Reply to: bumping rates due to inflation

[oliverson]

They are also looking to shave costs because the market is getting tougher. I'm with Lance on this one. There will be no rate rises because of inflation, more chance of the opposite. Clients tend to have rate cards and they aren't going to move them a few percent to keep in with inflation. IMO contractor rates are too far from inflation to be affected. I don't think I will be rocking any boats for a few quid here and there. Get the first piece of work done and then pressure the agent for any rises as we have always done.

Surely the WFH option has swelled the coffers more than a few percent hike on your rate? Does that not cover it?

This one. I considered pushing for a rate bump at last renewal but then reality kicked in:

1. Due to 100% remote working I no longer incur London expenses (£ 30k p.a. accommodation/travel/subsistence)
2. My current day rate is the same as my last London day rate
3. My current client is overseas and the exchange rate at present adds around £75 to my day rate, long may it continue
4. It's outside IR35
5. There's a large programme of work

So, to summarise, I'm up to around £ 50k p.a. better off, zero commute, outside IR35 and working with a decent bunch of people on an interesting project using latest tech. Probably the best contract I've ever had and maybe (hopefully) the last one.

[northernladuk]

Indeed, because the majority of contractors aren't actually businesses and your Ltd is just a vehicle for your personal services. Your client does not see you as a business, they see you as "Dave working through his Ltd" or "Steve that the agency supplies". So you might as well try and play the inflation/cost of living card...

Possibly but might as well just stick it to them and threaten to walk. Same outcome either way. I personally think playing the inflation card is weak and the agent will see it and play you like a fiddle. They know you won't leave for a few percent. They also know you are taking in over 100k so won't be worrying about inflation like they have to. I'd rather just go in and say my rate is now £XXx thank you, than make poor excuses.

[d000hg]

But it isn't reasonable for a one man contractor with no businesses costs to put a sensible case to a client for inflationary pressures.

Indeed, because the majority of contractors aren't actually businesses and your Ltd is just a vehicle for your personal services. Your client does not see you as a business, they see you as "Dave working through his Ltd" or "Steve that the agency supplies". So you might as well try and play the inflation/cost of living card...

[northernladuk]

It's entirely reasonable to put a sensible case to your client based on inflationary pressures, but whether they agree is another thing. More typically it would be done at renewal but there's nothing to stop you mid-contract if you have a strong argument, I suppose.

But it isn't reasonable for a one man contractor with no businesses costs to put a sensible case to a client for inflationary pressures. Other businesses maybe but a one man contractor? No. And putting it in mid contract is a no no. There is no strong argument for a couple of percent increase because of inflation mid contract. Just makes you look like trouble which is a strong argument not to. Renewal yes but again, just no need to bother mentioning inflation. Just stick it to them and say you want X and hold tight. Putting an excuse with it won't make one iota of difference.

I guess you 'could' do what you suggest but they are all bad ideas to do as and when you state. Possible yes, good ideas? No.

[Guy Incognito]

I have always worked for the rate I could achieve at the time. You can use inflation as a negotiation tactic but ultimately you will get whatever rate you negotiate.

I've had two rate reductions during Covid but the cost of doing business has gone down as I now work exclusively from home.

Inflation itself is a non issue I don't spend a large enough percentage of my income on the things it tracks.

[d000hg]

Ignore inflation. That's a consumer issue. You're a business. Your business doesn't pay for food, or fuel (generally speaking).

Businesses have staff costs and staff costs are pushed up by inflation, because all the businesses the staff buy from are putting their prices up.

It's entirely reasonable to put a sensible case to your client based on inflationary pressures, but whether they agree is another thing. More typically it would be done at renewal but there's nothing to stop you mid-contract if you have a strong argument, I suppose.

[achilles]

You can bump your rate as much as you like, if the market does not support it you won't get it. It has nothing to do with inflation, we are in a Demand / Supply market.

[ensignia]

so why are you commenting when you have nothing to impart?

To highlight your bad advice. Thought that was obvious, even to someone who struggles with basic reading comprehension.

[Lance]

I give plenty of advice should I have something to impart

so why are you commenting when you have nothing to impart?

[ensignia]

inside is a job… so you may well get permie protections.

Nice moving of the goalposts there... Contracting is a job despite what the anoraks on here might say.

good luck with getting an uplift for outside…
IT’S NOT A “REDUCTION”

You can post in CAPS all you like it doesn't mean its any more valid, and it just marks you out as a bit of a simpleton.

i never said you gave bad advice. You snipe from the edges and give no advice. Hence you’re just a troll.

"Snipe from the edges" I give plenty of advice should I have something to impart, rather than the actual trolls on here who have racked up thousands of posts while not really saying anything useful or having any real knowledge of the topic.

[TheDude]

Increased costs is a hot topic right now and is being talked about by the man on the street, why do you think contingent workers won't be affected by increased costs elsewhere in their lives?

Probably because most of us have worked with contractors who regularly imply how well off they are (even if in the majority of cases this actually turns out to be a 4 bed detached house and a mid life crisis sports car)

[Lance]

The agency for my Inside contract have agreed an 11% uplift to cover NI & inflation increases. Increased costs is a hot topic right now and is being talked about by the man on the street, why do you think contingent workers won't be affected by increased costs elsewhere in their lives? Literally everything has gone up in price and it's expected that clients/employees meet that cost.

My Outside client have yet to be asked that question, but because it's Outside and mostly interesting I'm happy to absorb the effective rate "reduction".


"Trolling" It seems like many on here just sit around jerking each other off trying to ingratiate themselves with the other clique members, and get uppity at an opposing view.

Oh, and please find me another post where I've actually said bad advice.

inside is a job… so you may well get permie protections.

good luck with getting an uplift for outside…
IT’S NOT A “REDUCTION”

i never said you gave bad advice. You snipe from the edges and give no advice. Hence you’re just a troll.

If you think I, and others, are wrong (which I accept may be true) then how about telling the OP how to go about getting a rate increase due to inflation?

an ‘opposing view’ needs some actual information.

[ensignia]

only if their incoming costs also increase. Which for a contractor isn't the case.
Have you ever got an inflation based rate increase?
Do you know anyone who ever did?
That sort of increase is for permies.
So I respectfully disagree with you.


Anyway. before you just glibly say 'bad advice' like you always do. How about give the OP some useful suggestions. Just disagreeing with me isn't helpful, and the number of times you just disagree with others on here is getting to the point of trolling.

The agency for my Inside contract have agreed an 11% uplift to cover NI & inflation increases. Increased costs is a hot topic right now and is being talked about by the man on the street, why do you think contingent workers won't be affected by increased costs elsewhere in their lives? Literally everything has gone up in price and it's expected that clients/employees meet that cost.

My Outside client have yet to be asked that question, but because it's Outside and mostly interesting I'm happy to absorb the effective rate "reduction".


"Trolling" It seems like many on here just sit around jerking each other off trying to ingratiate themselves with the other clique members, and get uppity at an opposing view.

Oh, and please find me another post where I've actually said bad advice.

[PerfectStorm]

If you don't secure it now, you'll be hard pressed to ask again.

If you have leverage, go for it. Just don't stick around if they say no, you'll look a right mug.

[lecyclist]

Working remotely for the past 2 years+ has made me reluctant to ask for a rate increase, as I've been accustomed to travelling for work over the years.

Inflation doesn't come into it in my mind - there is only market price. If you are unhappy with your rate, and have reason to believe you are worth more (preferably based on evidence), then of course ask for more or go elsewhere.

Establishing trust from zero with a new client takes time, and it doesn't always lead to better conditions down the line.

Current client is in the top 3 of my working life, so perspective plays a part. If it was bottom 3, I would already have left, or asked for eye watering rate increases to ameliorate my ennui/ trigger my contract termination.