Contract extensions and rate rises

**northernladuk** · 4 December 2018, 20:25

We get asked exactly the same question almost weekly and it's the same answer so have a look through all these posts. You'll find your answer and a lot more useful information in there.

rate rise site:forums.contractoruk.com - Google Search

**Old Greg** · 4 December 2018, 21:12

Originally posted by ChristyP View Post

Hi all,

My contract is coming to an end on the 31th of December 2018 - I have just been granted a 3 month extension.

A little bit of background - I was initally supposed to be on this contract short term for 2 months since May but each time they have extended as they are happy with my work - in total I have had around 3 extensions now.

My question is, I want to ask for a rate rise. Do I ask the client direct as I have a good relationship with them or do I tackle the agency? I have been able to found out that the client is paying 400 a day for me and the agency initially paid me 350 a day but when I found out I managed to get them to 375. Do you think I am able to get the full 400 or will that leave the agency with no commission for themselves?

I am tempted to speak to the client direct - as previously the agency were extremely difficult to negotiate with. Any tips?

Thank you!

If the agency is only making 25 quid per day, you have no complaint with them. Your question should be whether you can get the client to pay more, still going via the agency.

**doconline** · 5 December 2018, 10:05

Originally posted by ChristyP View Post

Hi all,

My contract is coming to an end on the 31th of December 2018 - I have just been granted a 3 month extension.

A little bit of background - I was initally supposed to be on this contract short term for 2 months since May but each time they have extended as they are happy with my work - in total I have had around 3 extensions now.

My question is, I want to ask for a rate rise. Do I ask the client direct as I have a good relationship with them or do I tackle the agency? I have been able to found out that the client is paying 400 a day for me and the agency initially paid me 350 a day but when I found out I managed to get them to 375. Do you think I am able to get the full 400 or will that leave the agency with no commission for themselves?

I am tempted to speak to the client direct - as previously the agency were extremely difficult to negotiate with. Any tips?

Thank you!

I'm not usually on the agents side, as I rate them down there with estate agents, but I can understand why they were difficult to negotiate with. They were taking 12.5% of the contract value and have dropped that to 6.25%, which is a very good deal for you and a pretty bad one for them. If you know the client is paying £400, why would the agency agree to giving you the full rate when they have overheads / invoice factoring (possibly) etc to take into consideration, unless they have so many contractors with the client that they are making money from and the client can somehow exert pressure on the agent or want you in there as some sort of loss leader?

As Old Greg said, your best bet is going to the client and getting the rate increased.

**psychocandy** · 5 December 2018, 11:55

Originally posted by ChristyP View Post

Hi all,

My contract is coming to an end on the 31th of December 2018 - I have just been granted a 3 month extension.

A little bit of background - I was initally supposed to be on this contract short term for 2 months since May but each time they have extended as they are happy with my work - in total I have had around 3 extensions now.

My question is, I want to ask for a rate rise. Do I ask the client direct as I have a good relationship with them or do I tackle the agency? I have been able to found out that the client is paying 400 a day for me and the agency initially paid me 350 a day but when I found out I managed to get them to 375. Do you think I am able to get the full 400 or will that leave the agency with no commission for themselves?

I am tempted to speak to the client direct - as previously the agency were extremely difficult to negotiate with. Any tips?

Thank you!

Why would the agency give it all to you and make nothing out of the deal?

**malvolio** · 5 December 2018, 12:32

The other and rather more crucial question is what have you done for the client to warrant them paying you more? Civil Servants get pay rises for sticking at the job; since we aren't civil servants, or even employees, we have to justify them on the grounds of either increased value to the client or some substantial change in YourCo's overheads.

I also agree with the others: the agency is a business, not a charity.

**washed up contractor** · 5 December 2018, 14:21

Love these sorts of threads! The naivety of some is a beauty to behold.

**northernladuk** · 5 December 2018, 14:24

Originally posted by washed up contractor View Post

Love these sorts of threads! The naivety of some is a beauty to behold.

Indeed but they do vary. Have to say that 'Do you think I am able to get the full 400 or will that leave the agency with no commission for themselves? ' takes the prize though

**Old Greg** · 5 December 2018, 22:12

Originally posted by northernladuk View Post

Indeed but they do vary. Have to say that 'Do you think I am able to get the full 400 or will that leave the agency with no commission for themselves? ' takes the prize though

Maybe the agency could take 400 per day and leave the contractor with nothing.

**ChristyP** · 5 December 2018, 22:49

Originally posted by malvolio View Post

The other and rather more crucial question is what have you done for the client to warrant them paying you more? Civil Servants get pay rises for sticking at the job; since we aren't civil servants, or even employees, we have to justify them on the grounds of either increased value to the client or some substantial change in YourCo's overheads.

I also agree with the others: the agency is a business, not a charity.

The client is aware of my value and I have helped the business during a crucial time.

We aren't civil servants or employees but we do run a business and its all about the revenue that we generate. If my contract has been extended multiple times and I am not receiving the market rate then I have every right to ask. From my understanding its a very common occurence in the contracting industry. Don't ask don't get.

Contract extensions and rate rises