Back Charge
A Back Charge is when one company bills another for costs that weren't originally planned but were necessary to fix problems or complete work. For example, if Company A has to fix mistakes made by Company B, Company A can 'back charge' those repair costs to Company B. It's like asking for reimbursement when you have to spend your own money to fix someone else's mistake. This term is important in construction and contracting because it helps manage unexpected costs and ensures companies are held responsible for their work quality.
Examples in Resumes
Successfully managed Back Charge processing resulting in $500,000 cost recovery
Implemented new Back Charge procedures to improve contractor accountability
Handled dispute resolution for Back Charges and contract negotiations
Documented and processed Back-Charge claims for subcontractor performance issues
Typical job title: "Contract Administrators"
Also try searching for:
Where to Find Contract Administrators
Professional Organizations
Online Resources
Example Interview Questions
Senior Level Questions
Q: How would you handle a disputed back charge with a major subcontractor?
Expected Answer: A senior professional should discuss the importance of documentation, communication process, contract review, negotiation strategies, and having a clear escalation path. They should mention maintaining business relationships while enforcing contract terms.
Q: What system would you implement to prevent back charges from occurring?
Expected Answer: Should explain preventive measures like clear scope definitions, regular quality inspections, documented communication protocols, and proactive contractor management strategies.
Mid Level Questions
Q: What documentation do you need to process a back charge?
Expected Answer: Should mention photographs, written notifications, cost breakdowns, timesheets, material receipts, and correspondence records that support the back charge claim.
Q: How do you determine if a back charge is justified?
Expected Answer: Should discuss reviewing contract terms, scope of work, comparing against industry standards, and evaluating whether proper notice was given to the contractor to correct issues.
Junior Level Questions
Q: What is a back charge and when is it typically used?
Expected Answer: Should be able to explain that a back charge is billing a contractor for costs incurred to fix their work or complete their obligations, with basic examples.
Q: What steps do you take when initiating a back charge?
Expected Answer: Should describe basic process: documenting the issue, notifying the contractor, collecting cost information, and submitting proper paperwork.
Experience Level Indicators
Junior (0-2 years)
- Basic contract documentation
- Cost tracking
- Communication with contractors
- Filing and organizing claims
Mid (2-5 years)
- Contract interpretation
- Negotiation skills
- Documentation management
- Cost analysis
Senior (5+ years)
- Strategic contract management
- Dispute resolution
- Risk management
- Policy development
Red Flags to Watch For
- Lack of attention to documentation detail
- Poor understanding of contract terms
- Inability to explain basic claim processes
- No experience with contractor communications
- Unfamiliarity with construction project management
Related Terms
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