Need advice from fellow contractors on agency fees.

[Hancock]

I have been working as a contractor for a company for the last 18 months. Last September my contract has been renewed and I was asking for a raise which I was denied. I was told the client was unable to accommodate a pay increase.

Since the beginning of the contract have I been paying 300 euros monthly as a flat rate agency fee but just recently (after 2 months of not getting due to their incompetence) I have found out that they have been taking 80 euros of my daily income. This really ****es me off and seems like an absurd amount. In a 20 day month this amounts to 1900 Euros in agency fees! Yet still they denied me a raise, not even 10 euros more per day.

I have written a complaint to them and demanding a raise of 50 Euros/day and 50 Euros for each day I have worked since last September. The agency replied by saying that their super busy manager will get back to me "soon". Well its been two weeks now of me trying to get in touch with him and he finally agreed to call me this weekend...

Anyway, I am looking for some advice as this is my first gig as contractor. Am I asking for too much? I don't understand how they can justify taking this large chunk out of my salary. Why do I have to pay them a monthly fee if they are already taking about 26% out of my daily salary?!

TLDR: I found out my agency is taking 80 euros out of my daily paycheck on top of a 300 euro monthly fee. My goal is to reduce this to 30 euros daily + 300/month. Is this unreasonable?

[mudskipper]

I'm assuming that, as you're paid in Euros, this isn't UK.

In the UK, one would expect the agency to be on a margin of anything from around 7 - 20% with 15% being quite usual, and more not being unusual.

Not sure what the fixed monthly fee is - that sounds like umbrella services - in the UK this is normally a different company to the agency.

Normally you would agree a rate with the agency (e.g. 400 Euros) and that is what you get paid. What the agency agrees with the client is separate. When you say they're taking 80 Euros out of your daily income, is that out of the fee that you agreed for the job? (i.e. if the agreed rate is 400, are you getting 320, or have you discovered they're charging the client 480?) If it's an umbrella, it would be normal for them to take tax, NI and possibly an amount to cover sick and holiday pay.

Without more info on where and how you are operating, I doubt anyone is going to be able to offer much in the way of useful advice.

[psychocandy]

Thats a new one - agency fee plus margin.

Alas, they aren't going to do anything about it no matter how much you moan and stamp your feet. You agreed to this and they are happy to take the money.

Only option is to serve notice and walk. Otherwise, I bet my left nut they wont do anything mid contract.

Just be grateful you know this so you have some leverage come renewal time. Knowledge is power and all that.

Personally, I would have kept quiet that I know all this. Would have given you more power - now they know you know.

Very annoying I agree but nothing you can do.

[RoastedSlopes]

Thats a new one - agency fee plus margin.

Alas, they aren't going to do anything about it no matter how much you moan and stamp your feet. You agreed to this and they are happy to take the money.

Only option is to serve notice and walk. Otherwise, I bet my left nut they wont do anything mid contract.

Just be grateful you know this so you have some leverage come renewal time. Knowledge is power and all that.

Personally, I would have kept quiet that I know all this. Would have given you more power - now they know you know.

Very annoying I agree but nothing you can do.

Was dealing with an Agency monkey earlier this week who quoted me £525 a day, then stated in another call that that rate was the agencies rate so after their margin it is 450 a day. SO their margin is 15%

needless to say we ended our discussions

[northernladuk]

Was dealing with an Agency monkey earlier this week who quoted me £525 a day, then stated in another call that that rate was the agencies rate so after their margin it is 450 a day. SO their margin is 15%

needless to say we ended our discussions

Why? 15% isn't insane and knowing this you are in a perfect position to negotiate.

Also got to do the maths. Another couple of weeks in the bench hoping for a higher rate doesn't always work out as you planned.

[Andy Hallett]

Based on the pricing, I'd guess that you are working in The Netherlands and the €300 is the Management Company you will need to run through for tax compliance.

I presume you knew all the figures at the start?

[psychocandy]

Why? 15% isn't insane and knowing this you are in a perfect position to negotiate.

Also got to do the maths. Another couple of weeks in the bench hoping for a higher rate doesn't always work out as you planned.

Be happy with 15% after what I've found out in previous gigs....

[Ticktock]

Be happy with 15% after what I've found out in previous gigs....

I'm happy with my rate, although I have since discovered that the agent is making well over 20%. I know I command more than many others in my field already, but I guess this goes to show that I can still potentially up my rates further.

But, again, I'm happy with the rate I took - I'll just be pleased to take a higher rate if I can.

[RoastedSlopes]

Why? 15% isn't insane and knowing this you are in a perfect position to negotiate.

Also got to do the maths. Another couple of weeks in the bench hoping for a higher rate doesn't always work out as you planned.

I don't like it when Agencies use this tactic to draw punters in knowing full well this was a deliberate 'mistake'

I also accepted a renewal so was just keeping my options open.

Granted if I was on the bench then I may have a slightly different thought, but I don't like agencies who deceive

[psychocandy]

I'm happy with my rate, although I have since discovered that the agent is making well over 20%. I know I command more than many others in my field already, but I guess this goes to show that I can still potentially up my rates further.

But, again, I'm happy with the rate I took - I'll just be pleased to take a higher rate if I can.

Moan when you find out its 40% :-)