) For additional/extra works duly covered by Extra Work Orders involving
new work items that are not in the original contract, the unit prices of the
new work items shall be based on the direct unit costs used in the original
contract (e.g. ,unit cost of cement, rebars, form lumber, labor rate, equipment
rental, etc.).

All new components of the new work item shall be fixed prices, provided the
same is acceptable to both the Government and the contractor, and provided
further that the direct unit costs of new components shall be based on the
contractor's estimate as validated by the procuring entity concerned via
documented canvass in accordance with existing rules and regulations.

The direct cost of the new work item shall then be combined
with the mark-up factor (i.e., taxes and profit) used by the contractor in his bid
to determine the unit price of the new work item.
b. FIDIC-General Condition Sub-clause 52.1-Valuation of Variations:
“All variations referred to in Clause 51 and any additions to the Contract
Price which are required to be determined in accordance with Clause 52
(for the purposes of this Clause referred to as “varied work”), a) shall be
valued at the rates and prices set out in the Contract if, in the opinion of
the Engineer, the same shall be applicable. b) If the Contract does not
contain any rate or prices applicable to the varied work, the rates and
prices in the Contract shall be used as the basis for valuation so far as
may be reasonable, c) failing which, after due consultation by the
Engineer with the Employer and the Contractor, suitable rates or prices
shall be agreed upon between the Engineer and the Contractor. d) In the
event of disagreement, the Engineer shall fix such rates or prices as are,
in his opinion, appropriate and shall notify the Contractor accordingly,
with a copy to the Employer. e)Until such time as rates or prices are
agreed or fixed, the Engineer shall determine provisional rates or prices
to enable on-account payments to be included in certificates issued in
accordance with Clause 60.”
c. FIDIC-General Conditions Sub-clause 52.2 – Power of the Engineer To
Fix Rates “ Provided that if the nature or amount of any varied work
relative to the nature of amount of the whole of the Works or to any part
thereof, is such that, in the opinion of the Engineer, the rate or price
contained in the Contract for any item of the Works is, by reason of such
varied work, rendered inappropriate or inapplicable, then, after due
consultation by the Engineer with the Employer and the Contractor, a
suitable rate or price shall be agreed upon between the Engineer and the
Contractor. In the event of disagreement, the Engineer shall fix such
other rate or price as is, in his opinion, appropriate and shall notify the
Contractor accordingly, with a copy to the Employer. Until such time as
rates or prices are agreed or fixed, the Engineer shall determine
provisional rates or prices to enable on-account payments to be included
in certificates issued in accordance with Clause 60.”
3. Checklist of Supporting Documents (For New Unit Costing)
 
a. Request of the Implementing Office to BOC for review and evaluation of the New Unit
Cost.
b. Evaluation and Recommendations of the Implementing Office and the Consultant.
c. Request of the Contractor to the Consultant or Implementing Office for the approval of
the New Unit Cost
d. Original copy of the detailed unit price analysis of the Contractor together with the
following supporting documents;
i. Derivation of the number of days for equipment and manpower
ii. Quantity calculation of the component materials
iii. Proposed Construction Methodology (for items of work which are highly
technical or unusual)
e. Copy of the approved design plans
f. Copy of the Detailed Estimate of Items of Work under the Original Contract with
component materials used and equipment utilized similar to the proposed new items of
work.
g. Contract Agreement to check what guidelines will be adopted for the costing of New
Items of Work (RA 9184, FIDIC)
h. Canvass Price of Construction Materials ( at least 3 suppliers)
i. Sketch Drawing showing the location of the old and new materials sources and disposal
sites indicating their hauling distance.
j. Matrix of quantities of items of work showing the original quantity and the revised
quantity and their overruns in figure and in percent.
k. Location plan, cross section drawing & photograph (for difficult site condition).
l. Additional justification, if necessary.
4. Procedural Flow-Review of New Unit Cost
 
The Implementing Office shall request from the Bureau of Construction the
review of proposed unit prices supported with the supporting documents and the BOC
shall reply with the proper review thru a memorandum to the Implementing Office.

Work Flow for the Review of New Unit

Cost Contractor

Consultant

Implementing Office
Return
to
Implementing Office BOC
BOD

Legal Service
U/Sec. In-charge of BOC
U/Sec In-charge for Operation
Chief of Staff
Secretary
H. Problems Encountered in the Processing of Variation Orders
 
i. After Approval of the Authority, Another Authority Was Required Because of
the New Costing - This may be the result of inadvertent error in the cost
calculation or the additional scope of work or adjustment in new unit costs that
was incorporated during the finalization of the variation order. Whatever the cause,
this may be avoided by providing a more realistic estimate of the cost in the
request for Prior Clearance/authority to Issue Variation Order. A new authority is
no longer required after the approval of the previous authority. The new costs
could be reflected in the Variation Order proper since it was already established
that there was a need to undertake the proposed variation order. The Implementing
Office however have to explain in writing why there is additional cost to the
amount mentioned in the approved request for prior clearance/authority to issue
Variation Order.

ii. Lengthy Negotiations With the Contractor on the New Unit Price - Another
problem is that there will be lengthy negotiations with the Contractor on the new
unit price if he refuses to accept the review done by BOC hence, the request for
reconsideration which will only delay the approval of the variation order.
iii. Insufficient Certification of Availability of Funds - There are times that only
part of the proposed amount of variation order is being certified to be available by
the Department Budget Officer and the rest is being certified by the Planning
Service to be included in the next infrastructure program. This is not allowable as
it is clear that the funds should be available for the purpose before the variation
order is approved. There are times also that the variation order amount is a little bit
more than what is certified by the Department Budget Officer. This happens when
during the estimating of the costs, there were some inadvertent error committed
which lead to the insufficient amount of the CAF.

iv. Insufficient Performance Security- just like the CAF, there are times when the
amount specified in the Performance Security is not enough for the amount of the
additional cost of the variation order. The reason may be pointed to the fact that the
previous amount was the basis in the issuance of Performance Security but then,
cost recalculations may have resulted to the insufficiency due to things that were
not considered before. Likewise, the validity of the Performance Security is
sometimes found to be deficient as to coverage specially if there is a contract
extension due to the variation order. The Bondsman should express that he does
not in any way, object to the extension of the validity of the Performance Security
up to the date of the project completion which was extended due to the time
extension of the variation order. Further, Performance Security should be validated
and certified by the Special Action Committee.
v. Variation Order Not in the Standard Format- At times, the Itemized Cost of
Revision does not contain the contents of the previously approved variation orders or
does not contain the correct signatories. There are variation order documents that are
submitted not within the accepted format in the department.

vi. Invalid Justification - There are justifications submitted for the request for prior
clearance/authority to Issue Variation Order that is considered invalid as it lacks the
technical and legal basis to back up the said request. - For example a justification
being given that the congressman is requesting for the additional work to be done to
the project even if the work is not within the original scope of work of the contract.

vii. Incomplete Documentary Requirements per DoTS – Submitted request for

approval of Variation Order sometimes is incomplete of supporting documents, thus
delaying its processing and approval and usually returned to the imp[lamenting office
for compliance.
 
I. Tips on How the Processing of Variation Order may be Facilitated
 
i. Submit the Complete Requirements in the Checklist -A complete document tends
to show diligent people are involve in its preparation. If the checklists cannot be
complete, a simple explanation will be acceptable, if found reasonable.

ii. Ensure the Proposed Variation Order is in Compliance With the Contract
Documents, Other Guidelines and Laws of Infrastructure Implementation
-There are complete documents submitted but clarification is still needed since it
cannot establish compliance with the rules and regulations. Although there is an
established checklist, BOC cannot be faulted for returning documents with unclear
presentations.

iii. During Processing of Request for Clearance/Authority, There Are Parallel Activities That
May Be Pursued in Advance. Example: Processing of Plans and Drawing and Review of New
Unit Price of Items of Work -The Consultants and the Implementing Office need not wait for the
approval of the requests for prior clearance/authority before submitting the whole of the
documents which is expected to also take time for the evaluators to review.
iv. During Emergency Situation, the Two Step Procedure May Be Waived and
Instead, a Simultaneous Approval May Be Requested -There are times during
emergency situation that the project has already been visited by several higher
authorities of the Department and the need has already been physically verified
and established. In this instant case, the two step procedure may be waived and
instead, a simultaneous approval may be requested.

v. Make the Initiative of Coordinating in Advance With the Reviewing Offices -

Documents need only the coordinating effort between the Implementing and
Reviewing Offices so that minor details that need to be ironed out can be
undertaken at the earliest time possible. Simple explanations may sometimes avoid
the return of documents which will only delay its processing.
5. Common Lacking Documents
 
a. Construction Plans / Shop Drawing
b. Copy of Detailed Estimates under the Original Contract
c. Conditions of Contract as basis for costing
d. Construction Methodology (for new item not in the blue book or change in
methodology)
e. Detailed breakdown (only lump sum is submitted)
f. Canvass Price – in the Provinces
g. Hauling Distance of Materials (Source)
h. Quantity calculation of component materials
 
6. Common Observation
 
i. Excess Manpower & Equipment Hours.
j. Incorrect Mark-up percentage
k. High Price of Construction Materials
l. Incorrect preparation/presentation (i.e.: lacking necessary equipment or
unnecessary equipment included)
m. Rates applied not in accordance with the guidelines under the Conditions of
Contract.
n. Unrealistic cost of miscellaneous materials items & cost of minor tools.
STANDARD FORMS USED IN VARIATION
ORDER
 VARIATION ORDER
Republic of the Philippines
Department of Public works and Highways
Implementing Office

PROPOSED VARIATION ORDER NO. ____

Project/Location :

To : Name of Contra ctor

You are hereby directed to make herein described changes from the plans and specifications of the following described work not included in the plans and specifications:

DESCRIPTION OF WORK TO BE DONE :

REASON FOR CHANGE : Please see attached Tabulation of Quantities

CHANGE REQUESTED BY :
(Work to be performed at agreed price.)

ITEMIZED QUANTITIES AND COST OF REVISION IS SHOWN ON THE ATTACHED BILL OF QUANTITIES AND COST ESTIMATE

We the undersigned Contractors have given careful consideration to the change proposed Difference in Cost due to this Change : PhP (+) or (-)
and hereby agree, if this proposal is approved that we will provide all equipment, furnish all Net Cost of Previous Change :
materials except as maybe otherwise be noted and perform all services necessary for work Total Cost of Change :
above specified and will accept as full payment thereto the prices shown on the second Original Contract Amount : PhP
page of the attached sheet. Estimated Revised Contract Amount : PhP
Percentage Change in Original Contract Value (+) or (-) :

DATE : SUBMITTED: CHECKED: RECOMMENDING APPROVAL:

CONTRACTOR :

Project Engineer Chief Construction Sect./ Asst. District Engineer/

DPWH Chief Construction Div./ Asst. Regional Director/
Project Manager/ Undersecretary
BY : Project Director/
Name of Contractor
APPROVAL:

District Engineer/
NOTE: This Variation Order is not effective until approved. Regional Director
Undersecretary
Secretary
 ITEMIZED COST OF REVISION
(Proposed Variation Order No. __)
Project : ______________________
Location : ______________________
Contractor : ______________________

PROPOSED V.O. # ___

REVISED QUANTITY
Original Contract
Unit Cost ADDITIVE DEDUCTIVE AND AMOUNT
Item No. Description Unit
Amount Amount Amount Amount
Quantity Quantity Quantity Quantity
(Php) (Php) (Php) (Php) (Php)
                       
                       
                       
                     
                       
                       
                       
                       
                       
                       
  TOTAL AMOUNT                    

Submitted by: Verified as to Quantiites: Verified as to Unit Cost

Project Engineer Chief, Planning & Design Section/ Chief, Construction Section

DPWH Chief, Planning & Design Division/ Chief, Construction Division

Director, Bureau of Design Director, Bureau of Construction

Conforme:  
Contractor
LEVELS OF AUTHORITY
 LEVELS OF AUTHORITY
D.O. No. 54, Series of 2011 – Revised Limits of Responsibilities and
Authorities of Concerned DPWH Offices and Official in the Conduct of
Pre-Procurement, Procurement, and Implementation Activities for DPWH
Locally – Funded Civil Works Projects.

District Office Regional Office Central Office

• Approval of Variation • Approval of Variation Order (VO) of Review/Recommendation for Approval
Order (VO) of projects projects costing greater than to (BOD/BOC)
costing up to P20M P20M to P50M (Regional Director)
VARIATION ORDER

(District Engineer) • Approval of Variation Order for projects

costing above P50M up to P150M
(Undersecretary for Technical Services)

• Approval of Variation Order for projects

costing above P150 (Secretary)
LEVELS OF AUTHORITY
D.O. No. 95, Series of 2013 – Reissuance of D.O. No. 9, Series of 2011
RE: Conduct of Pre-Procurement, Procurement, and Implementation
Activities for DPWH Foreign Assisted Civil Works Projects.

UPMO CENTRAL OFFICE

Prepare Variation Order (in accordance with Review/Recommendation Approval of
prescribed guidelines of the NEDA) Variation Order (Director, BOD/BOC)
Recommend Approval of Variation Order
not to exceed 10%of contract cost
(Undersecretary for Technical Services)
Approve Variation Order (Secretary)
REFERENCES FOR VARIATION ORDER
REFERENCES FOR VARIATION ORDER
Department Order No.
Revised IRR of R.A 9184
Department Order No. 66, Series of 2017
Department Order No. 192, Series of 2017
Department Order No. 68, Series 2016
Department Order No. 156, Series of 2015
Department Order No. 28, Series of 2015
Department Order No. 95, Series of 2013
Department Order No. 47, Series of 2012
Department Order No. 04, Series of 2012
Department Order No. 54, Series of 2011
Conditions of Contract
Federation International Des Ingenieurs-Conseils (FIDIC)
Loan Agreement from the lending institution
Exchange Notes
REFERENCES FOR VARIATION ORDER

1. D.O. No. 66, Series of 2017 – Conditions as to when “As-Built”

Plan can be used as a Reason for Final Variation Order

2. D.O. No. 192, Series of 2017 – Delegating to Undersecretaries the

approval/Signing of Documents Pertaining to Procurement and
Contract Management

3. D.O. No. 68, Series of 2016 – Road Construction Cost Estimation

Manual
REFERENCES FOR VARIATION ORDER
4. D.O. NO. 156, Series of 2015 – Implementation of the Document
Tracking System (DoTS) for Civil Works Projects
- Checklist –
a) Variation Order
b) Pre – Clearance
c) Prescribed Time for Prior Clearance
d) Prescribed Time for Change Order/ Extra Work Order
e) Prescribed Time for Final Variation Order

5. D.O. No. 47, Series of 2012 – Authority to Approved Variation Order

Covering Additional scope of Works Utilizing Savings for Locally –
Funded Projects.

6. D.O. No. 04, Series of 2012 – Delegating the Approval of Prior

Clearance from the Secretary to issue Variation Orders of Locally –
Funded Civil Works Projects
D.O. 47, S. 2012 SUBJECT: AUTHORITY TO APPROVE
VARIATION ORDER COVERING
ADDITIONAL SCOPE OF WORKS UTILIZING
SAVINGS FOR LOCALLY-FUNDED PROJECTS

In order to accelerate the implementation of DPWH locally-funded projects, the

approval of Variation Order (VO) covering additional scope of works utilizing project
savings is hereby delegated to the Regional Director for projects costing above P 50
million but not more than P 150 million. For projects costing over P 150 million, the
approval of said VO is delegated to the Undersecretary for Technical Services.

Additional scope of works refers to works outside but contiguous to the original project
limits. The approval of VO covering addition/deletion of works within the original
project limits and the additional scope of works shall still be in accordance with
Department Order No. 54, series of 2011. The cumulative amount of the positive or
additive VO shall not exceed ten percent (10%) of the original contract price pursuant
to the Implementing Rules and Regulations of R.A. No. 9184.

This Order amends pertinent provisions of Department Order No. 54, series of
2011 and shall take effect immediately.
DEPARTMENT ORDER 04,
Series of 2012
SUBJECT : DELEGATING THE APPROVAL OF
PRIOR CLEARANCE FROM THE
SECRETARY TO ISSUE VARIATION
ORDERS OF LOCALLY-FUNDED
CIVIL
WORKS PROJECTS

In line with our continuing effort to simplify operating procedures and expedite the
implementation of projects, approval of requests for prior clearance from the Secretary
to issue Variation Orders on locally-funded Civil Works projects undertaken by
Regional and District Engineering Offices, is hereby delegated to Regional Directors.

It is understood, however, that Variation Orders shall still be processed and approved
following existing procedures and prescribed levels of authorities. Likewise, pursuant to
the Implementing Rules and Regulations of R.A. No. 9184, the cumulative amount of
the positive or additive Variation Order shall not exceed ten percent (10%) of the
original contract price.

This Order amends pertinent provisions of D.O. No. 12, series of 2009, and takeseffect
immediately.
D.O. 28, Series of 2015 – SPECIFIC GUIDELINES TO MANAGE AND
CONTROL VARIATION ORDERS FOR DPWH INFRASTRUCTURE
CONTRACTS
To reduce the incidence and improve the management of Variation Orders (VOs) for
infrastructure contracts undertaken by the DPWH, all concerned are hereby directed
to observe the following guidelines in relation to the provisions of Annex E
(Contract Implementation Guidelines for the Procurement of Infrastructure Projects)
of the Implementing Rules and Regulations(IRR) of Republic Act (RA) No. 9184:

a. Detailed Engineering must be adequately undertaken according to

established standards for surveys and designs with a degree of accuracy
that will permit estimates of quantities to be within plus or minus five
to ten percent (5-10%) of the final quantities.

b. Before procurement, the Implementing Office (IO) shall ensure that the
detailed engineering plans for the contract, especially if prepared more
than one year ago, are properly updated to reflect current physical
conditions.
D.O. 28, Series of 2015 – SPECIFIC GUIDELINES TO MANAGE AND
CONTROL VARIATION ORDERS FOR DPWH INFRASTRUCTURE
CONTRACTS
c. Upon the issuance by the DPWH of the Notice to Proceed (NTP) for a
contract, the Implementing Office shall provide the contractor an
electronic/soft copy of the approved plans for the project to facilitate the
preparation by the contractor of as-staked plans. Any disparity between
the as-staked plans and the approved plans may serve as the basis for
the initial VO.

d. Pursuant to the provisions of Section 1.1, Annex E of RA9184-IRR, a

deductive VO may be allowed only if it would not significantly impair
the functionality of the original design, i.e., it must not reduce the size
of the facility by more than ten percent (10%) of the original scope (e.g.
shortening of road length) or must not make the facility unsafe (e.g.,
removal of guard rails) or structurally unstable (e.g., removal of a
column) or unusable (e.g., removal of an abutment).
D.O. 28, Series of 2015 – SPECIFIC GUIDELINES TO MANAGE AND
CONTROL VARIATION ORDERS FOR DPWH INFRASTRUCTURE
CONTRACTS
e. Pursuant to the provisions of Section 1.5, Annex E of RA9184-IRR, the 10
shall see to it that, within seven (7) calendar days after emergency work
under a proposed VO has commenced, or within twenty eight (28)
calendar days after the circumstances for an extra cost have occurred,
the contractor must deliver a notice for the claim of a VO so that the IO
may investigate and process the VO if justifiable. Failure by the
contractor to deliver such notice on time shall constitute a waiver by the
contractor for any claim. The IO shall not allow the contractor to
"accumulate" claims for VOs before submitting them to the IO for
investigation and processing.

f. The processing by the IO of VOs from its preparation to approval shall

not exceed thirty (30) calendar days.
D.O. 28, Series of 2015 – SPECIFIC GUIDELINES TO MANAGE AND
CONTROL VARIATION ORDERS FOR DPWH INFRASTRUCTURE
CONTRACTS

Failure of the concerned DPWH personnel to implement the provisions of

this Order shall, after due process, make them liable to the penalties
prescribed for violation of reasonable office rules and regulations in
Section 52, C(3) of Civil Service Resolution No. 991936 dated August 31,
1999, otherwise known as the Uniform Rules on Administrative Cases in
the Civil Service - i.e.: 1st offense - Reprimand; 2nd offense -
Suspension for 1-30 days; and 3rd offense - Dismissal.
DPWH Standards Specifications 1988, Volume 1 – Prospective
Bidders Responsibility

Item 10 – It shall be the sole responsibility of the prospective Bidder to

determine and to satisfy himself by such means as he considers
necessary or desirable as to all matters pertaining to the project,
including the location and the nature of work; climatic conditions;
geological conditions at the site; transportation and
communication facilities; the requirement and the availability of
materials, labor, water, electric power and roads; the location and
extent of aggregate sources; and other factors that may affect the
cost, duration and execution of work. The prospective Bidder by
the act of submitting his Bid acknowledges that he has inspected
the site and determined the general characteristics of the project
and the conditions stated above.

The Government shall not assume any responsibility regarding

erroneous interpretations or conclusions by the prospective Bidder
out of the data furnished by the Government.
 Under the 1999 FIDIC, Clause 13 – Variations and
Adjustments Sub-Clause 13.1-Right to Vary, it states that, “
Variations may be initiated by the Engineer at any time prior to
the issuing of the Taking-over Certificate for the Works, either
by an instruction or by a request for the Contractor to submit a
proposal.

The Contractor shall, execute and be bounded by each

Variation, unless the Contractor promptly gives notice to the
Engineer stating (with supporting particulars) that the
Contractor cannot readily obtain the Goods required for the
Variation. Upon receiving this notice, the Engineer shall
cancel, conform or vary the instruction.
 
 Each Variation may include the following:
 
1. Changes to the quantities of any item of work included in the
Contract
2. Changes to the quality and other characteristics of any item of
work
3. Changes to the levels, positions and /or dimensions of any part
of the works
4. Omissions of any work unless it is to be carried out by others
5. Any additional work, Plant, Materials or services necessary for
the Permanent Works, including any associated Tests on
Completion, boreholes and other testing and exploratory
works, or
6. Changes to the sequence or timing of the execution of the
Works.”

NOTE: The contractor shall not make any alteration and/or

modification of the permanent works, unless and until the
 Under the 1999 FIDIC, Clause 12 – Measurement
and Evaluation Sub-Clause 13.3-Evaluation, it states
that, “ Except as otherwise stated in the contract, the
Engineer shall proceed in accordance with Sub-
Clause 3.5(Determination) to agree or determine the
contract price by evaluating each item of work,
applying the measurement agreed or determined in
accordance with the above Sub-Clause 12.1 and 12.2
and the appropriate rate or price for the item.
For each item of work, the appropriate rate or price for the item shall be the
rate or price specified for such item in the contract or, if there is no such
item, specified for similar work. However, a new rate or price shall be
appropriate for an item of work if:

a) (i) the measured quantity of the item is changed by more than 10% from
the quantity of this item in the bill of quantities or other schedule;
(ii) the change in quantity multiplied by such specified rate for this
item exceeds 0.01% of the accepted contract amount;
(iii) this change in quantity directly changes the cost per unit quantity of
this item by more than 1%; and
(iv) this item is not specified in the contract as fixed price.
or
b) (i) the work is instructed under Clause 13 (Variations and Adjustments);
(ii) no rate or price is specified in the Contract for this item; and
(iii) no specified rate or price is appropriate because the item of work is
not of similar character, or is not executed under similar conditions, as any
item in the contract.
Each new rate or price shall be derived from any relevant rates
or prices in the Contract, with reasonable adjustments to take
account of the matters described in sub-paragraph q) and/or
(b), as applicable. If no rates or prices are relevant for the
derivation of a new rate or price, it shall be derived from the
reasonable Cost of executing the work, together with
reasonable profit, taking account of any other relevant matters.

Until such time as an appropriate rate or price is agreed or

determined, the Engineer shall determined a provisional rate or
price for the purposes of Interim Payment Certificates.
THANK YOU