Why do contractors charge for change orders?

Contractors charge for change orders because they represent additional work, materials, and time beyond the original contract scope, and they disrupt the planned workflow and scheduling that was priced into the initial quote.

Change orders are essentially mini-contracts for work that wasn't included in your original agreement. When you signed your initial contract, the contractor calculated their pricing based on specific materials, labor hours, timeline, and workflow. Any deviation from this plan creates additional costs that weren't accounted for in the original price.

Material costs and procurement represent a significant factor in change order pricing. If you decide mid-project to upgrade from standard drywall to moisture-resistant drywall in your bathroom renovation, the contractor must source different materials, often paying rush pricing since they weren't ordered with the original bulk purchase. In Toronto's current market, material price fluctuations can be dramatic - lumber prices alone have varied by 40-60% over recent months.

Labor disruption and scheduling impacts often make change orders more expensive per square foot than if the work had been included originally. When a contractor's crew is set up to install hardwood flooring and you suddenly want tile instead, they may need to bring in different trades, rent different tools, or completely reorganize their workflow. This inefficiency gets reflected in the pricing. A typical Toronto renovation contractor might charge 15-25% more for change order work compared to the same work priced in the original contract.

Administrative and permit considerations also drive costs. In Toronto, certain changes require permit amendments through the City of Toronto Building Division, adding both time and fees. If your kitchen renovation change order involves moving plumbing or electrical, the contractor must coordinate with ESA (Electrical Safety Authority) or arrange for additional inspections, creating project delays and administrative burden.

Risk management plays a crucial role in change order pricing. Contractors build contingencies into change orders because scope creep often reveals unexpected issues. When you decide to remove a wall during renovation, there's always risk of discovering knob-and-tube wiring, asbestos, or structural complications that weren't visible during the original assessment.

Professional guidance suggests discussing potential changes early and getting written estimates before proceeding. Reputable contractors should explain their change order policy upfront and provide detailed breakdowns of additional costs. In the GTA market, expect change orders to be priced 20-30% higher than equivalent work would cost if included in the original scope.

Next steps include reviewing your contract's change order clause, maintaining detailed communication about any desired changes, and budgeting an additional 10-20% contingency for typical residential projects in Toronto. Always get change orders in writing before work begins, and understand that while they cost more, they're often necessary to achieve your desired outcome.