Reply to: Rate Cut Rumours...

[expat]

Did anyone have the guts to return the favour last time around? After a rate cuts when the economy improved did they find a new contract and give them 48 hours to decide on a rate increase?

It's a tempting idea, but it would seem a hollow victory, or Pyrrhic for those of a classical disposition. My guess is that most clients would be shocked at your insolence, and drop you instantly. You would find out that they do indeed regard you as an employee: how it should work is that they offer work when they feel inclined, and you take what you get. Break that mould and they will hate you.

[d000hg]

It must be galling - finding out how many are paid more than you!

Heh, not really. I've only just got into contracting so the fact my £250-300/day is lower than you guys is far outweighed by the fact that my income for my just-finished first year is pretty much 2X my previous salary, despite the fact I worked 100% from home instead of having to take the train

[vetran]

anyone with Balls?

Did anyone have the guts to return the favour last time around? After a rate cuts when the economy improved did they find a new contract and give them 48 hours to decide on a rate increase?

Just curious? We got canned before the rate cuts (not direct customers fault Peter was a real gentleman, it was the end clients discovery of cheap imports) so I never got the chance.

[Ivor Bigun]

Well if you must stay in 5* hotels...

It must be galling - finding out how many are paid more than you!

In a deal, "if you don't know who the mark is, then its you".
Also, the reason why you don't know is because the ones that employ you are thinking "never give a sucker an even break"

[Ivor Bigun]

Thanks a million.

Best to think that you've just got a new contract so you're safe for the time being.
When you get into work, put a smile on your face and be grateful - You're still earning.
As many say - 90% looks fantastic from 0%

Consider that there's plenty of hungry types who'd love to replace you for a lot less.

[d000hg]

No - I meant "accept the cut but jump as soon as the next contract appears"

5% is nothing... maybe the rate he has is substantially more than any new contracts might offer, especially if other companies in the same sector are cutting 10-15% or more.

Surely the same logic as ever applies - if a substantially better contract comes along, give notice and jump ship. 5% just changes the definition of 'slightly' slightly

[EternalOptimist]

Thanks a million.

I was trying to cheer you up by telling you how bad things really are

[BrilloPad]

Cheers fella.

Yeah, I agree. I was expecting a lot worse.

The pessimist/realist in my suggests that this may not be the only cut though. I can see this being repeated when they realise they need to save more money...

IMO too pessimistic by far!! You know took I 15% cut at end Nov? A few left as they could just not afford it! They come from "up north" (where the f**k is that?) so have large travelling/accomodation expenses.

You and me live in London so can can afford to take a few cuts : others will go long before us!

Chin up old bean!

[Ravello]

Sorry to hear that Xeno.

FWIW, I'd take the hit and keep an eye out for other opportunities. To my mind, unless someone has got an alternative already in place it's usually worth taking the reduction and searching whilst still in contract.

By the looks of things that's what you've decided already, but from a pure geeky maths view, if you left and were benched for only a month you'd have to work for something like 19 months to make up for the lost revenue:

Assuming £500p/d current rate (no idea what you're on, but this keeps the maths easy) for the same reason, assuming 20 working days in the month:

before reduction
500*20 = £10k

after reduction
475*20 = £9.5k (£500 less per month)

If you walk
500*0 = £0 (£9.5k opportunity loss)

New contract comes along at original rate of £500p/d, back to £10k per month, it will now take 19months for the extra £500 per month to make up for the £9.5k you missed through walking...

[Xenophon]

...are they on a government dripfeed too?

Yes indeed.

Majority owned, etc...

[Xenophon]

Yes, very fly, The first thing my manager said was "well RBS & HBOS are all getting 15% drops as well"

5%-15% at RBS...

[Xenophon]

my 2c

You are in business to maximise your profits. If you earn 400 a day and have expenses of 300, your profit is 100 per day.

A 5% cut to the rate will reduce your profit to £80 per day.

They aint giving you a 5% cut, it's a 20% cut.

Thanks a million.

[Mich the Tester]

Cheers fella.

Yeah, I agree. I was expecting a lot worse.

The pessimist/realist in my suggests that this may not be the only cut though. I can see this being repeated when they realise they need to save more money...

...are they on a government dripfeed too?

[cojak]

A new contract because of a 5% cut seems pretty extreme. Or did you mean "look for a new contract 'cos you ain't getting renewed"?

No - I meant "accept the cut but jump as soon as the next contract appears"

[Xenophon]

Sorry to hear that.

But in these troubled times it could have been worse. Might be the best way to look at it?

Cheers fella.

Yeah, I agree. I was expecting a lot worse.

The pessimist/realist in my suggests that this may not be the only cut though. I can see this being repeated when they realise they need to save more money...