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Fixed Term Contracts - what lunatics work on these ?

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  • dangerouswhensober
    replied
    And did I forget to mention the pension contributions ?

    When I was an FTC, the hiring company had to treat me as a permie - which meant I was enrolled into their pension fund - to which they made their statutory contributions each month.

    At the end of four years, I just transferred all their contributions into their company fund into my main pension fund.

    So I'd say to anyone who "looks down" on an FTC - it isn't a simple comparison - as the OP pointed out ...

    Leave a comment:


  • dangerouswhensober
    replied
    Originally posted by IsaacD View Post
    I've done around 15 years of outside ir35 contracts, but I'm currently in a FTC, it's not a straightforward FTC bad, contracts good situation. The ir35 rules have changed the equation somewhat.

    Positives of a FTC -
    1) you should be able to negotiate yourself to the top of the salary band for the role you're in. It's an easier negotiation precisely because it's a FTC and less of a long term commitment from the client's point of view. The bands are often quite wide, I'm in a lead role and think I'm getting approx 15k more than I would expect for the same permie role.

    2) Short notice period - as a permie in a lead role, I'd be on 3 months' notice. As a FTC, it's one month. This is in my favour if I see a better contract role elsewhere as it gives me a chance of getting it without having to negotiate a reduced notice period. Obviously this is true for both sides, but if you're overly worried about being binned by the client at short notice, then as the saying goes "you're not cut out to be a contractor".

    3) Training/Flexibility. You get all these, as they are legally obliged to treat you the same as a permie. So 4 days a week, say, or weird hours and you've a better chance of being successful. Also it's easier to weedle your way into a project/technology you can see as an opportunity.

    Financially, my view is it's broadly similar to an inside ir35 gig, as long as there's a decent company pension contribution and reasonable holidays/sick pay. Plus they can't force you out for a month over christmas.

    Downsides - you have some permie nonsense to deal with but if you have a bit more wit than a halfwit you can manage this.
    I've only one experience but the renewal process is also more difficult because permie managers aren't always good and knowing how long it takes and/or the sign-off involved. It's not the usually better understood headcount process or Purchase Order and Agency process.

    So in summary, as you'd expect, don't rule it out until you've fully considered the possibilities
    You forgot the "sickies"

    A while ago I did a four-year FTC and threw about 10 (ten) sick days each year (in 230 working days each year).

    Permies get paid for days off sick, and contract prozzies don't - they just lose a day of billing for each day off sick.

    So taking an FTC - where you must be treated the same as as a permie - will give you extra time off - as long as you don't abuse it or make it too obvious ...

    (And don't even get me started on the redundancy settlement I got at the end of that FTC - enough to send me to exotic locations for a whole year ... :-))

    Leave a comment:


  • rocktronAMP
    replied
    Originally posted by ladymuck View Post
    FTC is just another way for a client to procure temporary resource for a defined period with probably a one-off payment to an agency rather than an ongoing fee for monthly payment processing. If the term lasts beyond two years you become a permie, with redundancy rights IIRC, so there's an incentive for the client to not let things run indefinitely.

    There are many reasons why a client chooses FTC over Perm, such as not wanting to show the headcount on their books, project work they want to retain control over, trialling something within an organisation that may convert to perm if it works out, not wanting the administrative hassle of IR35 compliance, etc.

    CORRECTION: After two years you "may" be entitled to redundancy pay and after four years you "may" become permanent.
    Source: https://archive.acas.org.uk/index.aspx?articleid=4587
    And to add to the good lady's information, please consider the B2B relationship.

    1) If the FTC is with the client, directly, then you have the same advantages as a permanent employee (protected by legal laws), but there is a end termination definite date.

    2) If the FTC is not with the client, then your mileage will vary.

    Consider any big name high street Bank, you name it, then 2) is much easier to continence, because you are FTC with a PAYE solution (employment agency) and so the training opportunities are with them and not Client Co. Also, if the client co is not happy with your productivity then they will give client co a call and then agency will bin you (1 month notice). Finally in 2) you may paid salary in 1 or 2 months arrears, because the bank, first, has to payroll the agency for then payroll to pay Peter, Jane and Paul.

    In a nutshell, because big bank is much larger legal entity than small employment agent usually 1) is much better politically, structurally and powerwise than 2) IMHO

    So good luck to you

    Leave a comment:


  • IsaacD
    replied
    Originally posted by JohnM View Post

    I think you are trying to kid yourself with the 15K more comment, trust me NONE of the FTC on jobserve or total jobs I have seen are anything iike 15K more than perm, most almost identical to similar perm roles
    Generally I don't get roles from job boards, this one was with people I've worked with before, there's more room for negotiation there. It's definitely not a zero hours contract, since there's notice (unlike an inside/outside ir35 role where mutuality implies no notice), but I'm not sure you understand the subtleties.

    Leave a comment:


  • velcro
    replied
    Agreed. Permies at least have the belief that they may be at the same company in a year or two. If not there could possibly be a redundancy payout.
    As contractors we're pretty easy with the lack of job security but there's loads of people who can't cope with it.

    Leave a comment:


  • PCTNN
    replied
    Originally posted by velcro View Post

    Other than that, FTC's are the worst of both worlds: low rate plus no security.
    This is what puzzles me.

    No jobs have security! Contractors gets cut, permies get sacked. FTCs are just as good/bad as permanent roles. Regardless of the type of employment, the only security you have is your notice period. End of.

    Leave a comment:


  • velcro
    replied
    Personally FTC would be a fair way down my list of preferences for working arrangements (which in order would be Outside, Umbrella, Perm, FTC). I've always said I'd never do a FTC although I wouldn't be too proud or dumb to turn one down if I'd got no other money coming in.

    From a few other peoples comments here, I can see why it might be advantageous, such as getting your foot in the door with a company that you'd like to end up as permanent with, or an increased salary or responsibility. Would be interesting to see if negotiating a higher FTC rate would then lead to a higher permanent salary?

    Other than that, FTC's are the worst of both worlds: low rate plus no security.

    Quite a few companies are offering FTC's and maybe they will need to go through some pain before reverting to getting proper contractors when IR35 has all settled down.

    Leave a comment:


  • Lance
    replied
    Originally posted by JohnM View Post

    you could do exactly the same with any perm job so why do a FTC ?

    Its madness IMO and its encouraging employers to have the cheek to try and recruit more people in this way

    I look at these as the developer equivalent of zero hour contracts, very dangerous to our industry, much more dangerous that IR35 where you can still earn a decent day rate

    Asking developers to do 6/12 month FTC on £40,000 a year is a p*ss take, especally experienced guys who have previously contracted. Go perm for god sake, don't allow these FTC's to gain traction within the industry
    then you don't understand zero hours contracts either.
    HTH

    Leave a comment:


  • JohnM
    replied
    Originally posted by IsaacD View Post

    You're wrong on this, see my post at the top of page 2.
    I think you are trying to kid yourself with the 15K more comment, trust me NONE of the FTC on jobserve or total jobs I have seen are anything iike 15K more than perm, most almost identical to similar perm roles

    Leave a comment:


  • IsaacD
    replied
    Originally posted by JohnM View Post

    I have noticed a lot more than normal the last few weeks which concerns me as if that trend continues it is much worse than IR35 in my opinion

    IF people keep on accepting them more companies will do them obviously, hence the point of my thread

    Its the developer equivalent of a zero hours contact, the worst of contracting combined with the worst of perm
    You're wrong on this, see my post at the top of page 2.

    Leave a comment:

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