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Construction Glossary

Document Type: Reference
Version: 1.0
Last Updated: February 2026
Distribute To: All Employees, New Hires


A

Addendum - Written change to bid documents issued before bid opening

AIA - American Institute of Architects; publishes standard contract forms

Allowance - Amount in contract for specific item not yet determined

Alternate - Optional scope item priced separately in bid

As-Built Drawings - Drawings updated to show actual constructed conditions

ASI - Architect's Supplemental Instructions


B

Back-Charge - Deduction from subcontractor payment for work performed on their behalf

Base Bid - Primary bid amount before alternates

Bid Bond - Guarantees contractor will enter contract if awarded

Bid Leveling - Comparing subcontractor quotes to ensure same scope

Bid Shopping - Unethical practice of sharing bids to get lower prices

Bonding Capacity - Maximum amount of work contractor can bond

Builder's Risk - Insurance covering work in progress

Buy-Out - Process of awarding subcontracts after winning project


C

Cardinal Change - Change so significant it's outside contract scope

Certificate of Occupancy (CO/C of O) - Permit allowing building use

Certificate of Substantial Completion - Document certifying work substantially complete

Change Order (CO) - Written modification to contract

CGL - Commercial General Liability insurance

Claim - Demand for additional compensation or time

Completion Date - Contractual deadline for project completion

Constructive Change - Action by owner that changes work without formal change order

Contingency - Reserve for unknown conditions or risks

Cost Code - Accounting classification for job costs

CPM - Critical Path Method (scheduling)

CSI - Construction Specifications Institute


D

Daily Report - Document recording daily project activities

Davis-Bacon - Federal law requiring prevailing wages on federal projects

Deficiency - Work not meeting contract requirements

Demobilization - Removing equipment and personnel from site

Design-Build - Delivery method where one entity designs and builds

Differing Site Conditions - Subsurface conditions different than anticipated

Direct Costs - Costs directly attributable to specific work

Division - Major category in specifications (CSI MasterFormat)

Draw - Progress payment request


E

EMR - Experience Modification Rate (workers' comp safety metric)

Extra Work - Work beyond original contract scope


F

Fast Track - Overlapping design and construction to compress schedule

FF&E - Furniture, Fixtures, and Equipment

Field Order - Minor change directive from architect

Final Completion - When all work including punch list is done

Float - Schedule flexibility between activities

Force Account - T&M work where owner reimburses actual costs

Force Majeure - Unforeseeable circumstances preventing contract fulfillment


G

GC - General Contractor

General Conditions - Division 1; also site overhead costs

GMP - Guaranteed Maximum Price contract

Gross Profit - Revenue minus direct costs


H

Hard Costs - Direct construction costs

Hold Harmless - Indemnification clause

Holdback - See Retention


I

Indirect Costs - Costs not directly attributable to specific work

Indemnification - Agreement to protect another from loss


J

JHA - Job Hazard Analysis

Job Cost Report - Report showing budget vs. actual by cost code


L

Latent Defect - Hidden defect not apparent at completion

Lien - Legal claim against property for unpaid work

Lien Waiver - Document releasing lien rights upon payment

Liquidated Damages (LDs) - Pre-set damages for late completion

Long Lead Items - Materials requiring extended procurement time

LOTO - Lockout/Tagout

Lump Sum - Fixed price contract


M

Markup - Addition to costs for overhead and profit

Material Safety Data Sheet (MSDS/SDS) - Chemical hazard information

Mechanics Lien - Lien filed by unpaid contractor/supplier

Milestone - Key project date

Mobilization - Moving equipment and personnel to site

Mockup - Sample assembly for approval


N

NCCCO - National Commission for Certification of Crane Operators

NIC - Not In Contract

Notice to Proceed (NTP) - Authorization to start work


O

O&M Manual - Operations and Maintenance Manual

OCIP - Owner Controlled Insurance Program

Overhead - Indirect costs of doing business

Owner - Party contracting for construction


P

Pay Application - Request for progress payment

Payment Bond - Guarantees contractor pays subs/suppliers

Percent Complete - Portion of work finished

Performance Bond - Guarantees contractor completes work

Permit - Government authorization to build

Preliminary Notice - Notice preserving lien rights

Prevailing Wage - Minimum wage rate for public work

Prime Contractor - Direct contract with owner

Procurement - Process of purchasing materials/services

Progress Payment - Partial payment during construction

Project Manual - Volume containing specifications

Punch List - List of items to complete/correct

Purchase Order (PO) - Document authorizing purchase


Q

Qualified Person - Person with training, knowledge, ability for task

Quality Control (QC) - Inspection to ensure quality


R

Rebar - Reinforcing steel bars

Retention/Retainage - Percentage withheld from payments

RFI - Request for Information

RFP - Request for Proposal

RFQ - Request for Quotation

ROPS - Rollover Protective Structure


S

Schedule of Values (SOV) - Breakdown of contract by line item

Scope of Work - Description of work to be performed

Shop Drawing - Detailed fabrication drawing

Soft Costs - Non-construction costs (design, permits, fees)

SOV - Schedule of Values

Specifications - Written requirements for work

Stop Notice - Notice to owner/lender to withhold funds

Subcontractor - Contractor working under prime/GC

Submittal - Document submitted for approval

Substantial Completion - Work sufficiently complete for intended use

Superintendent - Field supervisor

Surety - Company providing bonds


T

T&M - Time and Materials pricing

Take-Off - Quantity measurement from drawings

Toolbox Talk - Short safety meeting


U

Unit Price - Price per unit of work


V

Value Engineering - Process to reduce cost without reducing function

Variance - Difference between budget and actual


W

Warranty - Guarantee work is free from defects

WBS - Work Breakdown Structure

WIP - Work in Progress

Workers' Compensation - Insurance for employee injuries


Numbers/Acronyms

3-Week Look-Ahead - Short-term schedule

811 - Call before you dig (utility locates)

ADA - Americans with Disabilities Act

ANSI - American National Standards Institute

ASTM - American Society for Testing and Materials

AWG - American Wire Gauge

CFMA - Construction Financial Management Association

COR - Change Order Request

DIR - California Department of Industrial Relations

DOL - Department of Labor

GCs - General Conditions (costs)

IBC - International Building Code

NFPA - National Fire Protection Association

OSHA - Occupational Safety and Health Administration

PCO - Potential Change Order

PO - Purchase Order

QA/QC - Quality Assurance/Quality Control

SF - Square Feet

SWPPP - Stormwater Pollution Prevention Plan


Template provided by support.construction. Continually updated reference.