Reply to: Agency paying less than agreed client rate (skimming off top)

[Agent]

I'd get over it as quickly as possible.

[LondonManc]

Yeah, I was only actually replying to this bit "Similarly he knows there's scope for a rate increase once he proves himself.". Should have made it clearer.

Ah fair enough. There's still scope though if he's on 275 and knows there's' 300 to be had

[radish2008]

He's got what he agreed. We still don't know what the agent is on, only that the budgeted figure was £300. The difference between the £275 is unknown - it could be that the agent has got him in under budget but there's no knowing whether the agent has trousered the rest and is billing the client £300 + commission.

Yeah, I was only actually replying to this bit "Similarly he knows there's scope for a rate increase once he proves himself.". Should have made it clearer.

[LondonManc]

Not always true. I worked at a client and the agent was on 25%. I hadn't worked for a few months so had been happy and though I'd push for an increase on renewal. The hiring manager told me the cost without me telling him the rate I was actually on. Come renewal the client was very keen to keep me on and the agent wouldn't budge. The market was still quiet and he said he'd pull me and replace me easily so no deal. He was an arsehole as well though. Another agent tried to skim £10 off the rate after we had agreed terms and I refused - he backed down after talking to his boss for 5 mins. I think some banks are moving to in-house with no external agencies, certainly the current gig is this model.

He's got what he agreed. We still don't know what the agent is on, only that the budgeted figure was £300. The difference between the £275 is unknown - it could be that the agent has got him in under budget but there's no knowing whether the agent has trousered the rest and is billing the client £300 + commission.

[BrilloPad]

I was in this position before. The client sorted it. If the client does not sort, you have no way forward.

The client was Goldman Sachs. The agency Modis. The GS account was worth a lot of money to them. And they only agreed to back down after GS threatened to pull the global account.

[radish2008]

Oh yes, I'm not for one minute suggesting that we show any trust towards an agent. I'm just saying that if they have managed to get the OP in under budget, then he shouldn't be upset that he's lower than actual. Similarly he knows there's scope for a rate increase once he proves himself.

Not always true. I worked at a client and the agent was on 25%. I hadn't worked for a few months so had been happy and though I'd push for an increase on renewal. The hiring manager told me the cost without me telling him the rate I was actually on. Come renewal the client was very keen to keep me on and the agent wouldn't budge. The market was still quiet and he said he'd pull me and replace me easily so no deal. He was an arsehole as well though. Another agent tried to skim £10 off the rate after we had agreed terms and I refused - he backed down after talking to his boss for 5 mins. I think some banks are moving to in-house with no external agencies, certainly the current gig is this model.

[LondonManc]

Yes, that's true. I still thought it was worth offering a point that if the agency had done what the OP feared, that would be shady business practice for sure. But you were right to point out that seeing the budget does not mean he's seen what the agency is getting paid IMO.

Oh yes, I'm not for one minute suggesting that we show any trust towards an agent. I'm just saying that if they have managed to get the OP in under budget, then he shouldn't be upset that he's lower than actual. Similarly he knows there's scope for a rate increase once he proves himself.

[jmo21]

I'm inclined to agree in part with the poster who had a spaz out about agencies. Taking the OP's post at face value, it appears the agency said the client would only pay £275 (which we can all reasonably assume is the figure before the agency's margin). However if the client is actually paying £300 plus the agency's margin (and I accept that there are reasons why that might not be the case, but let's assume the OP is correct in what he's seen), then that is pretty shoddy behaviour.

I'm all for being hard nosed in business, etc, and I occasionally have the option to make a margin on work I've had to outsource, but I don't accept that lying about what a client would pay and keeping an extra £25 is part and parcel of business. It's part and parcel of being a c**t.

I don't think anyone disagrees about them being c**nts when they do this.

When people say "it's part and parcel of business", they are not trying to absolve the dodgy agents of their behaviour. They are saying it's highly unlikely that you will be able to force change, and you just need to be aware of it and work within the system.

When newbies first hear of agents doing this they get upset, they want to do something about it, change the world etc (and start websites that are contractor-to-client direct). A noble cause indeed. (and also to the newbie on here recently saying posters on CUK are all agents pretending to be contractors and lying - that's not the first time a newbie has posted that either)

The reality is changing how it works would be very difficult. Yes, we could all band together, let clients know, black list agencies etc etc.

Will it work?

Probably not.

Why?

Because you will never get 100% of people to do it. Most people need to work. Most people can't afford to keep knocking contracts back until the system changes.

And no, I'm not saying you should never fight for change, but this isn't the civil rights movement, you are not Rosa Parks.

[vwdan]

Ultimately, we're all in this to make money and part of business is negotiation. Everyone in the chain is trying to pay as little as possible out and get as much as possible in - including the client, including you and definitely including the agent. Yes, it's a bit cheeky to outright lie and say the client is only paying £x, but at this point it's bordering on semantics. If he'd have said "Sorry mate, £250 is the absolute best I can do" then you'd have no argument at all. It's also plausible that he's gone to the client and said "Hey, I managed to get this guy down to £250" for you.

Some you'll win and some you'll lose. I know for a fact that the end client was paying £1000 a day for me (Via a consultancy) on one of my lowest paying gigs. I also know that I've done days for one consultancy who were as good as losing money on it. If you're senior enough and trusted you're going to come across paperwork that starts to shed some light on the realities of who is paying who - it's great for future negotiations and it's always good to know how much you're "winning", but it's ultimately immaterial for the now and it's definitely not something to get upset over.

And let's face it - we just pull our rates out of thin air, based on what we reckon the market can support.

I do agree that there's a limit to this - clients are going to pay based on experience/skills or whatever. If I ask for a £600p/d contractor and the agent sends me a £200p/d contractor then I'm not going to be happy. But, again, that's really a client/agent discussion - it doesn't mean you're magically entitled to the extra cash.

[northernladuk]

Happy Birthday GillsMan.

[GillsMan]

That was my main point - he's only seen a budget.

Yes, that's true. I still thought it was worth offering a point that if the agency had done what the OP feared, that would be shady business practice for sure. But you were right to point out that seeing the budget does not mean he's seen what the agency is getting paid IMO.

[LondonManc]

I'm inclined to agree in part with the poster who had a spaz out about agencies. Taking the OP's post at face value, it appears the agency said the client would only pay £275 (which we can all reasonably assume is the figure before the agency's margin). However if the client is actually paying £300 plus the agency's margin (and I accept that there are reasons why that might not be the case, but let's assume the OP is correct in what he's seen), then that is pretty shoddy behaviour.

I'm all for being hard nosed in business, etc, and I occasionally have the option to make a margin on work I've had to outsource, but I don't accept that lying about what a client would pay and keeping an extra £25 is part and parcel of business. It's part and parcel of being a c**t.

That was my main point - he's only seen a budget.

[GillsMan]

I'm inclined to agree in part with the poster who had a spaz out about agencies. Taking the OP's post at face value, it appears the agency said the client would only pay £275 (which we can all reasonably assume is the figure before the agency's margin). However if the client is actually paying £300 plus the agency's margin (and I accept that there are reasons why that might not be the case, but let's assume the OP is correct in what he's seen), then that is pretty shoddy behaviour.

I'm all for being hard nosed in business, etc, and I occasionally have the option to make a margin on work I've had to outsource, but I don't accept that lying about what a client would pay and keeping an extra £25 is part and parcel of business. It's part and parcel of being a c**t.

[MrMarkyMark]

Only if they are repeat offenders. The agency would claim one errant agent and/or admin error if it's just one contractor. It takes quite some time to negotiate a PSL contract with an agency so they'll not drop it over one error.

When I was a mere grasshopper contractor, although I still am at least in my eyes , I found out the agent was making 20%.

No fuss, but it has never happened again, consultancies are a completely different story, they have made big £££ out of me.

[Lance]

It wouldn't surprise me if caught like that that they were just struck off for a bit. It would depend on the end client but most would take a very fixed dim view on their fixed margins PSL contracts being broken by profiteering....

Only if they are repeat offenders. The agency would claim one errant agent and/or admin error if it's just one contractor. It takes quite some time to negotiate a PSL contract with an agency so they'll not drop it over one error.