£39k to £30/hr contracting, what do I do?

[CrispSandwich]

Hi everyone,

Looking for a bit of advice so thought I would post in here. Currently I am working for a tier 1 automotive supplier working as a Systems Engineer, and have been in the role for just over 2 years with 2 years previous as an Analogue Design Engineer. The role I work in is fine, but the company direction isnt looking too good. There is a lot of restructuring and outsourcing going on, and in a few years I wouldnt be suprised if they close the UK facilities completely.

I am currently earning £39k base salary with a bonus which after pension, childcare vouchers and student loan leaves me with about £2k take home pay. This is due to increase to £42k next July. There have been redundancies every year and the payout for me would be approx £20k tax free. This is announced 2nd week of December when the job market is very quiet and I tend to get interest in my CV around March which is too late. I have a fiance due to go on maternity leave for the second time and the extra pay contracting would make a big difference to our lifestyle as she is only entitled to statutory maternity pay.

I have another automotive supplier interested in a contracting role advertised as £45k permie or £30/hr contractor which is the standard x1500 rule but the values I get for take home pay estimates vary wildly! What could I realistically expect with 400 miles a week commuting? What would you recommend to someone in my position?

Thanks,

[stek]

Hi everyone,

Looking for a bit of advice so thought I would post in here. Currently I am working for a tier 1 automotive supplier working as a Systems Engineer, and have been in the role for just over 2 years with 2 years previous as an Analogue Design Engineer. The role I work in is fine, but the company direction isnt looking too good. There is a lot of restructuring and outsourcing going on, and in a few years I wouldnt be suprised if they close the UK facilities completely.

I am currently earning £39k base salary with a bonus which after pension, childcare vouchers and student loan leaves me with about £2k take home pay. This is due to increase to £42k next July. There have been redundancies every year and the payout for me would be approx £20k tax free. This is announced 2nd week of December when the job market is very quiet and I tend to get interest in my CV around March which is too late. I have a fiance due to go on maternity leave for the second time and the extra pay contracting would make a big difference to our lifestyle as she is only entitled to statutory maternity pay.

I have another automotive supplier interested in a contracting role advertised as £45k permie or £30/hr contractor which is the standard x1500 rule but the values I get for take home pay estimates vary wildly! What could I realistically expect with 400 miles a week commuting? What would you recommend to someone in my position?

Thanks,

It's would be 100% inside IR35 so no claimable travel expenses, so looks like you'd be worse off.

[CrispSandwich]

Why would it be 100% IR35? I know plenty of contractors doing the same while being outside IR35, they say its all about the wording in the contract and if the company accepts this? Or am I completely wrong?

[TheFaQQer]

What could I realistically expect with 400 miles a week commuting?

A lot of pain, misery and heartache when you leave your baby every Monday with your wife, and only turn up on a Friday night. This is particularly exaggerated by having a winter baby - there's much less chance for your fiance to get away from the crying, vomiting, hungry, needy baby when she needs to because it's not like she can go to the park in the sunshine to get some air and a break. Unless she has a good support network around her, expect to be given the baby as soon as you walk through the door on a Friday night, deal with a tired and emotional partner, a new baby all weekend, and then get in the car first thing Monday morning and repeat for a few months.

What would you recommend to someone in my position?

That you get a role as close to home as possible. I've been through this - if you work away all week then it will put a strain on your relationship even more than a new baby will do. I think you'd be absolutely crazy to do it, no matter how much money might appear to be on offer.

[eek]

It's would be 100% inside IR35 so no claimable travel expenses, so looks like you'd be worse off.

Technically its not inside IR35 but it should be and if the public sector rules were applied it would be so its not something I would take.

What about going there on a permanent basis and moving your family there given the on-going fears regarding your current job?

[MrButton]

There are so many things to consider - I know nothing about your sector but based on the numbers id say not worth it... you may be a bit better off (if outside IR35) but not enough.

Especially with a baby due - milk the perm benefits or find a contract for more money...

[uk contractor]

Stay where you are OP until next year or volunteer for redundancy in December to get your £20K then find a new job in Jan. Wait until you have your baby (hope it all goes well BTW) & things settle down at home after that. Even if you get something today you are on 1 months notice most likely so that means you cannot start until mid Oct. A lot of contractors get told to stay home for 2-4 weeks in December so its not a very billable month as many companies shut down for several weeks & do not want or need contractor services in that time. The differential in pay is not worth the extra hassle & loss of job security especially if your waiting on another child to be born.


Also 400 miles a week commute will put tremendous strain on you personally over time I would need double the rates you mention to even consider it as your work-home life balance will be seriously under strain just from the issues with commute times in the winter alone & the lack of quality time with your family will make you personally unhappy at times & put a strain on work relationships.


If you really have to take the £45K perm offer not the £30PH as then no IR35 to consider at least its slightly more money & safe from IR35 issues.

[stek]

Technically its not inside IR35 but it should be and if the public sector rules were applied it would be so its not something I would take.

What about going there on a permanent basis and moving your family there given the on-going fears regarding your current job?

But if it's permie or contract wouldn't that mean the contract option is essentially disguised employment? I'm out of the loop a bit so I'm open to admitting I'm talking balls....

[northernladyuk]

Hi everyone,

Looking for a bit of advice so thought I would post in here. Currently I am working for a tier 1 automotive supplier working as a Systems Engineer, and have been in the role for just over 2 years with 2 years previous as an Analogue Design Engineer. The role I work in is fine, but the company direction isnt looking too good. There is a lot of restructuring and outsourcing going on, and in a few years I wouldnt be suprised if they close the UK facilities completely.

I am currently earning £39k base salary with a bonus which after pension, childcare vouchers and student loan leaves me with about £2k take home pay. This is due to increase to £42k next July. There have been redundancies every year and the payout for me would be approx £20k tax free. This is announced 2nd week of December when the job market is very quiet and I tend to get interest in my CV around March which is too late. I have a fiance due to go on maternity leave for the second time and the extra pay contracting would make a big difference to our lifestyle as she is only entitled to statutory maternity pay.

I have another automotive supplier interested in a contracting role advertised as £45k permie or £30/hr contractor which is the standard x1500 rule but the values I get for take home pay estimates vary wildly! What could I realistically expect with 400 miles a week commuting? What would you recommend to someone in my position?

Thanks,

Don't move for 30 quid an hour. How are you going to build a war chest to survive a 2 to 10 month gap between contracts. I'm not in your line of work, but is that really rate for contract work?

[CrispSandwich]

Ok just to clarify a few things, Im not massively keen on the position and the current timing is pretty terrible. I am just trying to work out a realistic figure I could earn if I remained outside of IR35 for 2 years or so then transferred to permanent.

Senior management at my company are quoting for a big OEM in West Midland (JLR) and want me to work on site in Gaydon (well they havent told me directly but this is what I have heard), which is about 30 minute commute.

The contracting position, while based in Derby is also a resident engineer role for another OEM (Aston Martin) on the same site in Gaydon and while I would be driving to from Solihull to Derby 3 times a week eventually I would have the same 30 minute commute. Moving to Derby as a permie isnt really an option for a £5k pay bump with a house to sell etc.

I also have interest from another supplier in Solihull which I could cycle to at £45k permie which is my number one choice really until the kids are in school, 2nd baby is due April 2018