More and less work: how to avoid conflicts between contractor and client?

Additional and less work is one of the biggest points of contention between contractors and clients and a common cause of legal proceedings. But what exactly is extra work, how is it legally regulated and what are you entitled to as contractor and client?

What exactly is contract extras and contract reductions?

Additional work can be described as anything that a contractor does more than the contract provides for. It is an extra performance, not explicitly agreed upon, for which the contractor is entitled to an (additional) payment. In practice, this amounts to additional payment in addition to the agreed contract price.

Less work, on the other hand, is doing less than follows from the job description. For example, because part of the contract is cancelled, completed in a different way or because the work is done by someone other than the contractor. The client then owes the contractor a lower fee than agreed for that part of the work.

The principles of additional and less work

Additional work is regulated in Article 7:755 of the Dutch Civil Code. The basic principle in the case of additional work, is that the contractor can only claim an increase in the price if he has informed the client in good time of the necessity of a resulting price increase, unless the client should have understood that necessity by himself. Thus, to be safe, a contractor should alert the client as soon as additional work is involved. But, the more knowledgeable the client is, the sooner he will be attributed understanding of the price increase associated with the additional work.

Previously, the Supreme Court ruled that the principal had to be aware of the necessity and amount of a price increase. In 2022, this changed. If the client understands or should understand that additional work is coming, he must contact the contractor about the additional cost. If he does not, the contractor can raise the price. However, the increase must be reasonable. This rule gives the contractor a stronger position on extra work.

There is no clear legislation for less work, as there is for extra work. Usually the contractor will return the cost of the lesser work to himself if he agrees. In
other cases, the contractor may consider it a partial cancellation of the work. As a result, the client must pay the full price, minus the savings on the work
that was not performed. So it is essential to make clear agreements about less work to avoid discussions afterwards.

Additional and less work under UAV

The Uniform Administrative Conditions 2012 (UAV) have a much more exhaustive regulation for more and less work than the standard provision in the law discussed above. The main deviation is that a regulation is also included with regard to less work. This also includes an extensive enumeration of what more or less work can result from.

The UAV also regulates the financial settlement of contract extras. The additional work is expressed by means of an additional payment, while for the reduced work a discount is applied to the contract price. The parties must agree how this will be settled/paid. If the parties do not agree on anything, the additional work will be settled in one lump sum after completion of the additional work. For the less work, this will be settled in the final settlement of the work, as a discount on the contract price. In practice, it is usually agreed that a balance is kept on the additional and less work, which is settled at the end of the work. If there is a lot of additional work, this is also done during the construction of the work.

Another important deviation under the UAV is that if the reduced work exceeds the additional work, the contractor is entitled to a lump-sum fee; this fee is 10% on the balance that the reduced work exceeds the additional work. A lump-sum compensation is a fixed amount fixed in advance, regardless of actual costs or expenses.

Questions?

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