The client walks the frame on a Saturday and asks for a bigger window in the living room, a cavity slider to the ensuite and the ceilings raised upstairs. You say “no worries, I’ll sort it”. Three months later the variations come to $40k and the client says they never agreed to the price.
This is one of the most common money fights on a small build. The QBCC lists failing to record and approve variations before the work is done as one of the most common causes of serious building disputes. The good news: most unpaid variations can be recovered, or at least settled, if you move quickly and in the right order.
Key takeaways
- Paper wins. A written variation with a description, a price and both signatures is the single biggest factor in getting paid.
- NSW, Queensland and Victoria all require variations on domestic building work to be in writing, with narrow exceptions.
- Claim it straight away. Put the variation in your next progress claim, or a payment claim under security of payment law if you’re a subbie.
- Don’t down tools on a whim. Check your contract before suspending work.
- Fund the gap separately so one disputed variation doesn’t stall the whole job or your wages.
Why do variations go unpaid?
It’s rarely one thing. On small builds and trade jobs the usual culprits are:
- Verbal agreement on site. A quick yes at the slab or frame stage, no price, no form.
- No price before the work. You did the work and priced it after. The client is shocked by the number.
- Scope arguments. The client says the work was already in the plans, so it’s not a variation at all.
- Foreseeable extras. Rock in the footings, an extra retaining wall, a bigger stormwater line. The client says you should have allowed for it.
- Head contractor squeeze. For subbies, the builder accepts the work but values the variation at a fraction of your claim, or holds it until the client pays them.
Each one needs a slightly different fix. But they all start with the same question: what can you prove?
What do the rules say in your state?
Here’s the short version for domestic (residential) work in the three biggest building states. Commercial contracts usually set their own variation process, so read the contract.
| State | What the rules require | Exceptions worth knowing |
|---|---|---|
| NSW | The NSW Government says variations must be in writing, attached to the contract and signed by both parties, with the cost impact explained. | Where there’s likely to be danger to someone or damage to property, there may not be time to write it up first. |
| Queensland | The QBCC says you must give the variation to the homeowner in writing before the work starts, and the homeowner must agree in writing. It needs a description, the date, any delay and the price change or how it’s calculated. | Urgent work where a written variation isn’t reasonably practicable first. You can’t require payment before the variation work starts. |
| Victoria | Consumer Affairs Victoria says both parties must agree to the change in writing before the work, using a variation notice with the new price and completion date. | No notice is needed for a client requested change that won’t change permits, cause delay or add more than 2% to the original contract price. |
Other states and territories have their own contract rules. If you build in WA, SA, Tasmania, the ACT or the NT, check with your state building regulator before you rely on a verbal deal.
One more trap in Victoria. Consumer Affairs says the client shouldn’t have to pay for variations needed to fix problems you should have spotted before work started, such as rock you could have predicted from the foundation data. That’s why the “foreseeable extras” argument comes up so often.
The variation wasn’t in writing. Can you still get paid?
Sometimes, yes. It’s harder, slower and more expensive, but it’s not hopeless.
In Victoria, the Court of Appeal decided in 2022 (Jolin Nominees v Daniel Investments) that a builder may still recover the cost of a variation without the proper notice where they’d suffer significant or exceptional hardship. That’s a high bar, not a free pass. In other states, a builder may be able to argue for a reasonable value of the work done. Either way, this is lawyer territory, so get advice before you threaten anything.
What helps your case:
- Texts and emails where the client asked for the change or agreed to it.
- Photos before and after the change, with dates.
- Site diary notes of the conversation: who, when, what was asked.
- Supplier invoices for the extra materials.
- A written variation now. Send it, even late, with the price worked out properly. NSW guidance says the calculation should be shown, not just a lump sum.
Then make a fair offer. A lot of verbal variation disputes settle once the client sees a clear breakdown instead of a number on the bottom of an invoice.
I’m a subbie. How do I chase a variation up the chain?
If the head contractor won’t pay your variation, your state’s security of payment law is usually the fastest tool you’ve got. A payment claim can include variations you say are owed. The builder then has to pay or give you a payment schedule that says what they’ll pay and why, by a set deadline. If they don’t, or the reasons don’t stack up, you may be able to go to adjudication.
Our guide to security of payment claims covers the deadlines in each state. The big rules for variations:
- Claim them as separate line items, with the instruction (email, site instruction, signed docket) attached.
- Don’t wait for the final claim. Lumping three months of variations into one invoice makes it easier for the builder to knock it back.
- Keep working on the contract scope while the variation is argued, unless you’ve had advice that you can suspend.
If the variation is holding up more than one claim, the gap can get big fast. See what funding you could qualify for before it starts eating into wages.
What to do this week if a variation is unpaid
| Day | Action |
|---|---|
| Today | Pull together the paperwork: contract, plans, any written variation, texts, emails, photos, supplier invoices. |
| Day 1–2 | Send a written variation (or a written claim if it’s already been disputed) with a clear price breakdown. |
| Day 3–5 | Phone the client or builder, then confirm what was said by email. Offer a meeting on site if the scope is in dispute. |
| Next claim | Include the variation as its own line in your next progress claim or payment claim. |
| If still stuck | Get advice from a construction lawyer, your industry association or your state’s building disputes service. |
Meanwhile, keep the rest of the job moving and keep the account healthy. Disputes drag on. Wages and supplier accounts don’t wait.
Example: a small builder in Newcastle with $40k stuck
Example (invented business, round numbers): A two-person building company in Newcastle is doing a knockdown rebuild on a $700k contract. At frame stage, the owners ask for three changes:
- Raised ceilings upstairs: about $18k, signed variation with a price.
- Larger living room windows and a stacker door: about $12k, agreed by text, priced later.
- An extra retaining wall after rock was hit: about $10k, no variation issued.
The builder claims all three in the lock-up claim. The owners pay the base stage and the signed ceiling variation, but dispute the windows and the retaining wall. That’s $22k unpaid, and the builder has already paid the window supplier and the excavator.
What happens next:
- The builder sends a written variation for the windows, attaching the owners’ text and the supplier invoice. The owners agree to pay it with the fixing claim.
- The retaining wall is the hard one. The builder gets advice and offers to split the cost, since the soil report hinted at rock.
- To cover the gap and keep the chippies and the brickie paid through lock-up, the builder uses a short term cash flow loan for tradies based on the business bank statements, repaid when the fixing claim lands.
The lesson isn’t “borrow”. It’s: get paper early, claim fast, and have a plan for the weeks in between.
How do I stop this happening on the next job?
- Use the variation form for every change. QBCC templates include one, and the HIA and Master Builders contracts have their own. Keep a pad in the ute.
- Price before you build. Even a rough “up to $X” price, signed, beats a perfect price sent later.
- Photograph the instruction. A photo of the client’s sketch on a stud is evidence.
- Allow for site risks in the base price where the reports point to them, so a foreseeable extra isn’t a fight.
- Claim variations with the next progress claim, not at the end.
- Check what you can claim up front. In Queensland you can’t require payment for a variation before the work starts, so price your cash flow for that.
How can you fund the job while a variation is in dispute?
| Option | Suits | What you need |
|---|---|---|
| Progress payment gap finance | Bridging the time between doing the work and a claim being paid | Property with equity, or steady business bank statements |
| Unsecured cash flow loan | Keeping the crew and the trade account paid while the variation is argued | An ABN, at least 6 months of trading and your latest business bank statements |
| Second mortgage or bridging loan | A larger shortfall covering a full stage or a few jobs at once | Usable equity in a property owned by you or a guarantor |
| Builder finance | Small builders carrying more than one disputed claim | Property you already own, or business bank statements |
How it works in practice: we lend between $20,000 and $5 million, for business use only. A secured loan sits over a property already in your name or a guarantor’s, like the family home or a rental, and never over what the build will be worth at PC. No tax returns or financials are needed for those, a patchy credit file or an ATO debt won’t automatically rule you out, and settlement can happen in as little as 24 hours after the valuation and paperwork are done. Most run for somewhere between one month and a year. On the unsecured side, some deals go from approval to cash in the account within hours. Own property? Run it through the construction equity calculator to see roughly how much equity you can use.
Don’t let one variation stall the whole build
A disputed variation is a paperwork problem first and a cash flow problem second. You can fix the paperwork this week. The cash side is where we come in. We talk to small builders and subbies every week who are owed money for work that’s done and sitting in a claim, and the job still needs to keep moving.
The enquiry takes about 60 seconds and there’s no credit check when you first enquire. We don’t send your details to a pile of lenders, so no flood of calls from strangers. A real person who knows how progress claims and variations work reads your enquiry and calls you back to talk through the job.
Please fill the form in accurately: how much you need, what’s holding the money up, how long you’ve been trading and, if you own property, roughly what it’s worth and what’s owed on it. Straight numbers mean the first option we put in front of you is one that can actually fund.
