Reply to: Contract renewal, to ask for a rise? How?

[TheFaQQer]

Worth a tilt?

He who dares, Rodders, he who dares.

[psychocandy]

6 months into my contract and a renewal is on the horizon... Wondering if I should ask for a rise?

I get paid in euros so in proper money my day rate has gone down over the last few months. (Yep, I know agent and client wont give a toss about that!).

The role was advertised at up to 75E more than I got in the end. (They gave me some crap about the max only being for contractors who didnt live local - as if they care as long as you turn up). I was reasonably happy with the rate so went for it.

Got no idea what the agency are taking on this. No idea what the other contractors in the team are getting (bit rude to ask?) but I suspect possibly more than me (since they aint local).

Was thinking about asking for maybe 25E a day more so not a huge amount.

In terms of justifying this, a lots changed at client co and a few permies have left the team which has left me carrying the can for the workload left. I think the client wouldnt want me to leave (I hope!) since I';m the only one in this area left!

On the other hand, client is doing the usual cost cutting stuff, restricting travel, talking about permie restructuring so I dont think they'd want to pay more.

Worth a tilt?

[vegan4life]

Hi, I just got renewed on approx 25% better rate. This is after 18 months with clientco and a failed previous attempt at extracting more dosh.

In hindsight - 6 months ago i couldn't justify a raise in terms of my performance. so I significantly upped my game and think I now at least match the 2 guys on my project who are on a level higher (more dosh).

1 month prior to renewal I asked my PM if she would be able to support a rate rise. he conceded that I was performing at a higher level than my current role description demands. my pimp was duly informed and approached clientco HR. result - more money but no 'promotion' to senior BA - so clearly have more work to do. quitting was not in the plan as the work is good and I am getting the experience I want. also several projects are being cancelled and so clientco is dumping quite a few contractors.

clientco doesn't really care what the pimp pays you. it's galling but I think - like me you you just need to chalk it up to experience. next time you need to do a bit of research and make sure you know what the top rate is for the role and make sure the pimp doesn't get the better of you. having something special or being able to prove that you are working beyond the level the role demands will help in rate negotiation.

[MiniMani]

love it!

"Didn't I see you snogging Lisa from Accounts at Mike's leavng drinks last wednesday?, and what did your wife think of that?

Now about this renewal.........."

Is a great way to start.

Really though its all about justification, business benefit, skills etc...

[doomage]

Have had 3 contracts myself. First one, rate when down and then back up (small company, through agent but negotiated directly with client).

Next one, had to squeeze the agent.

Recently, I noticed rates had gone up a little in my niche, so I emailed some job site postings to the clientco, hinting that I had been approached. That worked a treat but I spent some time getting the wording of the email right of course.

Mind you, I'm only on about half your daily rate, should be asking advice from you!

[Scrag Meister]

"Didn't I see you snogging Lisa from Accounts at Mike's leavng drinks last wednesday?, and what did your wife think of that?

Now about this renewal.........."

Is a great way to start.

Really though its all about justification, business benefit, skills etc...

[SueEllen]

Hmm, I think you are probably right there. I've read section 10 and I can't make head or tail of it though...

Don't worry a lot of people can't.

[Wanderer]

I don't think it does limit it - in a temp-to-perm situation, they have the right to offer an extension and then let you go perm after that, or you can do it without that by having a gap of 8 weeks from the end of the contract or 14 weeks from the start, whichever is later. Section 10 gives the right to charge and set out in its agreement the method for calculating a transfer fee in temp-to-perm and temp-to-temp situations provided. (source)

Hmm, I think you are probably right there. I've read section 10 and I can't make head or tail of it though...

[TheFaQQer]

The Agency Conduct regulations limit the temp to permie fee that an agency can charge the client. Should you ever go over to the dark side, remember to tell your client that you did not Opt Out so they should check how much they are paying the agency (if anything). You may be surprised to find that there is no fee after (say) 6 months working as a contractor. The temp to perm arrangement is between the client and the agency though, not really anything to do with contractors.

I don't think it does limit it - in a temp-to-perm situation, they have the right to offer an extension and then let you go perm after that, or you can do it without that by having a gap of 8 weeks from the end of the contract or 14 weeks from the start, whichever is later. Section 10 gives the right to charge and set out in its agreement the method for calculating a transfer fee in temp-to-perm and temp-to-temp situations provided. (source)

You're right - I wouldn't go asking the client for more money straight away, take the money out of the agency's margin if you can. If you can find out how much the agency takes then try and get them down to 10% or less. Point out to the agency that in the worse case scenario you could leave and come back in 3 months and go direct to the client or via an agency which takes a small fee (5-7%) for factoring the payments.

The idea of being able to flip agencies is a good one, providing
(a) the client will wait the 8 weeks
(b) you find an agency that will factor the invoices for a low margin
(c) the agency is able to get the work with the client (assuming they do not have an ASL)
(d) the client can be arsed to faff about so you can get more money

[Wanderer]

Agency getting payout if I go permie - I thought this was only if I had signed the opt out agreement? Which I didn't...

The Agency Conduct regulations limit the temp to permie fee that an agency can charge the client. Should you ever go over to the dark side, remember to tell your client that you did not Opt Out so they should check how much they are paying the agency (if anything). You may be surprised to find that there is no fee after (say) 6 months working as a contractor. The temp to perm arrangement is between the client and the agency though, not really anything to do with contractors.

I guess I just need to try and find out the margin (somehow!) or just live with it, my rate is more than acceptable but I don't want to be fleeced either, its the principle of the matter, I also do not want the clientco to pay more for me, I would want the agency to reduce their margin (if it was too high).

You're right - I wouldn't go asking the client for more money straight away, take the money out of the agency's margin if you can. If you can find out how much the agency takes then try and get them down to 10% or less. Point out to the agency that in the worse case scenario you could leave and come back in 3 months and go direct to the client or via an agency which takes a small fee (5-7%) for factoring the payments.

The ideal situation is that you find out how much the client are paying and then beat the agent down without the client knowing that you are getting a pay rise out of the agency's margin. Ask the agency straight up how much they are taking. If they won't tell you then it's going to be pretty high. They may also lie to you.

If you can't find out discretely then approach the client and ask them, saying you would like to negotiate the agency's margin down. The downside to this is that the client may want a cut of it too so there would be less money for your pay rise.

[malvolio]

I see. It's odd then that I should get internal emails encouraging contractors to apply for perm positions?

Some HR teams think permies are cheaprer than contractors. Also a lot of BS in HRw world about de-rsking things by switching to permies, totally ignoring the long term damage.

Onre thing to get your head around though, just so you understand the overall economics - the agency are not taking your money by adding a percentage to your rate, you are taking theirs by having a percentage of what they get paid, which in turn is dictated by the budget holder at the end client in the daisy chain. Which comes back to my original point, if you do want a raise you have to be prepared to demonstrate a financial justification for one.

[MiniMani]

Nope. It's also about the contract between agency and client, which will almost certainly contain clauses preventing them from taking you on direct, either as a permie or as a contractor.

I see. It's odd then that I should get internal emails encouraging contractors to apply for perm positions?

[JamJarST]

Agency getting payout if I go permie - I thought this was only if I had signed the opt out agreement? Which I didn't...

I guess I just need to try and find out the margin (somehow!) or just live with it, my rate is more than acceptable but I don't want to be fleeced either, its the principle of the matter, I also do not want the clientco to pay more for me, I would want the agency to reduce their margin (if it was too high).

IMHO, you are looking at this all wrong. You don't know how much the agent is getting and assuming he is "fleecing" you. If you can find out how much he is getting you can then negotiate with him to lower his margin, but as you said you are happy with your rate, what he gets is fair if you are happy with yours.

[TheFaQQer]

Agency getting payout if I go permie - I thought this was only if I had signed the opt out agreement? Which I didn't...

Nope. It's also about the contract between agency and client, which will almost certainly contain clauses preventing them from taking you on direct, either as a permie or as a contractor.

[MiniMani]

To answer this bit specifically.

- ask for higher than whatever you want and let them negotiate.

- the agency get a payout if you go permie. so that wont convince them.

Agency getting payout if I go permie - I thought this was only if I had signed the opt out agreement? Which I didn't...

I guess I just need to try and find out the margin (somehow!) or just live with it, my rate is more than acceptable but I don't want to be fleeced either, its the principle of the matter, I also do not want the clientco to pay more for me, I would want the agency to reduce their margin (if it was too high).