Contract negotiation query...

[avgjoe]

Hi all

I am a contractor on a long term contract with a company. I am operating under a limited company setup and flat rate VAT scheme.

I am being offered (on the latest renewal) a 5% raise to £250 p/d for an intermediate (more than 5 yrs) IT proj manager role in London.

I feel that this is quite a bit lower than market rates at the moment, but they insist that they have benchmarked my daily rate against someone who earns around 65k per annum (perm salary).

I've looked at so many calculators but can't seem to come a conclusion. Using hourly rate x1000 I am way under (30K). Using day rate x 240 I am on 59K (which is better I suppose). But, how come average PM rates are so much higher than? I've had a few agents tell me I am under-paid here, but not sure if they are to be trusted.

No mortgage (desperate to get on though), married with missus in a v stable perm job and no kids...

Just wanted to get different viewpoints from folks here?

TIA

[SpontaneousOrder]

someone who earns around 65k per annum (perm salary).

But you're not perm, and don't get perm benefits, right? So you probably are underpaid.

[SpontaneousOrder]

Infact 65k is $250 per day assuming you don't take ANY holiday.

[avgjoe]

Infact 65k is $250 per day assuming you don't take ANY holiday.

Which then implies that they are correct with their offer and not being cheapo's?

[avgjoe]

But you're not perm, and don't get perm benefits, right? So you probably are underpaid.

No perm benefits, 2 week notice period...

[SpontaneousOrder]

Sorry for the multiple posts...

But, how come average PM rates are so much higher than?

Because contracting you tend to turn over at least double the perm salary equivalent - unless you live in London on a fat permie salary to start with. If you didn't, what's the point in taking on the risk with no reward (other than avoiding the politics etc) ?

[SpontaneousOrder]

Which then implies that they are correct with their offer and not being cheapo's?

It implies you're being mugged (assuming you're competent / market is decent etc).

[tarbera]

What's the permie benchmark got to do with you ? It's a tulipe rate for a trainee PMO straight from high school in Doncaster - never mind a project manager in London

Why don't you just apply for a 6 month role for £600 a day ? Somewhere else

[avgjoe]

It implies you're being mugged (assuming you're competent / market is decent etc).

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?

[avgjoe]

What's the permie benchmark got to do with you ? It's a tulipe rate for a trainee PMO straight from high school in Doncaster - never mind a project manager in London

Why don't you just apply for a 6 month role for £600 a day ? Somewhere else

This is my intention, just on here to get other opinions and see what the consensus is...I dont know how the permie thing relates, perhaps that they feel they can replace me with a 65k p/a perm PM?