Contract Advice Required

[Dave Spring]

Hi

New to these forums, but been lurking a while.

I have recently been offered a new contract but been requested to lower my rate. Given the current market situation I will renew but need to decide on how much of a reduction - they've asked me to propose a new rate.

I guess this has happened alot recently so was wondering how much of a cut other people are taking?

Cheers

Dave

[badger7579]

Do you have a new contract or a renewal? Who has "requested" you lower your rate client or agent and why?

Sounds like the agent may be trying to pull a fast one in most situations they will tell you to take a x% rate cut or walk.. Why do they want you to tell them what rate reduction you should have?

[Dave Spring]

Its the client coming to me directly - the agency are not involved yet.

Dave

[jmo21]

no harm asking the client to find out if it has came from them.

also, if its really about the money, offer to do a 4 day week on your current rate? (assuming that works out well for you!)

ie. day rate of £320 over 4 days = £1280
day rate of £256 (20% off of £320) over 5 days also = £1280

[Turion]

no harm asking the client to find out if it has came from them.

also, if its really about the money, offer to do a 4 day week on your current rate? (assuming that works out well for you!)

ie. day rate of £320 over 4 days = £1280
day rate of £256 (20% off of £320) over 5 days also = £1280

WHS. Probably an agent wanting to skim a lot more off you. A 10% cut by you increases his profit from you massively. You must ask the client about this. If, and only if the client insists on a reduction and the renewal is at risk, offer to reduce hours as already suggested. In this way you do not devalue yourself, and at gain more freetime. Everyone stays

[Dave Spring]

It is the client who has proposed the rate cut to me, not the agent.
The agent was a bit surprised when I mentioned it to her.

[BolshieBastard]

I dont know of any client looking for a rate cut agreeing to a contractor working the same rate for fewer hours. They want a reduction in headline rate so imo, talk of reduced hours wont wash.

Tell them you'd agree to a 5% cut for this contract period only and would expect to revert to your previous rate for any further extension.

[HeliCraig]

If it is the client coming straight to you then you at least know it isn't the agency trying to pull a fast one!

I would suggest that you tell them you expect the agency to also take some cut out of its margin also. Perhaps suggest matching any cut in their margin (in % terms, not £), upto a maximum of 5 / 10 %; but only for this contract.

You could also try and protect yourself from them pulling a fast one by inserting a term to the effect that if they end the contract early for any reason then the reduced rate no longer applies and any hours worked in previous X period (or even whole contract to date) must be repaid at the full old rate.

Worth a punt!

[NotAllThere]

Suggest working fewer hours at the same rate. Perhaps for a longer period. (E.g. instead of 5 days a week for three months, 2.5 days a week for 6.) Then you can pick up other work.

[Dave Spring]

Thanks for the advice guys - much appreciated.

I think I will offer a small rate cut (5%) for th 6 months on offer (new contract so will not affect my current rate which ends 31st Dec) but request a longer contract.

I will also suggest they try to get a 5% cut with the agency as well.

Dave