Reply to: Agency and HR sidestepping increase negotiation

[WordIsBond]

I'm glad to see you care so much about making sure the agent is treated fairly.

[northernladuk]

Fight it in advance, when they think you aren't getting an increase.

Surely fighting it in advance and getting it in writing costs the agents time and money so they are actually doing some extra work so they would be justified in keeping their percentage?

[washed up contractor]

Is this still being chatted about and not actioned by the OP!?!

[WordIsBond]

If they are on a fixed margin it will be around 6-8%.. Are you really bothered fighting the whole client/agent model for the sake of 6-8% of a the tasty uplift you got.

Fight it in advance, when they think you aren't getting an increase.

[WordIsBond]

Well, sounds like they've effectively given you permission to find out what the agency's cut is.

I would expect you'd put your case to the client and the agent would tell you what is agreed. I don't agree with WiB's comments you've got open season to find the agents commission. Although you can discuss a rise with the client they may not actually talk numbers with you.

<snip>

EDIT : All that said I think you are screwed if it is HR they want you to speak to. HR will just stick to the rates. They can't make decisions based on the delivery and impact and agree rates with clients. You should be speaking to supplier management, not HR at the very least.

First, your edit is pointless. He's being told to speak to supplier management.

They have told me that I need to negotiate this directly with the manager I work with in the client. They say the bank's HR team insist this is the procedure.

Second, you disagreed with me. You should know better by now.

I didn't say the manager would talk money with him. He's been told by the agent that he CAN talk money with the manager. So he has permission to do so, and if the manager will engage in that conversation, he's almost certain to find out that cut -- and they won't be able to object. He has permission to have a conversation that, if it happens, will almost inevitably reveal that.

OP, the suggestion above to get it in writing from the agent is a wise one. They should agree that their cut won't change, and the increase comes through to you entirely. They aren't going to do anything for it, and by refusing to get involved, they are saying they would be happy to provide the service for exactly what they are getting right now. So there's no reason for their cut to increase just because you've done some work that they might have done. Get that up front.

[northernladuk]

All good points, but doesn't get round the fact that if the client agrees to an increase, the agent is going to want a piece of that action, and the contractor has to accept that. Alright £50 out of £100 isn't going to happen, that was hyperbolic.

If they are on a fixed margin it will be around 6-8%.. Are you really bothered fighting the whole client/agent model for the sake of 6-8% of a the tasty uplift you got. As I said before it's a benefit the agent has side stepped. If you wanted them to work for their money you would get exactly nothing.

[Lance]

But that scenario isn't real and doesn't really help.

The agent knows the client has a rate card. Probably been working to the same rate card for more or less every single contractor. One comes along and wants more? Why does he want more? Is he delivering more, has his ability increased while he's been there? Or is he just being greedy and holding his client over a barrel? Does an agent really want to enter a fight they know they won't win over a greedy contractor? Not really.

OK the contract is with the agent and they should be the go between client and contractor but if the agent is on a fixed margin and I was looking for the rate increase to come from the clients rate card then I'd actually prefer to drop the incompetent party who doesn't care as there is nothing in for them (Ok a few %). The agent would be next to useless so IMO they've done you a favour allowing you to talk to the client.

I would expect you'd put your case to the client and the agent would tell you what is agreed. I don't agree with WiB's comments you've got open season to find the agents commission. Although you can discuss a rise with the client they may not actually talk numbers with you.

How much of a rate rise are you looking for? You gonna dump your client over £20 a day more or are you looking for £100's?

EDIT : All that said I think you are screwed if it is HR they want you to speak to. HR will just stick to the rates. They can't make decisions based on the delivery and impact and agree rates with clients. You should be speaking to supplier management, not HR at the very least.

All good points, but doesn't get round the fact that if the client agrees to an increase, the agent is going to want a piece of that action, and the contractor has to accept that. Alright £50 out of £100 isn't going to happen, that was hyperbolic.

[northernladuk]

it might not seem right, but they have control.

Imagine the scenario where you agree £100 extra per day from the client. You then get £50 extra per day (or maybe nothing extra at all) from the agent.
What are you going to do? You have to be willing to walk or suck it up.

But that scenario isn't real and doesn't really help.

The agent knows the client has a rate card. Probably been working to the same rate card for more or less every single contractor. One comes along and wants more? Why does he want more? Is he delivering more, has his ability increased while he's been there? Or is he just being greedy and holding his client over a barrel? Does an agent really want to enter a fight they know they won't win over a greedy contractor? Not really.

OK the contract is with the agent and they should be the go between client and contractor but if the agent is on a fixed margin and I was looking for the rate increase to come from the clients rate card then I'd actually prefer to drop the incompetent party who doesn't care as there is nothing in for them (Ok a few %). The agent would be next to useless so IMO they've done you a favour allowing you to talk to the client.

I would expect you'd put your case to the client and the agent would tell you what is agreed. I don't agree with WiB's comments you've got open season to find the agents commission. Although you can discuss a rise with the client they may not actually talk numbers with you.

How much of a rate rise are you looking for? You gonna dump your client over £20 a day more or are you looking for £100's?

EDIT : All that said I think you are screwed if it is HR they want you to speak to. HR will just stick to the rates. They can't make decisions based on the delivery and impact and agree rates with clients. You should be speaking to supplier management, not HR at the very least.

[Lance]

If the agent is going to do nothing I don't see why they should get more money as a result of me doing what they should be.

it might not seem right, but they have control.

Imagine the scenario where you agree £100 extra per day from the client. You then get £50 extra per day (or maybe nothing extra at all) from the agent.
What are you going to do? You have to be willing to walk or suck it up.

[ZodTheMerciless]

Ensure any 'go ahead' from the agent is in an email so can prove they shirked responsibility should they later decide the contract terms forbid it and any increase you negotiate is to be passed to them for them to decide your cut in your contract with the agency.

i.e. Just because 'they can't be arsed' doesn't mean they can be circumvented altogether. Any rate increase from the client will still go via the agency so you'd need to ensure the rate from the agency reflects your expectations, depending on how the agency's cut is determined, fixed rate or percentage. Percentage obviously means they'll get some of the rate increase unless you manage to get them to lower their cut too.

That's why it's easier to just 'play hard ball' with the agent and tell them what you want or you're walking. Their cut and the overall fee the client pays is then irrelevant to you.

For any discussion about rates direct with the client I've always let the client be the instigator, otherwise I expect the agent to do their job on my behalf. Your contract is with the agency not the client.

Yea you've stated it all very nicely. My contract is with the agency, so having to negotiate directly to the end client, while making sense from some perspectives, is just not right. I once had an agent give me an increase from their margin to keep me at a place. Once they've placed you the money coming in with renewals is pretty close to effort free for them.

[ZodTheMerciless]

How do you work that out?

If the agent is going to do nothing I don't see why they should get more money as a result of me doing what they should be.

[Hobosapien]

Indeed. There is a probably a contract term that forbids you from discussing rates with the client. Here's a get-out from that.
Probably the individual agent is clueless ****wit, but nonetheless you have the go ahead so fill yer boots.
If the client agrees to pay you more then this becomes the agent's problem very quickly.

Ensure any 'go ahead' from the agent is in an email so can prove they shirked responsibility should they later decide the contract terms forbid it and any increase you negotiate is to be passed to them for them to decide your cut in your contract with the agency.

i.e. Just because 'they can't be arsed' doesn't mean they can be circumvented altogether. Any rate increase from the client will still go via the agency so you'd need to ensure the rate from the agency reflects your expectations, depending on how the agency's cut is determined, fixed rate or percentage. Percentage obviously means they'll get some of the rate increase unless you manage to get them to lower their cut too.

That's why it's easier to just 'play hard ball' with the agent and tell them what you want or you're walking. Their cut and the overall fee the client pays is then irrelevant to you.

For any discussion about rates direct with the client I've always let the client be the instigator, otherwise I expect the agent to do their job on my behalf. Your contract is with the agency not the client.

[washed up contractor]

Hi there,

Just wanted to get some thoughts from the community. I'm about to complete a contract at one of the big investment banks in London and they want to renew me. I have informed the agency I will but want a rate increase. They have told me that I need to negotiate this directly with the manager I work with in the client. They say the bank's HR team insist this is the procedure.

I've contracted to banks in London for 15 years and have never once had an agent and the client's HR team refuse to be involved in a rate increase negotiation. Even with this same bank, I negotiated an increase through the agent & HR just a couple of years ago. Talking directly to the manager I work with about this seems rife with potential to damage the relationship rather than using the standard buffer. And apart from chasing money, I'm not really sure how the agency can justify their continued cut when they won't even involve themselves in this.

So yea, have I just been fortunate in the past 15 years in not having to do this directly or is this as surprising to others as it is to me?

Cheers

What is the problem? If you want the increase get talking. If they say not interested and the agents says not interested then you know what your options are.

[Lance]

Well, I've often found the people I'm working with have very little knowledge or input into what contractors are paid, so having to approach them about it is a bit awkward. But yea, it's an interesting point regarding the agencies' cut. I've no idea if it's a percentage or a flat amount. They won't be seeing a penny of any increase I negotiate myself that's for sure.

How do you work that out?

[Lance]

Well, sounds like they've effectively given you permission to find out what the agency's cut is.

You are running a business that is providing a service for a fee. I'd say it is easier to make that case, if the fee increase is actually warranted, with the person who is interacting directly with that service. I don't see a problem.

Indeed. There is a probably a contract term that forbids you from discussing rates with the client. Here's a get-out from that.
Probably the individual agent is clueless ****wit, but nonetheless you have the go ahead so fill yer boots.
If the client agrees to pay you more then this becomes the agent's problem very quickly.