You need to be careful that any retainer arrangement doesn't weaken your IR35 position. If you search for my previous thread on this you'll see some discussion on the potential pitfalls.
In short, a retainer creates an unavoidable degree of MOO so you want to make sure your contract is carefully drafted.
I currently have a retainer agreement with a client to continue occasional work on a previous project. I drew up a completely new schedule for this work.
I would recommend specifying a fixed fee for a budget of X days. My own contract gives the client a bit of flexibility to roll over or bring forward one day a month but otherwise any unused time is lost (they do not pay pro rata).
I would also strongly advise keeping the scope of the work as narrow as possible. If your on retainer and the client can ask you to work on whatever they like then IMO that's a large pointer to being inside IR35 as you are starting to look more and more like a disguised employee.
Also try and structure the deal so as little notice as possible is needed on both sides to end the agreement and I would consider giving the agreement an end date, even if it's a year or something. Don't leave it open ended. You can always renew it.
Obviously the usual advice about direction and control still applies. Make sure you retain a good degree of control over when and how the work is performed. Make sure the client knows you have other clients and you will arrange your working hours accordingly.
If you can get an unfettered right of substitution clause and it's genuine this should be able to largely kill any IR35 arguments. It must be genuine though - I had a substitute lined up before I started my current retainer deal (a contractor who had worked with me in the project before) and made the client aware that I would be delegating to him if I was tied up or away/off work, which they were happy with.
Finally, get any agreement reviewed. I based my retainer agreement in my existing schedule which was based on the PCG contract. It passed review with flying colours.
From a purely business perspective, offering different levels of service for different costs make sense. I just based my fixed fee on my daily rate. The client is yet to use their full allocation of time each month so it's been quite a profitable arrangement for me so far although I've been quite flexible with them about rolling days over.
HTH.
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Retainers
Morning All,
I was wondering how you guys deal/build up retainer deals with some of your clients? A past client of mine has asked for me to offer some form of retainer, and my inital thoughts would be to pack up some offerings (Gold, Silver & Bronze) that cost a certain amount per month. Each of these offerings will offer some set hours, different engagement (phone, email onsite) and maybe some types of service (e.g. System Design).
Does that sound like the right kind of solution to go with? Or do you simply offer a set number of hours per month for a set cost?
Thanks
Paul
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