Aviva Contractor Shake-Up - All Out Within 60 Days + Rate Cut of 10%

[lukemg]

Had this once at b bank, client manager had been struggling to populate the team so pushed to exempt us from it, which was nice. Got pushed in a cull 2 months later with 8hrs notice...oh well such is contracting.
I have no prob with a chat at end of contract but half way through is a kick in the spuds, I am surprised they do this as it causes huge bad feeling.
I would still work at the expected level but you could forget any over and above. I would also have no qualms walking if I got another offer.

[redgiant]

I think contractors are sheltered from the usual butcher’s cleaver when it comes to cost reductions. Contractors by in large IMHO tend to avoid the aggressive contract cost savings deals usually as it's easier for the clientcos to get out of a contractors contract (as it’s usually 3-6 months duration rather than 3-5 years for outsourcers) they will pay the rate you agreed until renewal time which is fair enough. As NL mentioned outsourcers are under huge pressure ATM to reduce their costs year on year - I spent three months last year negotiating with one of them to reduce their costs for the clientco. Typically it involved moving their support resources to an even cheaper location such as Kuala Lumpur, reducing headcount and making their SLAs less strict.

Other types of B2B suppliers have it far worse … look at the milk industry for example and how they are getting squeezed (pardon the pun!) by the supermarkets by lowering the selling prices and therefore cutting the margins for the milk supplier.

[northernladuk]

And, I know NLUK is probably going to have a dig at me about being professional etc but current client gets at least 10% extra out of me (extra time/effort) as goodwill at the moment (client is crap but local manager is a decent fella).

I thought you had finished with that client after the last one month extension thread you started... Or did you cave and go back?

And it is up to us as businesses to make the decision which is right for us. Leave, stay, kick up a stink to stop your rate being cut, work to rule, agree to the cut.

Any of these options are correct, depending on what you think you can get from it. You may be proved right, you may be proved wrong.

Agree with this. I do think acting like a disgruntled employee is not the way though.

[psychocandy]

Yes, I know there's a squeeze on but sometimes the client lays on the sob story a bit too thick sometimes.

At the end of day, like people always go on about here, we all run our own businesses and have got to look out for ourselves.

All well and good to have an understanding of the situation but if a client is moaning that they cant afford to pay me then, to be perfectly honest, I really dont care. If they want to get someone cheaper - up to them as its up to me to go somewhere else.

Had a strange conversation with an agency recently. Contract £150/day with a local council. I was polite and said no thanks but that was nowhere near my rate.

Then the guy tries to tell me that its a council, they can't afford much, its the public sector, its helping out the local area, they need someone good (BTW - the list of skills they wanted could command 4/5x that rate in the South East). Hang on a minute - OK then I feel sorry for them I'll do it. NO THANKS - I DON'T REALLY CARE.

[psychocandy]

I thought you had finished with that client after the last one month extension thread you started... Or did you cave and go back?.

Nope. Didn't cave. They did.

[Wanderer]

I'm not staying if I'm expected to absorb the 10% rate cut.

Rightly so too. I've fought rate cuts in the past and won but it was a bloody battle. Bugger all point arguing with the agency, they are just doing the dirty work for the client. Best thing to do is talk to the client and negotiate that way.

If you lose then insist that they put you on 1 week notice so you can find a new gig.

Good luck

[psychocandy]

Rightly so too. I've fought rate cuts in the past and won but it was a bloody battle. Bugger all point arguing with the agency, they are just doing the dirty work for the client. Best thing to do is talk to the client and negotiate that way.

If you lose then insist that they put you on 1 week notice so you can find a new gig.

Good luck

Hmm. To be honest, I dont like getting into arguments with the clients - thats agents job.

A few months ago client offered a one month extension to me but still refused to change the notice period from a month (what the point in that?). Great eh?

I took that one but refused the next one and got it sorted. We'll see what happens in the next few weeks..... (not helped by xmas in the middle).

[Swamp Thing]

I don't agree with this at all. If we want to be treated like and act like businesses we have to take pressure to deliver for less.

I don't entirely agree with this - needs to be balanced with the concept that to act truly B2B you sometimes have to push back.

If a rate cut is proposed, then the engagement model has to change in some manner - otherwise the agreed rate remains the same. If all fails you have to be prepared to serve notice and walk. Other small businesses wouldn't be chipped away. Talk to a plumber, electrician, garage etc etc. They would not have this kind of conversation, or at the most would provide an alternative spec. Even though the contractor's core supply is their intellectual know-how, this shouldn’t be treated any differently to other trades.

Speaking with a previous client, he felt that because a contractor's service is that slightly intangible, unquantifiable thing, contractors were (in his opinion) more exposed to potential rate cuts. But no, if it came to the plumber, he'd have to accept the quote given. There's a disconnect here, not helped by the contractor wobbling too quickly and not standing ground. That client proved that tacit acceptance of unprofessional behaviour encourages more of the same.

I nearly started a gig at BarCap last year; quick onboarding process right up to the point where in the week before start of services I was informed that BarCap 'miscalculated its consultancy budget' and that I'd need to take a 10% haircut. We discussed, there was no movement in rate or deliverables; ultimately I declined, we parted professionally. I took a risk and it put me back at square one, but for me it was important to do this. As a small business, you have to be fully prepared to influence client behaviour to your good, not always theirs.

[northernladuk]

I don't entirely agree with this - needs to be balanced with the concept that to act truly B2B you sometimes have to push back.

If a rate cut is proposed, then the engagement model has to change in some manner - otherwise the agreed rate remains the same. If all fails you have to be prepared to serve notice and walk. Other small businesses wouldn't be chipped away. Talk to a plumber, electrician, garage etc etc. They would not have this kind of conversation, or at the most would provide an alternative spec. Even though the contractor's core supply is their intellectual know-how, this shouldn’t be treated any differently to other trades.
<and the rest of the stuff>.

You are right and we are on the same page. I said we had to take the pressure to deliver for less. I didn't say we had to roll over. When a client is looking to cut costs, particularly from his suppliers we have to be aware we are a supplier as well so not exempt from attempts from the client. By being a business we have to be part of the supplier group, not a separate group of contractors which won't help our business tests (but that is another long thread for another time).

[fraymond]

Dont get me wrong I can see how people accept it. 90% of rate is better than 0% of rate if you aint got something else....

Well, personally I found out that logic doesn't work for me. I was at Barclays when the forementioned rate cut was handed down. After a month being there, I took 10% on the chin. It wiped off a lot of goodwill but I decided to just try and make the most of things. Then I took 2 more cuts before being asked to become a perm or have noticed served. The whole thing was very unsatisfactory and in the end I left anyway with a sour taste in my mouth (even though everything was done by the book strictly to the contract). Now once a client has "shown its spots" in this kind of manner, it's not the spirit I entered the contract initially with, so I just ask for immediate notice to be served on the first mention of a cut. Often an exception is made anyhow.