Contract Variation Letter

What is a Contract Variation Letter?

A contract variation letter is a formal document that requests or confirms changes to an existing construction contract's original scope, specifications, timeline, or cost. These variation letters serve as legal documentation that modifies the agreed-upon terms between project owners, contractors, and other stakeholders.

Variation letters in construction establish a clear paper trail for all project modifications, ensuring transparency and accountability throughout the construction process. The letter of variation becomes part of the contract documentation, helping prevent misunderstandings or disputes later in the project life cycle.

What's Included in a Contract Variation Letter Template

A comprehensive letter of variation includes several essential components that ensure complete documentation of proposed changes. The template comprises project identification details such as contract number, project name, and relevant dates to establish a clear context.

A professional contract variation letter template typically includes:

• Project details: Contract title, reference number, site address, and date of issue.
• Recipient and sender information: The parties involved, such as Principal, Superintendent, or Contractor.
• Reference to contract clause: For example, Clause 36 of AS4000, Clause 13 under JCT, or the relevant provision in NEC4 outlining variation procedures.
• Description of varied works: A concise summary of what’s being changed, such as additional works, omissions, or substitutions.
• Reason for variation: Common reasons include design development, latent site conditions, client instructions, or statutory changes.
• Impact on Contract Sum: The value of the variation, including quotations, daywork rates, or cost adjustments.
• Impact on Programme: Any required Extension of Time (EOT) and updated completion date, supported by a Time Impact Assessment if applicable.
• Supporting documentation: References to construction drawings, specifications, BOQ items, or site records that substantiate the variation.
• Approval section: Space for signatures or acknowledgment from the Superintendent, Contract Administrator, or Project Manager confirming agreement.

💡 Pro Tip: Always attach relevant documents, like the contractor’s quotation, updated drawings, or minutes of meeting, to support the variation’s cost and time implications. Comprehensive records strengthen claims and simplify Superintendent certification.

Why Use a Template for a Contract Variation Letter?

Using a variation letter template standardises how construction variations are documented, approved, and tracked across a project. It helps project managers, contractors, and clients maintain clarity when managing scope, cost, or time adjustments under formal contract conditions.

A ready-to-use template is valuable because it:

• Ensures compliance: Helps meet the notice and documentation requirements set out in AS4000, JCT, NEC, or other contract forms.
• Saves time: Eliminates the need to draft letters from scratch for every variation, allowing teams to focus on valuation and assessment.
• Improves consistency: Keeps variation notices, directions, and approvals uniform across all correspondence and project stages.
• Reduces disputes: Provides a clear paper trail of what was varied, when, why, and at whose instruction, minimising ambiguity during final account or payment claim stages.
• Supports financial control: Tracks cumulative adjustments to the contract sum and ensures costs are properly authorised before work proceeds.
• Enhances transparency: Keeps all parties aligned on approved changes and their effects on programme and payment certificates.
• Simplifies audit and reporting: Structured templates make it easier for quantity surveyors and project managers to reconcile variation records and report to clients or auditors.

Construction variation letter templates also help teams respond quickly to variation requests or instructions, ensuring notices are issued within contract timeframes and comply with statutory obligations such as the Security of Payment Act.

How to Create a Contract Variation Letter in Mastt

Creating a contract variation letter in Mastt is simple and quick. You don’t need to format documents or copy details between spreadsheets and Word files. Mastt Cost Module pulls everything straight from your live contract, so your variations stay linked to budgets, approvals, and reports automatically.

Here’s what you can do in Mastt:

📋 Generate professional variation letters instantly with all key project details filled in.

🔗 Connect each variation to the right contract and budget for full visibility.

🧾 Add cost, scope, and time impacts for accurate reporting and assessments.

📤 Download your variation letter as a PDF ready to issue or file for recordkeeping.

Creating a contract variation letter takes only a few steps:

1. Open the Cost Module: Go to your project in Mastt and select Cost Module from the top navigation. Click Variations to open your Variations Register.
2. Add a New Variation: Select + Add → Variation. Enter a clear title, choose the related contract, and describe the proposed variation, including its reason and type (e.g., instructed variation, client request, or design change).
3. Record Scope, Value, and Time Impact: Under the Contracts section, input cost and EOT data. You can upload supporting documentation such as drawings, quotations, or site instructions to strengthen the variation record.
4. Review and Save: Go to the Descriptions tab to preview Mastt’s pre-filled text, which automatically includes approval and recommendation notes. Edit or override the text if needed, then click Add to save.
5. Download the Contract Variation Letter: Return to the Variations Register, click the three-dot menu beside your saved variation, and select Variation Approval Letter or Variation Order Letter to export your formatted PDF.

💡 Pro Tip: Keep all your variations in Mastt instead of managing multiple Word files. It makes it easier to track approvals, stay compliant, and always have your most recent letter ready when you need it.

Who Should Use a Letter of Variation Template?

A contract variation letter template is essential for anyone responsible for administering or managing construction contracts. It provides a clear, compliant format for issuing or responding to variations.

Professionals who benefit most from using a variation letter template include:

✅ Project Owners: Ensuring variations align with project objectives, approved budgets, and funding constraints.

✅ Project Managers: Leading overall coordination of variations, from initiation through assessment and approval.

✅ Contract Administrators: Managing formal notifications, Superintendent’s Directions, and documentation under AS4000, JCT, or NEC contracts.

✅ Contractors and Subcontractors: To notify the Principal or Superintendent of any required changes, submit quotations, or seek approval for variations to the Works.

✅ Construction Managers: Overseeing site-based variations and coordinating implementation with subcontractors and trades.

✅ Client Representatives: Liaising with internal stakeholders to secure approvals and report on variation cost and time impacts.

✅ Design Team Leaders: Issuing or responding to design-related variations triggered by drawing revisions, specification changes, or client requests.

✅  Risk Managers: Recording variation impacts within the project’s risk register and updating mitigation strategies.

✅ Legal Advisors: Reviewing variation correspondence to ensure compliance with contract clauses and Security of Payment requirements.

✅ Quality Managers: Managing variations resulting from nonconformance reports, quality rework, or revised inspection criteria.

Designate a single point of contact for delay notifications to ensure consistency in messaging and prevent conflicting communications to the same stakeholder. This person should have the authority to make decisions about delay mitigation strategies and access to real-time project information.

When to Use a Variation Letter in Construction

A contract variation letter template is most effective when a change to the agreed-upon contract scope, value, or timeline needs to be formally documented.

You’ll want to use a variation letter during:

• Design updates: Used when new drawings, specifications, or design amendments alter the original scope of works.
• Unforeseen site conditions arise: Applied when latent conditions, hidden services, or regulatory updates require additional work or design modifications.
• Client requests: Sent when the principal or client instructs variations such as scope additions or upgraded materials.
• Omissions or substitutions: Issued when parts of the work are removed or replaced as part of value engineering or scope realignment.
• Programme delays: Required when variations affect the programme and an EOT or delay cost claim needs to be lodged.
• Valuation or approval: Used when submitting a variation for review, certification, or payment approval.
• Cost Adjustments: Needed when provisional sums, dayworks, or prime cost items are reconciled and included in the variation account.

💡Pro Tip: Always issue variation letters before carrying out the changed work. Early notification ensures compliance with contract timeframes and strengthens your position when submitting progress claims or payment certificates.

Common Problems with Free Contract Variation Letters in Word or Docs

Free downloadable variation letter templates can be useful for quick communication, but they often lack the detail needed for proper contract administration and compliance. When used without structure or context, these templates can lead to inconsistencies in variation records.

Common challenges include:

⚠️ Missing contract references: Many variation letter templates in Word don’t include fields for referencing relevant clauses or variation instructions.

⚠️ Incomplete project details: Free contract variation letters in Word or Docs often leave out essential information like contract number, project title, Superintendent details, or variation category.

⚠️ Unclear variation descriptions: Generic templates make it difficult to describe the varied works, especially when the change involves specific site conditions, design amendments, or client-directed variations.

⚠️ No supporting attachments: Many free template downloads lack sections for attaching drawings, quotations, or valuation breakdowns.

⚠️ Poor formatting and tracking: Managing multiple variation letter templates in Excel can lead to errors when manually tracking changes to scope, value, or EOT.

⚠️ Lack of approval fields: Many free downloadable templates in Word or PDF don’t include signature lines or approval sections for the Superintendent, Principal, or Project Manager, making the variation unenforceable.

💡 Pro Tip: If you must use a free variation letter template, customise it to match your contract clauses and include fields for valuation, EOT, and approval details. Doing so helps maintain compliance and prevents misunderstandings later in the project.

Generate Compliant Contract Variation Letters with Mastt

Variation management shouldn’t slow down project delivery. Mastt gives project teams a structured way to create and issue contract variation letters directly from their contract data with no formatting, manual entry, or version chasing.

Each variation you create links automatically to its contract, valuation, and approval record, so you always have a complete audit trail. Whether you’re issuing a Variation Instruction, updating the Contract Sum, or recording an Extension of Time, everything stays consistent and contract-compliant.

👉 Create your next contract variation letter in Mastt and keep every change clear, consistent, and contract-ready.