Perm vs contract offers

[PurpleGorilla]

Also, £500 sweet rate for say 2 years may be great. Then what? You need another gig on a day rate, you need to be confident you can find the next one and the next one.

Personally I not a fan of day rates. And prefer the flexibility of hourly rates. I would want at least £70 an hour to leave that permie role.

£70 * 1650 = now we are talking.

[MyUserName]

Everything everyone else has said and ....

70k a year is not to be sniffed at, 500 per day is only 500 per day when he has a contract and is able to work for that day. Things can go wrong e.g. what if he broke his leg and his client did not want people working from home - they would drop him and get someone else whereas perm employers are likely to be less harsh.

Where is he based? Is there a lot of contract work nearby? If not then he might have to travel for new contracts. This means he can never rely on things like being able to do the school run etc. Any and all plans like that will never be possibly passed the end of his current contract because any further ones, this is not a big deal for many but for my family (where Mrs MUN does not drive and my daughter gets upset if her schedule is changed) it became a deal breaker.

[cherhill]

It's not about the money. You just cannot compare rate to salary. There are far too many unknowns and some of them introduce an element of risk that need to be considered. Contracts are not often for a year and you can get walked off/rate cut at a moments notice. If you can't stomach a couple of months off out of the blue go perm.

Am always of the thinking if anyone is considering a permie gig vs a contract gig they should always take the permie one. 99 times out of a hundred it's just the rates that are pulling them and haven't considered anything else so go permie.

This is very good advice. I agree with this 100%.

[BlasterBates]

The big thing in contracting is travelling expenses. Without expenses and time it's a no brainer you go contracting. Once there's a bit of down turn and you're on 300 a day in the back of beyond, then you're better off in the 70 grand comfortable job round the corner.

So for now the 500 day is much better, but in two years in might look different. The other thing to bear in mind is does he want to build a career become "a big fish", that won't happen contracting.

On the whole you might as well give it a go but build up a warchest and not expect it to go on indefinitely, and be someone without career ambitions.

[sal]

Also, £500 sweet rate for say 2 years may be great. Then what? You need another gig on a day rate, you need to be confident you can find the next one and the next one.

Personally I not a fan of day rates. And prefer the flexibility of hourly rates. I would want at least £70 an hour to leave that permie role.

£70 * 1650 = now we are talking.

Then you can take one year off and still be better off, that a permie who worked 3 years on 70k (which according to the OP is actually 60k + bonuses)

I don't understand why people think that permies have guaranteed income? Companies go under everyday and people lose jobs.

[TheFaQQer]

Then you can take one year off and still be better off, that a permie who worked 3 years on 70k (which according to the OP is actually 60k + bonuses)

I don't understand why people think that permies have guaranteed income? Companies go under everyday and people lose jobs.

If the company is going under, then it makes no difference whether you are contractor or permie - you're going to be out without any payment.

If the company chooses to make you redundant, then it makes a big difference when compared to being a contractor who gets terminated on zero notice.

There is no such thing as job security, but some are more secure than others.

[BolshieBastard]

Yes, we have a warchest to cover one year.

Its a 6month contract, but its a 12month new project. He was told in the interview that an extension is likely if things go ok.

The contract length is only as long as the notice period. So in effect its one day.

[quackhandle]

The contract length is only as long as the notice period. So in effect its one day.

+1, not to be all doom and gloom, how well does your partner understand IR35?

Two years in a £500 a day gig is very nice but not so nice if you get investigated and be found to be inside IR35. Kerching for Hector! £$£$£$£

qh

[jmo21]

I don't understand why people think that permies have guaranteed income? Companies go under everyday and people lose jobs.

People always say that on here, and while true, I think more of our normal contracts come to and end naturally or end prematurely than permies get made redundant, so saying "why people think that permies have guaranteed income" is not a fair comparison really.

Plus most permies do not think about redundancy until/unless it happens to them.

So from that frame of mind, permie = regular, reliable paycheck - this is good for financial planning, starting with paying the mortgage/rent, and all other bills.

Turning their mind to going contracting, they immediately think of 2 things - big day rates..... but wait, the contract ends... what do I do then?

[BolshieBastard]

Then you can take one year off and still be better off, that a permie who worked 3 years on 70k (which according to the OP is actually 60k + bonuses)

I don't understand why people think that permies have guaranteed income? Companies go under everyday and people lose jobs.

Permies get paid if there is no work to do. Permies only find themselves unemployed if something has gone wrong ie they've been caught with their hand in the sweetie jar or the company goes mams up.

You are correct to a degree. Permiedom has far greater job security than contracting does.