Time & Material Billing: How to Get Paid for Every Hour

When T&M is the right call

Time and material, sometimes called force account or cost-plus extra work, is used when the scope is genuinely unknown when work begins. You bill your actual labor, equipment, and materials plus an agreed markup rather than a fixed price.

It protects you from pricing a number you cannot stand behind. The catch is that the owner carries the cost risk, so they will demand proof of every hour. Use it when you cannot reasonably estimate the work, not as a habit, or the relationship sours fast.

• •Changed conditions: rock where the soil report showed dirt, hidden utilities, rotted framing behind a wall
• •Owner-directed changes before a change order price is settled, so the crew keeps moving
• •Emergency or unforeseen repairs where stopping to price the work costs more than the work itself
• •Investigative or exploratory work where the real scope is not visible until you open things up

What a defensible T&M ticket contains

Most disputes trace back to a ticket that was missing one field. Treat the ticket as a legal record, because in a claim that is exactly what it becomes. Every ticket should stand on its own without anyone needing to remember the day.

• •Date, project, location, and a plain-language description of the work and why it was extra
• •Each worker by name and classification, with hours split into straight time, overtime, and double time
• •Equipment used, the hours or days, and the agreed rate for each piece
• •Materials with quantities and unit costs, plus the markup the contract allows
• •The contract reference or directive number that authorized the work
• •A signature from an authorized owner or GC representative, dated the day of the work

Get the signature the same day

The single biggest reason T&M gets short-paid is a signature collected late, or never. A field rep who watched the crew all afternoon will sign without complaint. The same person, asked three weeks later at the closeout table, suddenly remembers it differently and trims your hours.

Daily sign-off does not certify that the price is fair, only that the labor, equipment, and materials shown were actually used that day. Make that distinction clear to the signer and you will get the signature far more often. If you log daily reports in Field PM, the hours and crew on the report should match the T&M ticket line for line, so the two documents corroborate each other if anyone ever questions the bill.

Why T&M gets disputed or short-paid

Knowing the common attack lines lets you close the gaps before you submit. Almost every reduction an owner makes falls into one of these buckets.

• •No signature, or a signature from someone without authority to approve extra work
• •Hours that do not reconcile with your certified payroll or daily report
• •Markup applied at a rate the contract does not permit, or markup stacked on subcontractor markup
• •Idle or standby time billed at full working rates without a clause that allows it
• •Materials billed at list price when the contract calls for actual invoiced cost plus markup
• •Tickets batched and submitted weeks late, after the work is impossible to verify

Make the ticket routine, not a scramble

The contractors who get paid in full are the ones for whom a T&M ticket is muscle memory: fill it out before the crew leaves, walk it to the GC super, get the signature, and file it that day. The ones who lose money treat the ticket as paperwork to reconstruct on Friday from a foreman's memory.

Standardize the form so no field gets skipped, set your ST, OT, DT, equipment, and markup rates from the contract once, and reconcile every ticket against the crew's time clock entries. When your time records, daily reports, and T&M tickets all tell the same story, there is nothing for the owner to dispute and the invoice gets paid as written.