Reply to: Agents who take huge cuts , renewal time strategy.

[eek]

This is the key, there is no point playing any games unless you are prepared to walk.

Secondly, if money is the only factor you should get out of contracting, if someone is getting 12.5% more than you there could be a myriad of reasons as to why. If you were happy with the rate to begin with what has changed, if you weren't happy why did you accept it then?

Thirdly, agents don't take a cut, it's their relationship with the client and you take a cut of their money.

On your second point - As you know I was never the most expensive, you don't want to be the obvious one to cut when the project tails off a bit.

As for your third one, the relationship does cut both ways but except for obvious examples (Digital Outcomes and Specialists being the main one) the most important bit will be who is on the end client's PSL and it won't ever be the sole contractor.

[LondonManc]

Agents huge cuts. Easily misread.

If you and the hiring manager both feel like the agency is taking the p**s, get the hiring manager to tell the agency to bring you in line with the rate and commission of the other contractor. It will be beneficial for the hiring manager and you.

[Lance]

Really? An agency has walked somebody off site for this? I'm aware that their business model is based on smoke and mirrors but they'd remove a fee-earner for them and then oblige the client to go through the rigmarole of interviews again, what did the client make of all this?

Yes. They had 30 people on site. All on a blended rate. Talk about rates was a no no.
They had other people lined up and the client had no say in the matter, nor did they interview.

[malvolio]

This is the key, there is no point playing any games unless you are prepared to walk.

Secondly, if money is the only factor you should get out of contracting, if someone is getting 12.5% more than you there could be a myriad of reasons as to why. If you were happy with the rate to begin with what has changed, if you weren't happy why did you accept it then?

Thirdly, agents don't take a cut, it's their relationship with the client and you take a cut of their money.

Absolutely this ^^^.

It's scary how many contractors think they are the ones winning the business. It's a commodity market these days, you are merely cannon fodder (or, to be a little more Keynesian, a cash cow). You want more money, learn to negotiate or find the work yourself and go direct. but foirst, understand the market you are in.

[SimonMac]

Unless you are 100% prepared to walk, don't bluff.

This is the key, there is no point playing any games unless you are prepared to walk.

Secondly, if money is the only factor you should get out of contracting, if someone is getting 12.5% more than you there could be a myriad of reasons as to why. If you were happy with the rate to begin with what has changed, if you weren't happy why did you accept it then?

Thirdly, agents don't take a cut, it's their relationship with the client and you take a cut of their money.

[caffeine man]

in 20 years of contracting, seen a couple of nasty situations develop from agents taking larger than expected cuts.

1. client insisted I tell them my day rate at interview. Only happened once, but client insisted on a cut to reduce the agency margin. Agency insisted I take the cut. In the end, I accepted it, as I was in a bad market. This was around 15 years ago.

2. client found out about agency cut being higher. Client furious and terminated contract with agency. Contractors were told by client to use another agency if they wanted to stay. They moved to another agency. The original agency found out, and threatened to sue the existing contractors for lost income. One contractor got sick of the drama and left. The rest carried on using the new agency, and eventually the old agency gave up on the idea of suing them. But the threats, and drama at the time were nasty.

[eek]

Really? An agency has walked somebody off site for this? I'm aware that their business model is based on smoke and mirrors but they'd remove a fee-earner for them and then oblige the client to go through the rigmarole of interviews again, what did the client make of all this?

An agency can walk the contractor off site and use innuendo to cover up what the actual reason was - so unless the contractor was very quick it's highly unlikely the client finds out the truth.

[LondonManc]

Unless you are 100% prepared to walk, don't bluff.

[Antman]

And this is precisely the reason why they have such clauses.
I’ve known agencies/consultancies walk people off site for having these discussions.

Really? An agency has walked somebody off site for this? I'm aware that their business model is based on smoke and mirrors but they'd remove a fee-earner for them and then oblige the client to go through the rigmarole of interviews again, what did the client make of all this?

[Lance]

Contracts I have had often carry a clause that restricts you from discussing rates / contracts with other contractors and the end client. (might be dressed up as keeping commercially sensitive information confidential)

So, take care with the "X is on y rate" and "client Co are paying A rate for me" - you could inadvertently demonstrate breach of contract.

M

And this is precisely the reason why they have such clauses.
I’ve known agencies/consultancies walk people off site for having these discussions.

[mjcp]

Contracts I have had often carry a clause that restricts you from discussing rates / contracts with other contractors and the end client. (might be dressed up as keeping commercially sensitive information confidential)

So, take care with the "X is on y rate" and "client Co are paying A rate for me" - you could inadvertently demonstrate breach of contract.

M

[skysies]

In this environment, it will be fair if you ask the agency to cut their rate to the minimum. I don't know if 10% is the minimum. You may start from 5-6%, the bare minimum at which they could run their accounts without making a loss.

[ShandyDrinker]

Although a late reply to this thread I've had a similar situation in the past (early in my contracting career), not by comparing rates of other contractors, but by having a frank discussion with the end client about the rate I was being paid.

In the particular contract in question, the agency were pulling a fast one with a markup of just over 30% at the time. When the end client found out they went ballistic, suffice to say that my rate was increased accordingly. The ultimate cherry on top was that the agency was removed from the approved suppliers list and eventually folded.

The moral of the story here is for contractors to know their worth and more importantly for agents and agencies to not take the proverbial as you will get found out, unwise when the majority of your contractors are placed at a single client.

[PerfectStorm]

Don't get into the trap of saying "but you're paying X more than me" - don't bring other people into it. This is between you and the agency.

[ComplianceLady]

Are you actually inside IR35 i.e. being paid through your limited? Is it possible that the difference is actually a stat cost being covered somewhere in the chain? If not and the agent has misled you they shoulkd absolutely accept they've been rumbled and change your rate.