Reply to: Im being fleeced!

Agencies

They are pretty much all the same no matter what the industry, my dear old Da - came out of work and contracted through a building agency and they fleeced him. He's learning the tricks now and watching out for the pitfalls.

I also got fleeced at first but needed the work (Bankrupt is not a good reference for credit so I needed to avoid that). So I accepted a low rate and then they sent a contract with £1 below the agreed rate, I took it - got my foot in the door and then knocked up the rate each month and got to such a standing whereby now I call the shots. The trick is not to shoot yourself in the foot and remember that there are always people out there prepared to work for less than you so don't price yourself out the market, but don't let your agency do that for you either.

How to fix it..

Many moons ago, I got a contract and I was a direct replacement for a guy who was leaving. As there were only 2 weeks left on his existing contract, the end client took that as an opportunity to give me a "trial" run, and gave me those 2 weeks.

After the first day, everyone went out for the old guy's leaving do, and I joined them. The beer flowed, and eventually I found out how much the agency was taking as their cut! 60%!!!

I was happy with the rate I was getting, but not when I found out how much they were taking. So, here is how it went.

I impressed the pants off the client, and they offered me a 3 month extension. So I went back to the agent, said I knew how much they were creaming off the top, and told them they could have 5%. We eventually settled on 10%, and I carried on.

18months later, the project was shutting down, and the client had not upped rates in the meantime (and had a valid reason), but to show their gratitiude the Project Manager got in touch with the agency, and said they were offering us all a loyalty bonus, to be paid direct to us, and that the agency would not be getting a cut.

Overnight, I was £5000 richer, and the agent got nothing!

I have been away from the "game" for a while, but am getting back in, and I always find agents have not changed.

My advice;

Ask them what their cut is, and verify this with the client if at all possible.

The bigger the recruiter, and the client, the more likely that there is a preferred supplier arrangement and the cut will be quite small, 5-15%.

Remember that if you were an agent you would also be trying to make as much as possible.

If they advertise in the press, they get hundreds or thousands of muppets applying, and maybe 10-20 reasonable CV's which they must vet, and make presentable to the client.

The actual recruiter (the guy you speak to) does not normally make that much in commission.

I always like to think of recruiters like double-glazing sales staff were years ago. These days everyone has double-glazing, so people of that mind-set need to find something else to do.

If you like the role, and are happy staying there if offerred an extension. Talk to the agent, say you are not happy being ripped off, you have other options, and make them reduce their rate to 10-20%. They have all the mechanisms in place, and now just watch the £s come rolling in. So some £s are better than no £s....

Good luck....

Always ask.

I always ask the agent how much they charge.

Mines is taking £500 per week but then again Im getting a £2k so to be honest I wasnt really bothered.

We agreed the cut before the contract started and both parties are happy.

Re: nah...

nah...

that was more aimed at BB's holier than thou message

Mailman

Re: Actually...

it is my business to know what the client is being charged as Im on the at the sharp end providing the consultancy services...maaaate!

Only if it's your budget. I've been an imterim manage and in that siutation - sadly I couldn't give myself a rise!

You are providing a service to a client. What they do with their money is only your concern if they have engaged you to manage t on their behalf. If they have, then you can immediately suggest a way to save them money (well, two ways actually, but I leave that as an exercise for the reader).

Otherwise, your contract is with the agency and it is the agency who are paying you. How they recover that money and to what extent is not your concern.

Actually...

it is my business to know what the client is being charged as Im on the at the sharp end providing the consultancy services...maaaate!

As Ive said before...Im happy with what Im getting and would be HAPPIER with more (just like everyone else here! )

But yes...the lesson has been learnt...agencies ARE bastards and when the contract comes up for renewal they will get a good screwing (as they arent the prime agency for the bank Im working for anyway).

Mailman

Re: Talk to the client.

Neither the client nor the agency are obliged to divulge the details of their contract, and if you do happen to find out because of people babbling when they shouldn't, then when you come to judge the agency, this particular piece of evidence is "inadmissable", because whether you like it or not it's not your business.

Having said, knowing what the agency can charge is useful in the polite and fair negotiations you undertake once the contract is up for renewal. In certain exeptional circumstances where the agency or consultancy through which you work has some special relationship, eg because they provide fixed price support, they can afford to take a high margin because the client is tied to them, and they can throw you out.

The lesson you should learn is that you are responsible for finding out what you are worth and charging that amount. If you really are worth an extra £100 a day you'll get it when you ask, if not you won't, and they'll replace you.

Re: Talk to the client.

Decide what your lowest acceptable rate is and stick to it.

Then if an agent comes and asks you to go lower you can refuse. If they're trying to scim the fee they'll give you what you want after a lot of pleading (they want the work after all...). If they don't then no hard feelings.

I'm happy with my rate and I never get involved with how much they're charging the end client unless I'm told I'm expensive, then I take great pleasure in tell them how much I'm paid.

I don't hold with this "don't tell the client" business, you can bet that the agent is being crafty/dishonest if this happens.

Talk to the client.

Speak to the client, along the lines of:

"You do realise that the average agent margin is around 15%. You are paying 40%."

1st step is to make client feel cheated by agency.

Once agency is booted or margin is dropped, then of course there is room for you to hike your rate at renewal time, since the client is no worse off than they were at the outset.

Good luck.

All agents are scum.

Im happy

Im not complaining...I just reckon the agency used some rather under handed tactics to screw me for as much money as possible...is nothing sacred these days?

Ill tell you what though...my contract is up for renewal in a couple of months so Im going to utterly screw the bastards for every cent I can get!

Mailman

As a matter of interest, 'mailman', are you going to drop us some subtle clues about the identity of the agency ??

Re: grrr!

Ah. Rule one of contracting - never believe the agent!

From their viewpoint, the client is willing to pay £500 and they have found a resource that costs £300. At the outset both sides are happy and the agent gets to keep £200. They would argue that you got £100 a day more than you were asking for, so what are you moaning about.

To put it another way, next time you're in the pub, offer to pay £1.40 for your pint because you've discovered the landlord makes 40% on all the beer he sells and why shouldn't you have some of it.


You can try to renegotiate but only if you have something to negotiate with, and at a sensible point in the cycle, like renewal or change of requirement. Arguing about someone else's margin is not it.

As I said, the most likely end result is no contract. Be careful.

grrr!

Malvo,

I was originally told the contract was for £200-£400 a day and that they would put me down for £200 a day as my contract rate.

When I got the contract they said my rate had moved up to £300 a day and now I find that the actual rate was always £500 a day!

Do I have a leg to stand on since I never told them specifically that the £200 was my daily rate (as I was lead to use that figure by the agency)?

Mailman

No you're not.

If you're unhappy, try and renegotiate! But, remember, you are a professional, so do it professionally!

Spod.