5 days into contract, rate cut!

[perplexed]

I really don't think agents are into swallowing any costs when they are on 2 to 3% margins. There has to be a limit where it just isn't worth it for them.

Remember the agents cut IS being reduced as well. If the bank is paying less the agents margin is also less.

Was using that as an example; my ill written point was that the rate you're on is a rate agreed between agency and contractor. What the agency charge the client is their business, any change to that is a business renegotiation between those two parties. What happens after that....

If a client are saying "contractors must take 10% cut", then that reads to me they are dictating renegotiation of contract between contractor and agent... was wondering the potential legitimacy of that and the implications. If company A engages company B to provide cleaners, can't see company A saying "Hey company B, we want to pay less, so pay your workers £1 an hour less". ( and yes, that's probably a poorly contrived example ).

EDIT:

Going back to the OP, it's ridiculous. Can understand wanting a renegotiation if for example at a small company with short term cashflow issues or if the services are no longer as required as at the start of contract, ie company reprioritising things. For the value of the services provided by the original poster to have devalued by 10% in five days is silly. I'd stick to my guns and look for another contract elsewhere. Might be me, but can't recall companies in other sectors doing the same as the banking sector seems to - and the fact so many bank try the same stunt so regularly could even indicate possible collusion?

[Wanderer]

how can Barclays dictate a 10% on your rate defined within the contract between you and an agency? If Barclays want to renegotiate their deals with agencies, that's their business; agency would obviously try to then force the cut on you... you can then choose to negotiate ( agency swallowing cut - wholly or partially - out of their margin, etc ) but I'm intrigued as to how Barclays et al seem to believe their desire to cut costs is magically your problem, that you should bend over when your contract isn't with them...

The client asks the agency to tell the contractors they are getting a rate cut. The contractual method of doing this is that the agency give you notice that they are terminating your contract and they are offering a new one at the lower rate. If you don't accept the offer then they will take this back to the client who will consider each contractor on a case by case basis to decide if they be terminated or not. The contractors who don't get a rate cut imposed on them are typically told not to disclose this to anyone else.

How it turns out depends on your value to the client and your negotiating skills..

[Dallas]

The client asks the agency to tell the contractors they are getting a rate cut. The contractual method of doing this is that the agency give you notice that they are terminating your contract and they are offering a new one at the lower rate. If you don't accept the offer then they will take this back to the client who will consider each contractor on a case by case basis to decide if they be terminated or not. The contractors who don't get a rate cut imposed on them are typically told not to disclose this to anyone else.

How it turns out depends on your value to the client and your negotiating skills..

If you are only 5 days in, what is your notice period? Mine was 1 day for the first 2 weeks, I'd exercise that, nip it in the bud, hold your rate and leave it with them. Don't believe there are no exceptions, people are negotiating increases in the background all the time, depends how good you are.

[cojak]

I always factor in a 10% increase in my day rate when I'm negotiating with banks.

[TheFaQQer]

Demand outstrips supply in my sector (JavaScript).

Therein lies the rub. Particularly this early in the contract, there's plenty of other people they could find who would take that 10% cut (and maybe still find themselves vulnerable to another cut soon).

[Unix]

You should accept it, as you are only 5 days in you have no business knowledge that is valuable and really no ammo for negotiating. If you had been there 6-12 months+ then you could reject it on the basis that if you go they would lose a lot of biz knowledge that a new contractor would take months to aquire.

[northernladuk]

You should accept it, as you are only 5 days in you have no business knowledge that is valuable and really no ammo for negotiating. If you had been there 6-12 months+ then you could reject it on the basis that if you go they would lose a lot of biz knowledge that a new contractor would take months to aquire.

+1 to that.

[speling bee]

I would be cross enough to refuse and be prepared to walk. Whether that is a sound business decision, only you can tell.

[mudskipper]

I would be cross enough to refuse and be prepared to walk. Whether that is a sound business decision, only you can tell.

WHS. Depends on the warchest though!

[speling bee]

Demand outstrips supply in my sector (JavaScript). Mind you this rate is significantly better than anything else I was offered. It's more the principle of bait and switch that I don't like.

Therein lies the rub. Particularly this early in the contract, there's plenty of other people they could find who would take that 10% cut (and maybe still find themselves vulnerable to another cut soon).

I read this completely differently. Demand should be demand by the client, and supply the supply of services. But I expect you're right and the OP means that demand for gigs outstrips supply of gigs. Funny way of looking at it.