Reply to: Best way to negotiate rate increase

[Sausage Surprise]

Going forward you may wish to make a note of how you spell extension....

[singen smythe]

Not for your IR35 status it didn't

I was thinking about that, not that the job offer was a continuation of the work in my contract as the project itself is coming to an end with all the contractors getting the boot.

Anyhow, very unlikely I will stay even if a contract extention was offered as I'm looking forward to a change of surroundings.

[northernladuk]

Sorry it took so long get back on this, but I did get the increase I asked for, the agent was apprehensive but after asking the client they accepted pretty quickly (2 hours) and contract was extended.

A month or so back I was asked if I would consider a perm position at the end of this year.

So all in all it turned out well.

Not for your IR35 status it didn't

[singen smythe]

Sorry it took so long get back on this, but I did get the increase I asked for, the agent was apprehensive but after asking the client they accepted pretty quickly (2 hours) and contract was extended.

A month or so back I was asked if I would consider a perm position at the end of this year.

So all in all it turned out well.

[7specialgems]

I asked for +inflation at the beginning of the last financial year when offered an extension.

I found out that the agent agreed it with ClientCo before the agent said no to me.

I may have made mention to this to the ClientCo, I may still be at the ClientCo, I may have my increase and I may now have a different agent

What we learnt in this case is that an agent may say no to you, but have a little check with the other side if you can...and I bet you find that ClientCo are paying a little bit more...

[Ruprect]

The only real way to get a rate increase you're happy with is to move contracts.

[MyUserName]

I explained that I needed the rate increase due to the fact that I had hit the 24 month rule and required a rate increase to make up the difference. Although, technically, it makes the difference up within a day or so the rest is just more profit but I did not go into details as no one asked.

It worked (took some seriously cunning manoeuvres but it worked).

[SteelyDan]

your four months into your first contract, the other guy whilst he may have been useless at his job may have been more experienced than you and a better negotiator, hence they paid him more money in the first place

^ this.

It always seems to be the case that when ppl find out how much the previous incumbent was on, that the green eyed greedy monster comes out. You were happy with your rate when you started, but since finding out the previous guy was on more, you now want more...because (in your mind) you're better and more worthy...

On my current contract, I asked for an increase in rate after my 3rd extension, and I got it. There had not been a previous incumbent to compare against, but my experience told me that what I was being asked to do was worth more than they were currently paying me. The role requirements had changed significantly from the initial contract.

But, what I had to do was justify it to the both the agency (low fixed margin) and the client; a simple brief one pager with my reasons for requesting the increase, backed up by evidence of recent similar roles in similar geographical area. By going through this process I felt totally justified in the increase request, & like I said, I got the increase.

Point is, go through this similar exercise yourself and see if you still feel justified in the rate increase request. If not, stick with the rate you signed up for and were happy with, or get another contract at the rate you require...

[sunflower]

Check your contract terms and conditions as well. Some of the agencies have clauses in there "in the event of an extension, the same rate will apply".

[DirtyDog]

The other said that's the going rate for the role I was doing (it wasn't).

There's no such thing as a "going rate" - it's what everyone can agree on.

"That may be what you think the going rate is, but this is where your rate gets me going..."

[lukemg]

There are some problems with your approach
- 17% is a large rise from here (better to dig hard on the way in but you couldn't cos as you say this was a way to get you in the game). Previous chap looks like he did this.
- you dont have another offer, can you afford to play hardball ?
- Agent is on fixed % - if this is true, it is likely to be a reasonable % - then it means a chat with the client for any rise, making you look greedy.
- It's only been 6 months, after 12 I feel more comfortable putting in for one as a yearly rise is a bit easier to justify.
BUT, it does look like you have been low-balled on the rate so if you can live with upsetting a few people, wait for the extension offer and say yes, but I am looking for x% increase in the rate - I would suggest x= 10 at most (DON'T try to justify or explain, leave it as is but if pressed for a reason, state the current level is below market rate for the role, evidenced by previous incumbent)
Then shut up and let them try to talk you out of it, pretend to phone the client then say they said no etc etc.
When they pause for breath, restate you are looking for another 10% (client will already know you are cheap if the agent isnt creaming off the top).
Leave it in their court, start looking for other options and let the clock run down.
Unless they withdraw the offer completely (unlikely but possible), you have until close to the end date to change your mind.
Good luck....

[Support Monkey]

Hi there,
I'm four months into my first six month contract and I've been asked by the line manager if I'd consider doing another six months on another project which they are looking to get into next years budget.

I'm actually a month or so ahead of shedule and I'd happily do another six months as the place is pretty easy going and the work not particularly difficult but they're happy so it's all good.

Now the only issue is my rate, the guy I replaced (who was hopeless) I found out was earning £100 or so a day more than me so I'd like to have a rate rise with the new project. I'd like to do this next project as I'm led to believe that it would look good on the CV that I got extended so I don't want to push too hard. However on the other hand I am probably working at below market rate.

So the question is, how should I go about this? Just wait for the extention and then demand the extra from the agent? Is it expected that there will be a rate increase if there is an extention?

Any thoughts would be appreciated.
Thanks in advance.

your four months into your first contract, the other guy whilst he may have been useless at his job may have been more experienced than you and a better negotiator, hence they paid him more money in the first place

[MyUserName]

Put yourself in the agent's shoes. Why should he simply accept a pay cut because you have asked him too. You won't leave just because of it as you were happy with the rate a few months ago and he can just blame the client and say they won't budge.

If you ask about his margin he will laugh and explain that it is a fixed commission set by the company, cannot be varied due to contract reasons, their pay structure does not work like other agencies, he has forgotten his password and can't change it, he is already on the minimum commission, his mother is sick etc.

The upshot is you won't leave if he says no so he'll say no.

... unless you will?

[kal]

Have tried this twice in my contracting career. Found out on both occasions that I was being raped by the agent so asked for a modest £25 a day increase (agent was taking £150 in one case and £115 in the other).

Both refused. One said client wouldn't up the rate (but that wasn't where I was expecting the rate increase to come from). The other said that's the going rate for the role I was doing (it wasn't).

They called my bluff, so in both instances I walked (having already negotiated a new role).

That's what you've got to be prepared to do.

[Sausage Surprise]

Have tried this twice in my contracting career. Found out on both occasions that I was being raped by the agent so asked for a modest £25 a day increase (agent was taking £150 in one case and £115 in the other).

Both refused. One said client wouldn't up the rate (but that wasn't where I was expecting the rate increase to come from). The other said that's the going rate for the role I was doing (it wasn't).

They called my bluff, so in both instances I walked (having already negotiated a new role).