Negotiating Rate Rises

**threaded** · 31 July 2005, 13:37

Get yourself a new contract at hopefully that higher rate. You've asked, they've turned you down.

**SandyDown** · 31 July 2005, 13:57

I don't think you should involve the employer, your contract is with the agency, if I were you I'd negotiate nicely with the agency, tell them that other contractors are getting paid more, tell them you have other expenses etc, if the employer wants to renew your contract then they'd be stupid not to negotiate a rise with you.. howerver, normally the agencies will not cut their margin they'd just ask the employer for the rise (which clearly they have refused), but in this case you need to negotiate that the agency lower their margin.... you wont lose anything by trying, and negotiating nicely , if you fail.. just move on to another contract, we all had to learn this way.

**tesla** · 31 July 2005, 14:37

Normally, do agencies discuss their margins with contractors?

Do I have a right to know what they charge the employer for me?

Regards

**malvolio** · 31 July 2005, 15:06

In a word, no. What you get is betwen you and the agency, what they get is between them and their client (emphasis on 'their' in this context). If you start to worry about the difference you will only be creating grief - the attitude is to get paid what you want and not worry about the rest of the food chain.

That said, most of us work out what the margin is, and many agencies will actually be open about it if you ask them. At renewal, they won't get more from the client (Why should they? It's not a reward scheme or anything), so all you can do is ask for a larger slice of the margin on the basis that their hard work has been done in setting up the original contract.

You may get lucky, usually you won't. If the money is important, go look for a new contract. Either way, do not get cut up about what you get or what other people get.

**SandyDown** · 31 July 2005, 17:04

Originally posted by malvolio

Either way, do not get cut up about what you get or what other people get.

This may be the best advice anyone can give (which is really really rare on this board btw..) yes don't worry about what others get paid, negotiate your rate, if you fail to get the raise, either be happy with what you get, go on with the work as usual, or find another contract and just move on........

**thunderlizard** · 31 July 2005, 20:45

"have spoke to the employer" - hey people, less of the E-word please! Customer/Client if you don't mind!

First the basics - usually the agency doesn't want you or the customer to know what their margin is, because as long as they are the only party who know all the facts, they have more negotiating power. But most of them are sensible enough to accept that if either you or the customer want to find out the margin, you will be able to. 9 times out of 10 the customer will be happy to play "you show me yours, I'll show you mine"

.

Unless the margin's really massive (say 50%) don't worry about it too much. Presumably you signed the contract of your own free will (Matthew 20 & all that).
You say you went in at the lower end of the rate range - which is no bad thing if it gets you the job - so yes it's likely that the agent is pocketing most of the difference.

Furthermore, call me cynical but what I suspect is happening in your case is:
(1)the agency has passed on your request for a rate rise to the customer.
(2)the customer has agreed and started paying the agency more
(3)the agency hasn't told you and is still paying you the same.

So I suspect the margin could be sizeable in your case - which is blessing because it means there could be more cash in the system than you thought.

Get out of the employee frame of mind, where you politely ask for a pay rise and the employer decides. Think more like a shopkeeper - put the price up and tell the customers when you're going to do it. Of course for this to work, you need to be confident about your prices, and be happy about your current customer not renewing.

If you're going to raise your price, it's always best to get the customer on side first, even if you don't actually name the figure with them.

Good luck though,

tl

**Rebecca Loos** · 1 August 2005, 08:57

what I would add as well is that it depends a lot on your negociating skills - a bit like when you are shopping in a middle-estern country, you bargain and haggle a lot!

If you are likely to be renewed, then it means the client likes you. That puts YOU in a strong negociating position. Talk to your agent and say that you wouldn't mind staying but you have been offered much more money elsewhere. So you'd be happy to stay but you don't want to lose out too much financially and therefore you will only stay if you get a bit of a rise. It usually works with agents, in fact all my rate rises have been achieved like that, and I just got one like that last week. If they feel you are serious and they might lose a contractor on site, they will be that little bit more accomodating, especially if they are making a lot of money out of you as it is.
You got nothing to lose, even if they call your bluff, stay at the same rate, they won't hate you for it, it's a kind of game and everybody plays it, nothing personal etc.

Good luck

**n5gooner** · 1 August 2005, 09:50

so what sort of % do people look for on a rate rise, or is it more an extra £5 - £10 ph ?

**rootsnall** · 1 August 2005, 11:35

I'd find out your margin asap, if the agent is taking a bigger cut from you than your contemparies and thats why your rate is lower then you are in a good position to get your rise out of the agent. Can the agent replace you at the same rate ? Is the agent the sole supplier ? Whatever the figures you have to be prepared to play hard ball and convince the agent you will walk if they don't pay you more. Just asking isn't normally enough. Are you prepared to do this and have to sweat on things ? Can you get another contract elsewhere at the rate you are after ?

Negotiating Rate Rises