Hourly vs daily rate for contract

[northernladuk]

No he's not. He's an employee and/or director of a business that supplies a service to its clients. In that capacity, he's just as liable to work overtime as anybody else with a job.

Ok your point is valid but it isn't 'overtime' it would be 'extra time'. Pedantry about the terminology I guess but I think it is important to use the correct term if you are going to differentiate yourself as a company from a permie. To a permie it is over and above his contracted hours, to me it's extra billable work.

[thunderlizard]

Contractors don't work overtime, permies do that. You are business supplying a service to your client.

No he's not. He's an employee and/or director of a business that supplies a service to its clients. In that capacity, he's just as liable to work overtime as anybody else with a job.

[SueEllen]

I've been on daily rates and hourly rates. With both I've had a maximum time I billable for i.e. x hours per week after that time the client won't pay.

It's best to ask the client when you meet them when do people typically start there working day in this company.

This allows you to:
1. Avoid clients who won't give you a direct answer
2. Find clients who are flexible i.e. you can work 6 days one day and 10 hours another day
3. Get the right working hours into your contract as lots of agencies put 8 hours when the client only wants you to work 37.5 hours a week.

[formant]

Gotta love how we've got firm answers in both directions - Daily Rate now being the norm, vs. Hourly Rate still being the norm.

I'm on hourly, but I'm not entirely full time so that was the obvious choice for this contract. I would avoid a daily rate if possible, as I prefer to be flexible about my working times and hours over several days and at least my current client's system wouldn't allow me to enter more than the 7.25 hr company work day if I was on a day rate.

[d000hg]

No. But some clients prefer it because they can lean on you to work unpaid extra hours.

It's not extra unpaid hours if you didn't agree what the hours were.

Yep, hourly rates disappeared in the late 90's really. Look at Jobserve for yourself and get a feel for the market. Just multiply your old hourly rate by 7.5

I'm hourly but I'd agree this isn't the norm.

[jamesbrown]

Contractors don't work overtime, permies do that.

Yes, on the semantic point of "overtime", but contractors working on a T&M basis operate according to their contract. For example, my main contract has an hourly rate with a ceiling on what I can bill over the lifetime of the contract. In practice, I work whatever hours/weeks I decide to work in order to meet the deliverables and with a view to the contract ceiling. Most days on this contract, I put in something like 7-9 hours, but other days I'll put in 11 hours or none depending on other work and what I feel like doing.

My view on working without pay is that it's a business, not a charity. If that's the scenario, I'm looking for a fixed-price contract with a fixed price that has a good margin. Afterall, it's impossible to know precisely how long it will take to meet certain deliverables. Why take on unnecessary business risks? The important thing is to think about this stuff at the outset though, not halfway through.

[Wanderer]

I was a little suprised that my new contract is specified a daily rate rather than the hourly rate I was used to in my previous contracting experience. On querying this I was told it is "usual practice" now - is this the case?

Yep, hourly rates disappeared in the late 90's really. Look at Jobserve for yourself and get a feel for the market. Just multiply your old hourly rate by 7.5

As a contractor, is it appropriate to be firm in not working unpaid overtime? I'm not so bothered about being seen as "not a team player" as I might be for a permanent role.

Tough call. It depends on the job and what the rate is, doesn't it. I tend to earn a bit of good will and go the extra mile and when there is a one off crisis but if they lurch from crisis to crisis then I'll have a discussion about billing them for my extra time. I don't subscribe to this "overtime is for permies" nonsense - I'm a businessman and my time is money.

If it's a project that's lagging behind then once again, I'll put in extra work to catch up as a goodwill gesture but that doesn't last forever. If they are constantly expecting me to work more than 35-40 hours a week then I'm going to push back on them and tell them they need to up the rate, pay me for a few extra days, get some more resource or back off with their requirements.

Also, as an IT contractor, is it usual practice to be expected to supply my own laptop for use in the office?

In my experience, some clients are hostile to people bringing their own devices to work, primarily for information security and protection from malware though it's generally accepted as being OK if you don't connect it to the client's network.

If they ask you to bring your own device then you have to factor the cost of this into the contract. A laptop doesn't cost much more than a couple of billable days though, so I can't see that it would be too onerous if a client required a contractor to supply their own one.

[Brussels Slumdog]

Fixed Contract plus expenses

I currently have a contract to supply 40 days over 3 months at a fixed amount plus a fixed expense amount . You can agree to work for whatever terms you want

[Boo]

I was a little suprised that my new contract is specified a daily rate rather than the hourly rate I was used to in my previous contracting experience. On querying this I was told it is "usual practice" now - is this the case?

No. But some clients prefer it because they can lean on you to work unpaid extra hours. For that reason I have never accepted a daily rate role and would walk rather than do so, but you are of course free to feel differently

As a contractor, is it appropriate to be firm in not working unpaid overtime? I'm not so bothered about being seen as "not a team player" as I might be for a permanent role.

I would never work for free, contractor or not, and frankly couldn't g.a.s. about the "team player" bowlocks. They don't come looking for "team players" when the directors chuck each other wads of notes across the table at the end of the year so they can take a hike the rest of the time too.

Also, as an IT contractor, is it usual practice to be expected to supply my own laptop for use in the office?

It's quite unusual IME, generally the client will much prefer you to use their equipment, for a variety of reasons. It is a minor pointer to IR35 status however and as a nod in that direction I have had some success in persuading clients to accept me providing my own keyboard, mouse and display to use on their computer. I do this for ergonomics reasons more than the IR35 angle tbh.

Hth,

Boo

[psychocandy]

Late 90s it was mostly hourly rates. Coming back to contracting in the last few years I found it was mostly day rates.

Not so keen on daily because the potential for piss taking by clients is there. Gotta watch what you agree to. Aim is to let the client think they're getting unlimited days for one price but in reality you aint doing more than 8 hours max overall. :-)

[northernladuk]

I'm just about to start contracting again after some time in a permanent position.

I was a little suprised that my new contract is specified a daily rate rather than the hourly rate I was used to in my previous contracting experience. On querying this I was told it is "usual practice" now - is this the case?

As a contractor, is it appropriate to be firm in not working unpaid overtime? I'm not so bothered about being seen as "not a team player" as I might be for a permanent role.

Also, as an IT contractor, is it usual practice to be expected to supply my own laptop for use in the office?

Why not have a search on jobserve or similar site and find out first hand?

Contractors don't work overtime, permies do that. You are business supplying a service to your client. Some people do, some people don't. It's your choice how you present yourself to your client and whether you work to rule or go the extra mile but you must be firm when they try to take the piss.

It isn't expected to supply laptop in general as most companies now have policies regarding ant-virus, connection of 3rd party equipment to networks so will likely get a company one to use. Don't take this for granted. As a small business/contractor you should be able to provide your own equipment. What IT business doesn't own a laptop to work on. Permies take it for granted they are given laptops, contractors can't.

I think you need to spend some time understanding the differenc between a contractor and a permie and read up very carefully on IR35.

[Peregrine66]

I'm just about to start contracting again after some time in a permanent position.

I was a little suprised that my new contract is specified a daily rate rather than the hourly rate I was used to in my previous contracting experience. On querying this I was told it is "usual practice" now - is this the case?

As a contractor, is it appropriate to be firm in not working unpaid overtime? I'm not so bothered about being seen as "not a team player" as I might be for a permanent role.

Also, as an IT contractor, is it usual practice to be expected to supply my own laptop for use in the office?