The Direct Approach

[infosec]

All of my contracts in the last 5 years have been direct to the client. (It's worth noting they have all been large ftse xxx companies, so I assumed payment would eventually arrive after jumping through various hoops).

For me its much nicer:
- you have the ability to present your business rather than being presented as a individual by the agency
- you can form direct business relations without having to get a 3rd party who are completely removed from day to day matters involved in any negotiations
- you know what your charging, no trying to guess if the agency is charging 30% on top of your rate
- easier to discuss larger increases if they like your services, you can gauge what they would go for when discussing a contract renewal
-you have the ability to bring in sub contractors which can be lucrative
- the fewer personalities involved, the less risk for issues to arise
- your free to develop relationships with other parts of the business who may need consultancy etc

So go for it - just remember to act as a professional business at all times…

[quackhandle]

I've done this a few times, it can work quite well.

I have found it helps to know the name(s) of the payroll staff. One quick mail direct to them can usually speed up "late" payments.

qh

[Platypus]

I only mention this because HMRC will only look at the end relationships (i.e. you and the end clientco you are working for).

Making the agency irrelevant ... n'est pas?

Direct is a good way to work, and it's actually B2B like a "proper" business.

[jamesbrown]

But at least you can. If you're working through an agent, you have no idea what's in the agent to client contract, and you don't know what kind of crazy promises the agent has made the client about the way you'll be working. After all, the agent doesn't care about your IR35 status; he just wants to make the sale.

Very true. From a purely IR35 perspective (which is, I agree, only part of the picture), a direct working relationship that is truly b2b - the best hallmark of which is lack of D&C - is always preferable to an indirect relationship via an agent where the upper contract may differ.

[SarahL2012]

One of my earliest contracts was for a small business that usually only took on perms or temps. He tried to get me to submit my invoice in week 3 of every month so he could arrange for me to be paid the same day as pay went through for the permies - so I wouldn't feel 'left out'.

He was quite easy to train though. We had a schedule of work in place, monthly invoices with a 7 day payment term and I even got him to sign a Confirmation of Arrangement letter at the end of the contract to make sure that there was no come-back on him in future months / years from an employment perspective. I drafted it and he jumped at the chance to sign it.

They were slow in paying though, but the advantage of a small business is you can get to know the accounts payable team quite well. I went on holiday when I finished the contract and the last invoice didn't get paid on time and had to be chased.

I much prefer to work direct than via an agency because then you really know what it is you are agreeing to deliver. Saying that there's one in the pipeline at the moment which is an agency intro and the credit terms of the end client are not good - so I'll want to go via the agency to reduce my risk on that one.

[VectraMan]

The contract and the reality of the working practices are what matters, of course, but I'd tend to share some of eek's skepticism given that "he usually only takes on permies". Chances are, he doesn't really understand the contractual relationship and working practices of a contractor, so you'll have to educate him/them upfront. If you can do that, and everyone is on the same page, it may work out. A draft COA might be a good starting point to test how amenable they are.

But at least you can. If you're working through an agent, you have no idea what's in the agent to client contract, and you don't know what kind of crazy promises the agent has made the client about the way you'll be working. After all, the agent doesn't care about your IR35 status; he just wants to make the sale.

[jamesbrown]

My advice would be make sure you're absolutely clear on payment terms, and that they're really going to stick to them.

Yes, good point. Payment terms can be either very bad or very good going direct, but often the former.

[jamesbrown]

The contract and the reality of the working practices are what matters, of course, but I'd tend to share some of eek's skepticism given that "he usually only takes on permies". Chances are, he doesn't really understand the contractual relationship and working practices of a contractor, so you'll have to educate him/them upfront. If you can do that, and everyone is on the same page, it may work out. A draft COA might be a good starting point to test how amenable they are.

[VectraMan]

How will you do it as a contractor? It may work out it may not but unless you are very careful you will end up in IR35 Moo hell.

It'd be nice, just once, to read something on this forum without someone turning it into a discussion on IR35. There's no mention of IR35 in his post, or as far as I can see, nothing that would suggest any kind of increased risk.

My advice would be make sure you're absolutely clear on payment terms, and that they're really going to stick to them. Worth checking out the company too; I worked for a very personable and down to earth chap who turned out not to have the funding he'd said he had with the end result of everything going down the tubes very fast with everybody owed money (about a month's worth in my case). Only afterwards did we find out he'd been previously disqualified from being a director. I think he's in prison now. Working through agents isn't necessarily all bad.

[eek]

why would I if my contract was outside of ir35 and my working practices are as well?

Try proving your working practices are as well. You need to have your contractural relationships 100% correct before you begin here otherwise you will be scupper end in the same way that I've seen others been in the past.

I only mention this because HMRC will only look at the end relationships (i.e. you and the end clientco you are working for). Someone I know got caught out when the end client vindictively answered the questions and didn't have the appropriate paperwork to extract him from the lies.

[NorthWestPerm2Contr]

How will you do it as a contractor? It may work out it may not but unless you are very careful you will end up in IR35 Moo hell.

why would I if my contract was outside of ir35 and my working practices are as well?

[eek]

Had an interesting few days speaking with agents last week and then got called directly by an MD.... He said he usually only takes on permies but one of my colleagues gave such a good reference for me that he would consider taking me on a contract basis.

Not even got into a discussion around rates yet, the gig would give me a lot of flexibility but also require me to work on client sites frequently (not something I necessarily mind). For me this is uncharted territories and completely different to the usual way I am used to things - Jobswerve, Agent, technical test, interview, contract etc....

It might open up new doors in itself. Had a long convo with the MD and it sounded very interesting indeed. Also found MD very personable and down to earth (good things said about him by mutual associate).

Have had 1 interview for a gig in midlands and waiting for another one locally, just not sure what to make of this one....

How will you do it as a contractor? It may work out it may not but unless you are very careful you will end up in IR35 Moo hell.

[NorthWestPerm2Contr]

Had an interesting few days speaking with agents last week and then got called directly by an MD.... He said he usually only takes on permies but one of my colleagues gave such a good reference for me that he would consider taking me on a contract basis.

Not even got into a discussion around rates yet, the gig would give me a lot of flexibility but also require me to work on client sites frequently (not something I necessarily mind). For me this is uncharted territories and completely different to the usual way I am used to things - Jobswerve, Agent, technical test, interview, contract etc....

It might open up new doors in itself. Had a long convo with the MD and it sounded very interesting indeed. Also found MD very personable and down to earth (good things said about him by mutual associate).

Have had 1 interview for a gig in midlands and waiting for another one locally, just not sure what to make of this one....