Asking for a rate increase on contract extension?

**SlipTheJab** · 30 March 2015, 11:17

Originally posted by yasockie View Post

My contract extension is coming up in a month or so.
This has already been approved by the end client so happy times.
I know that the agency is enjoying milking a healthy margin off the top across not just my role but also many others.
I am nearly convinced I should ask for a rate increase, mostly because I have better skills, experience and alternative offers now. The end client (and the industry) is also known for rate cuts across the board so this is also to pre-empt that.
Can you guys encourage me? Is a 5% increase reasonable or is that too little?

How long have you been there, 3 months? 6? I tend to (if I am still there) negotiate increases on a yearly basis, last time I asked for 10%, they countered with 2% and stated that was the most they could do. I thanked them for their offer and refused the extension. A week later they came back with 7% which I agreed to. You have to be prepared to walk if you don't get what you want otherwise you have no bargaining power in the future.

**northernladuk** · 30 March 2015, 11:37

5% of sod all is still sod all. Why not do it in pounds instead?

Be prepared to walk though. Agents do this day in day out so they can spot a Chancer a mile off. IMO using the knowledge you have gained at the clients as a reason for a rise is bad form. That's what you were brought in to so taking them over a barrel just because you carried out your duties doesn't sit right with me.

Do you know how much they agent is taking? Have you asked him if he is on a fixed margin yet?

**kaiser78** · 30 March 2015, 19:53

I did this today funnily enough - told clientco I would like extension at renewal next month (with valid reasons why), stressing that I won't walk if they so no, but would like them to see what they can do.

Have successfully tried this approach before and works better than the "take it or leave it" approach.

**uk contractor** · 31 March 2015, 08:55

Ask the agency not the client to avoid upsetting them but be aware whatever you do they are 100s of capable contractors out there right now so do not overplay your hand!

**vadhert** · 31 March 2015, 09:44

Interestingly I found out our agent here has been asking for rate increases to the end client and not passing them on.

Naughty naughty

**SteelyDan** · 31 March 2015, 10:09

Originally posted by northernladuk View Post

IMO using the knowledge you have gained at the clients as a reason for a rise is bad form. That's what you were brought in to so taking them over a barrel just because you carried out your duties doesn't sit right with me.

^ This.

Ignoring any agent margin (mine are on a low fixed rate anyway) IMRE, the client will only pay what they consider to be a reasonable rate for the work, but in some cases are prepared to compensate this by offering longer extension periods (i.e. instead of another 3 months, for example, they might offer a 6 monther [yeah we all know the contract length is only as good as its notice period, but they don't get this]), and are not interested in what the market rate indicators might tell anyone...these are a bit like share prices & have a habit of fluctuating +/- so using these as part of any justification is not a great idea...

**psychocandy** · 31 March 2015, 10:18

Agencies will pull all sorts of tricks.

I had it once. Knew the agency was on an excessive margin. Tried to get an increase out of this etc. Discussed that I knew the score and that lets get this sorted but leave client out of it.

So what did agent do? Go straight to client and tell them I'd told them raise or Im off. Of course, client already paying well over the odds due to agency huge margin just thinks - greedy bugger.

**psychocandy** · 31 March 2015, 10:19

IMHO 99% of clients will never pay for an increase. Rate at the start is rate forever in their heads.

**TheLordDave** · 31 March 2015, 11:52

Try getting one from capita, like blood from a stone, a very slow rolling stone that doesn't reply to emails.

Asking for a rate increase on contract extension?