What do Payment Clauses typically detail in a contract?

Payment clauses in a contract fundamentally outline the methods and conditions for how and when a contractor will be compensated for their work. These clauses provide clarity on various aspects, including payment schedules, milestone payments, invoicing procedures, and any conditions that must be met before payment can be processed. By detailing these elements, payment clauses help ensure that all parties have a mutual understanding of financial transactions, which is crucial for the successful execution of the contract.

In contrast, approval processes for project changes relate to how alterations to the project are managed and authorized, which is not within the main focus of payment clauses. Similarly, criteria for contractor selection involve the qualifications and evaluation of contractors before a contract is awarded, which is a separate phase of the contracting process. Lastly, specifications for project deliverables detail what needs to be produced or achieved under the contract and do not pertain to the financial aspects of the agreement.