Changes involving deletion of work may occur when the government simply eliminates a portion of the original contract work or substitutes different work for it. When work that was separately priced as a distinct item of work is deleted, the original bid price is considered to be the proper measure of the downward adjustment. If the item was bid at a high profit level the contractor loses whereas if the item was in a lose position, he is relieved of the loss.

The government frequently attempts to apply this same method when there is not a separate price in the contract but numerous cases have rejected this approach indicating the adjustment should be based on cost estimates. Cost experience to base the price adjustment can not be used since the deleted work was not performed. Hence, cost estimates of the deleted work are used. When work is deleted, the adjustment in price to which the government is entitled equals the reasonable costs for the work as estimated by the contractor when the contract was entered into plus estimated profit. Numerous cases have placed the burden of proving the amount of the downward adjustment on the government. This principle has been softened in recent cases where the courts have stated they are reluctant to accept the original bid estimate as the sole source of a downward adjustment stating the reasonableness of the estimate should be independently supported so the risk of a bidding error is not passed from the contractor to the government. For minor amounts contractor estimates are used without verification.

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