5-8 Contract Modifications

5-8.1 Types

There are two types of contract modifications:

1. Bilateral modifications (supplemental agreements) that are signed by both the supplier and the contracting officer. Bilateral modifications include modifications to do the following:
• Make equitable adjustments under paragraph c of Clause 4-1: General Terms and Conditions (March 2006), Clause B-37: Changes (Construction) (March 2006), or other clauses providing for equitable adjustment.
• Reflect other agreements of the parties modifying contract terms
2. Unilateral modifications are signed only by the contracting officer in accordance with a specifically identified contract clause. Unilateral modifications include modifications to do the following:
• Make administrative changes (unilateral changes, in writing, that do not affect the substantive rights of the parties, such as a change in the paying office).
• Issue change orders.
• Make changes authorized by specific clauses or contract provisions (such as exercising an option or suspending work).
• Issue termination notices.

Except for certain mail transportation contracts, only contracting officers are authorized to sign contract modifications for the Postal Service. Other Postal Service personnel may not do as follows:

• Act in a manner that causes the supplier to believe they have authority to bind the Postal Service.
• Direct or encourage the supplier to perform work that should be covered under a contract modification.

Contract modifications, including changes that can be issued unilaterally, must be priced before they are signed if it can be done without adversely affecting the interest of the Postal Service. If a significant cost increase could result from a contract modification and time does not permit negotiating a price, at least a maximum price must be negotiated whenever practicable.