When working with contracts, there are often many stipulations and requirements between the two parties involved. Sometimes, these stipulations may violate ethical beliefs and values. Time and materials contract is a hybrid from of contract usually for smaller projects. It is used when the scope is not very clear. There are few strategies to resolve conflicts such as problem solving, collaborating, compromising, accommodating, forcing and withdrawing. In the given situation, the boss has suggested withdrawal as a strategy but that is not a winning strategy. Project Manager should ideally go for problem solving/confronting as it is a win win strategy for both the parties. Project Manager should understand the concern, discuss and resolve the same.