Contract negotiation query...

[jamesbrown]

It sounds to me as though they view you as a permie (on a fixed-term contract w/o permie benefits), so you should be very worried on that front. All this crap about benchmarking to permie rates is exactly that, crap.

[SpontaneousOrder]

Now, I just don't understand how best to explain to them that they are way under, esp. when they seem so confident that they're right?

What make syou think they'd ever pay you more than they currently do? Even if they did realise they're paying wel under market rates? All you do by arguing for 6 months is tacitly tell them that you're perfectly willing to be mugged off.

You're a business, right? So if market price really is higher then just terminate (or allow to expire) and move on.

[SpontaneousOrder]

perhaps that they feel they can replace me with a 65k p/a perm PM?

It's called 'eating your cake and still wanting to have it'. There is a reason they hire you rather than a permie.

[TheFaQQer]

OK, just to clarify I was never, ever on 65k perm. I started out at around 230 p/d and now am being offered 247 (they see it the same as 65k for a permie, not even sure how thats relevant though). I stuck with the job as they were a flexible company and I had a bereavement in the family that I had to sort out.

I've been arguing my case for 6 months, only to be told their evaluation of me is that 247 is fair rate. Although not senior, I'm a valuable part of their team (their words), have worked through many challenging circumstances and never say no/kick up a fuss - so definitely not a clock watching mug

Now, I just don't understand how best to explain to them that they are way under, esp. when they seem so confident that they're right?

Point them here - True Cost of an Employee Calculator

Basic = £65k
NI = £7937
Employee costs (eg. training, software, hardware) = £2000 say
Apportionment of business costs = £1600
Paid holiday
Sick days

--> Actual cost per year £109282 = £420 a day

If they aren't prepared to pay the going rate, then you have two choices - suck it up, or leave.

If you're going to suck it up, at least get a one week notice period in the contract and get looking so you can find something that is close to market rates.

[TykeMerc]

£250 a day in London is poverty rates, as mentioned even a junior PMO bod fresh from school would be on at least that.
With 5 years of PM experience any less than £450 a day in London is completely taking the mick and tbh £450 isn't good for there.

Ignore their permie assertions they're trying to flim flam you with stuff they would have to pay for as a perm employer but you get to carry as part of your day rate as a contractor.

You're being taken for a massive ride, either get out of there or get a proper paying permie role at a sensible salary and benefits package.

[TheFaQQer]

perhaps that they feel they can replace me with a 65k p/a perm PM?

If they do, it'll cost them a hell of a lot more than £250 a day (see above)

[JRCT]

I would say that £250 a day equates to around £40k perm. There're lots of opinion on this, but if you're worth £65k as a permie and you want to continue working there, ask them to offer you a permanent role at £65k.

[Pondlife]

£247 per day is not a £65K salary by a loooooong shot.

247 x 5 x 52 = £65K(ish) therefore it's not comparable to a contractor situation

Explain to them that their comparison doesn't include;
Employers National Insurance - The quoted salary doesn't factor this in.
Holiday Pay - You don't get paid for time off
Sickness Pay - You don't get paid for time off
Training costs
Pension.
In addition to any other costs associated with being a contractor (accountancy/umbrella costs etc)

They are taking the p1ss. Sorry to say this.

[avgjoe]

Thanks for all the replies so far...

Their other view is that I am on a longer term contract (6 months, expected to renew to 12) and seen as a core part of the staff... in other words, almost a job for life type thing. I understand some part of them as we have a good working relationship, but then having 2 weeks notice negates that altogether.

My initial response was to renew for a few months only in order to get my ducks in a row for a new opportunity...

[GlenW]

You are being well and truly shafted. Start looking elsewhere now for a rate at least double what they are offering.