Schedule of Rates

A schedule of rates is a priced document listing individual work items by unit of measurement, agreed between a contractor and client before work begins. Instead of a fixed lump-sum price for a defined scope, the contract uses agreed unit rates - covering labor, materials, or both - which are then applied to actual quantities as work is instructed or measured on completion.

When a Schedule of Rates Is Used

Schedules of rates are most common in term maintenance contracts, reactive maintenance frameworks, and long-term service agreements where the full scope of work cannot be known in advance. Rather than pricing each job individually from scratch, both parties agree a set of unit rates at the outset. When work is instructed - for example, a reactive repair visit or a refurbishment phase within a rolling programme - the applicable rates are applied to the measured quantities, and the invoice follows from that calculation.

They are also used in project contracts to value variations and additional works. Where a contractor submits a claim for unforeseen work, a schedule of rates provides an agreed pricing basis rather than requiring a new quotation to be negotiated under time pressure.

Schedule of Rates vs. Rate Card

The two terms are sometimes used interchangeably but serve different purposes. A rate card is typically an internal pricing reference used by a contractor for estimating - it reflects cost base and target margin and may not be shared with the client. A schedule of rates is a contractual document: the rates have been negotiated and agreed with a specific client and form part of the contract. The rates in a schedule may differ significantly from a contractor's internal estimates, depending on competition at tender stage and the volume of work committed.