Backcharges are one of the most frustrating and time-consuming workflows in commercial construction—especially for General Contractors. Whether it’s damage to completed work, schedule delays, or unfulfilled scope, backcharges are essential for holding trade partners accountable.
But the process itself is often fragmented. It can take days—or even weeks—for one subcontractor (Sub A) to price and submit a Change Order Request (COR) for the repair work, leaving the GC in limbo. Then begins the back-and-forth: identifying the responsible party (Sub B), manually preparing a deductive COR, emailing documentation, fielding disputes, and logging the transaction manually.
Without a purpose-built solution, GCs risk delayed closeout, financial exposure, and unnecessary conflict. The good news? With the right workflows in place, backcharges can become a strategic tool for preventing disputes and controlling risk.
Here are five proven tips to help GCs streamline backcharges across every project.
1) Standardize the Backcharge Process Across Your Projects
Backcharges often vary wildly from one project—or project manager—to another. Some teams document thoroughly, others rely on email or even undocumented verbal agreements. This lack of consistency leads to disputes, confusion, and exposure at closeout.
By standardizing how backcharges are initiated, approved, and communicated across all teams, GCs can reduce ambiguity. Define a simple template for what needs to be captured (date, scope, photos, parties involved, resolution steps) and ensure it’s used universally. Whether you're using paper forms, spreadsheets, or digital tools, the key is consistency.
2) Capture Backcharges in Real Time, Not Weeks Later
The further you get from the moment of impact, the fuzzier the details become. Field teams are often juggling multiple priorities, and without an easy way to log a backcharge event on the spot, it’s likely to get delayed—or forgotten entirely.
Encourage your supervisors and foremen to document issues as they happen. This could mean snapping a photo, capturing details in writing, and logging the impact before moving on. A timely record not only strengthens your case—it gives the subcontractors involved a fair chance to respond while the context is still fresh.
3) Use Visual Evidence to Support Every Claim
A backcharge is much easier to dispute when it’s just a line item on a spreadsheet. But when it’s supported with photos, annotated drawings, marked-up plans, and organized documentation, it tells a story.
Make it standard practice to include visual evidence for every backcharge. A quick photo of rework or an annotated site image goes a long way in avoiding drawn-out arguments. It provides undeniable context and helps all parties align on what happened and why.
4) Automate Notifications to Keep Everyone in the Loop
Even when a backcharge is documented properly, breakdowns in communication can cause delays. Project managers may not loop in accounting. Trade partners may not see the notification until weeks later. This leads to limited visibility and undermines trust.
Implementing a system that automatically notifies key stakeholders—PMs, subs, project controls, and cost managers—when a backcharge is initiated ensures that no one is caught off guard. Whether through email, SMS, or an integrated project platform, automation keeps the workflow moving and the paper trail transparent.
4) Maintain a Centralized Log for Backcharge Activity
Disparate records scattered across emails, spreadsheets, and shared drives make it nearly impossible to get a clear view of your backcharge exposure. This complicates forecasting, slows down closeout, and creates headaches for your finance team.
A centralized, searchable log—preferably one that updates in real time—provides project teams with one source of truth. Ideally, your log will allow you to quickly filter by subcontractor, issue type, project, or dollar amount. More importantly, it should give leadership visibility into how backcharges are being managed across the project and the organization.
Conclusion: Turning Conflict into Clarity
Backcharges don't have to be a source of frustration. With consistent documentation, real-time communication, and a centralized workflow, GCs can turn a historically painful process into a tool for accountability and proactive risk prevention.
Here at Clearstory, we’ve addressed these challenges head-on with a digital backcharge workflow that:
- Allows GCs to create backcharges from a received COR with a single click
- Automatically populates critical fields like COR number, backcharge amount, and recipient details
- Includes the original COR file and ties the backcharge to a specific PCO number for complete auditability
- Sends the backcharge via email to the responsible trade partners and logs it in their COR log automatically
- Provides real-time visibility across all backcharge activity in a centralized dashboard
The result? A faster, more transparent, and less conflict-prone process—so you can focus on building, not chasing paperwork.
Want to see it in action? Check out our Backcharges feature blog or book a demo to see how Clearstory can streamline your next project.
