Contract 'error' and renewal rate reduction

[Denny]

Hi,

I'm 5 weeks into a 3 month contract and in week 3 my agency rang me and said they had made an error in my contract (which I have back from them all signed & dated).

They say the rate on our contract is incorrect.

Too keep numbers confidential, but accurate, lets say I am currently on £24/day. The agency say the rate should have been £19/day.

I have no record of agreeing £19/day, and can only genuinely remember talking to them about £24-5/day.

Apparently End Client has an email talking about an original £30/day between Agent and Client, but then finally talked about a rate of £25/day between Agent and Client which they agreed. However, when the paperwork was sent from Agent to Client, the £30/day was used, and Client signed it (underling signed it, Boss who negotiated £25/day was on hols and had not told underling about the new £25/day rate).

My Agent wanted me to take the complete hit difference so they could keep their 20% margin, I was not amused and said we could talk about it and advised them to negotiate with Client.

Anyway, after much huffing and puffing and pissing the Client off by the Agency (client is very happy with my work), Agent gets back to me and says my contract rate on this current contract will stay the same, but the renewal come the end of January 2007, which the Client says is 80-90% certain to be offered will only be at the lower rate, ie, £19/day and not the current £24/dat.

I've <cough> overheard that the client will not be reducing their rate paid to the Agent in the renewal contract, and that the rate they are agreeing is ~£28/day.

Further info: probably unforgivably, I signed the opt-out of the EU regulations thingy.

My thoughts are that the handcuff clause in the contract is unreasonable if they are going to reduce my rate by ~23% for the renewal, a renewal that I have earned by my performance.

Any ideas what I should do / be thinking about?

Kind regards.

Funny how EBs never ring us up to say they've made a mistake by putting the rate too low on our contracts.

[Cowboy Bob]

Bob. I shall introduce you to the world of embedded systems......

tim

Don't worry, I get a lot more

Just saying that would be the absolute minimum for someone with 8 years experience in anything technical.

[Shaggydabbydo]

Try here

http://www.itjobswatch.co.uk/contrac...0consultant.do

HTH

Thanks, much better

OK, in respect to XLMonkey's view that "the reduced rate would have to be demonstrably below the market rate for the contract for it to be deemed unreasonable.", I, after looking at that site, can show that my current rate is bang on average, and that the proposed renewal rate is 22% lower than average (also, I'm aware that the client will be paying the same rate to the agency at renewal time as they will be paying for this current contract).

I'm guessing their demand for the lower rate passes as 'unreasonable'?

Any views on what I think about doing next, apart from:

1. Looking for another contract:
i) just in case;
ii) as leverage.
2. Not talking to agency until they get back to me with a better offer (preferably at my current rate);
3. Research a lawyer (any recommendations and estimated costs??).

Regs, Shaggy

PS, this site is a damn good resource, thanks for all your views so far

[tim123]

Don't worry, I get a lot more

Just saying that would be the absolute minimum for someone with 8 years experience in anything technical.

Yeah,

So tell me.

How, in the world of embedded systens do I, with almost 28 years experience, achieve a rate of 45 ph (we still bill in hours round here).

Over the last 12 months have been offered a low of 23 and a high of 35.

tim

[XLMonkey]

if you're current rate is about market average, then you've got a good starting position. However, this sort of scenario rarely ends up with lawyers (and when it does, it usually means that one or both sides of the argument has handled it badly). So, I wouldn't worry about getting hold of a lawyer at this stage.

i suggest that you should
1. read your contract nice and carefully, then do the same with any of the other paperwork that the agency has sent you
2. look for other contracts (don't go mad, just set up the usual searches) and satisfy yourself that you can get your current rate and/or better out there in the big wide world.
3. as discussed before, refuse to get into discussions about rate reductions at all - you should be arguing for an increase to your rate at renewal time, not accepting a reduction.

[lukemg]

Shaggy, point blank refuse to discuss any reduction come renewal time. You are holding all the cards, client wants you to stay, agency are looking at fees for doing sod all. They will lose those fees (even at a reduced level) AND any chance of work through that client.
They will grumble, put pressure on, but they won't cancel the contract, I am certain of that !
Just say no, I will not renew for less than the current rate, tell the client what you are doing (but don't be constantly going to the client to complain, you become a pain = bye) and leave them to it.
If you aren't confident, do it by email and ignore phone calls (they use this all day every day and are better at it than you). Don't even get into the discussion, you don't care what happened, who messed up what blah, blah. You will stay at the current rate, end of.
HTH

[Shaggydabbydo]

Shaggy, point blank refuse to discuss any reduction come renewal time. You are holding all the cards, client wants you to stay, agency are looking at fees for doing sod all. They will lose those fees (even at a reduced level) AND any chance of work through that client.
They will grumble, put pressure on, but they won't cancel the contract, I am certain of that !
Just say no, I will not renew for less than the current rate, tell the client what you are doing (but don't be constantly going to the client to complain, you become a pain = bye) and leave them to it.
If you aren't confident, do it by email and ignore phone calls (they use this all day every day and are better at it than you). Don't even get into the discussion, you don't care what happened, who messed up what blah, blah. You will stay at the current rate, end of.
HTH

Thanks.

Client knows I want a renewal at my current rate but am having a problem with the Agent; I will be 'busy' when Agent rings and only communicate via email; look for another contract just in case (heck, I might even find a better one ); see who blinks first in this game of me vs Agent chicken.

Thanks all.

Regs, Shaggy



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