Time and Materials (T&M) Contract

Time and Materials (T&M) Contract

A flexible contract where the client pays for actual labor hours and materials used.

54,023.06

(4 customer reviews)

Description

A Time and Materials (T&M) Contract allows project owners to pay based on actual labor hours worked and materials used rather than a fixed price. This structure provides flexibility for evolving project scopes but requires close monitoring to control costs. The contract specifies hourly rates, material costs, markups, and payment terms. While T&M contracts reduce risk for contractors by covering unforeseen expenses, owners must enforce budget control mechanisms. They are best suited for projects where exact requirements are unclear at the start, such as renovations or emergency repairs.