Contractors - You still think it is worth it?
Discussion
schmunk said:
bucksmanuk said:
If I was staff I would be on £55-60K. Salaries have not really risen in about 4 years- I don’t care what some turd in HR says.
To take home what I do, I would need to be on £107.8K p.a. according to Excel, and that’s with 5 weeks holiday a year, which I do take, 2 days sick and all the bank holidays. That’s also with a fairly hefty pension contribution as well.
That seems like quite a difference. What's your day rate to achieve that, out of interest?To take home what I do, I would need to be on £107.8K p.a. according to Excel, and that’s with 5 weeks holiday a year, which I do take, 2 days sick and all the bank holidays. That’s also with a fairly hefty pension contribution as well.
PurpleTurtle said:
I was offered permie a couple of years ago but they were £5k adrift of my permie salary expectations. The hiring manager said personally I've no problem paying it you, but it puts you beyond the maximum salary for the job grade, so HR won't wear it .... it was then I was reminded that I've had two decades of not being involved in any kind of HR bulls
t, or being forced down a 'management' path - I am a techie - which sits perfectly fine with me.
And this in bold is why I hate HR with a vengeance. t, or being forced down a 'management' path - I am a techie - which sits perfectly fine with me. The company needs you.
The department wants your skills.
They have no issue with the salary requested.
But HR won’t wash it. Who do these stupid t
ts think they are? Everyone wants to be the gate keeper, and to hell with product/project delivery. The level of animosity I’ve received from HR at some induction briefing when arriving as a contractor has been unbelievable. They really don’t like contractors. Surely you get the people in you need to get the job done? I am under no illusion the HR department in question probably just stood there with their usual weak bulls
t response of “we can’t get the staff…” 
This cretinous bleating goes on for weeks, with the project getting later and later, until the project manager storms into the MD’s office and brings it to his/her attention as to how late this project is getting and penalty clauses are just about to start coming over the hill. Then the magic cheque book comes out, HR is circumnavigated and the contractors arrive. No increase in headcount, just a timesheet to sign and an invoice to pay. No more HR b
ks. My ex fiancé worked in HR, this is VERY close to reality- and yes, they don’t like contractors.I have been very concerned about off shoring “my” work, but it’s coming back as certain parts of the globe can talk the talk, but never seem to actually deliver anything of actual merit. I decided to stay in defence projects, so the work stays in the UK, I pick contracts that keep my SC going, are interesting work, not that far from home, and because YOU, the taxpayer are so generous, pay me a good rate, which I then take 77% of it home. I recognise the irony in that last line as well….
Although I keep my eyes on the IR35 issues as well.
I know of a health authority which is now in chaos as the contractors in the finance team (75% of them) walked out – it’s been a disaster.
There’s rumours of an MOD project/site which introduced IR35 and so many walked off - it’s had a serious effect on a cyber security program delivery.
bucksmanuk said:
PurpleTurtle said:
I was offered permie a couple of years ago but they were £5k adrift of my permie salary expectations. The hiring manager said personally I've no problem paying it you, but it puts you beyond the maximum salary for the job grade, so HR won't wear it .... it was then I was reminded that I've had two decades of not being involved in any kind of HR bullst, or being forced down a 'management' path - I am a techie - which sits perfectly fine with me.
And this in bold is why I hate HR with a vengeance. t, or being forced down a 'management' path - I am a techie - which sits perfectly fine with me. The company needs you.
The department wants your skills.
They have no issue with the salary requested.
But HR won’t wash it. Who do these stupid t
ts think they are? Everyone wants to be the gate keeper, and to hell with product/project delivery. The level of animosity I’ve received from HR at some induction briefing when arriving as a contractor has been unbelievable. They really don’t like contractors. Surely you get the people in you need to get the job done? I am under no illusion the HR department in question probably just stood there with their usual weak bulls
t response of “we can’t get the staff…” This cretinous bleating goes on for weeks, with the project getting later and later, until the project manager storms into the MD’s office and brings it to his/her attention as to how late this project is getting and penalty clauses are just about to start coming over the hill. Then the magic cheque book comes out, HR is circumnavigated and the contractors arrive. No increase in headcount, just a timesheet to sign and an invoice to pay. No more HR b
ks. My ex fiancé worked in HR, this is VERY close to reality- and yes, they don’t like contractors.I have been very concerned about off shoring “my” work, but it’s coming back as certain parts of the globe can talk the talk, but never seem to actually deliver anything of actual merit. I decided to stay in defence projects, so the work stays in the UK, I pick contracts that keep my SC going, are interesting work, not that far from home, and because YOU, the taxpayer are so generous, pay me a good rate, which I then take 77% of it home. I recognise the irony in that last line as well….
Although I keep my eyes on the IR35 issues as well.
I know of a health authority which is now in chaos as the contractors in the finance team (75% of them) walked out – it’s been a disaster.
There’s rumours of an MOD project/site which introduced IR35 and so many walked off - it’s had a serious effect on a cyber security program delivery
My working hours are my own and apart from Conf calls I could be here, there or anywhere but usually WFH.
My rate is just a tad less than the poster above. I have 4 conf calls per week and normally visit site (Not the offices but the DC's, the nearest office is 90 miles from me.) once or twice a month if someone needs hosting or I expect a delivery.
As for the MOD I know they were having issues in Corsham and DEFRA were getting stuffed as were the NHS as you said. And a few of the Councils I contracted for and have kept in contact with.
Edited by Allanv on Wednesday 4th October 20:27
Edited by Allanv on Wednesday 4th October 20:36
Still worth it, take home is still about double a permie minion.
But even if the money was the same I'd still be a contractor, I like going home at 5pm to spend time with my kid and don't have to play office politics. Also I've been contracting continuously ever since I started 6 years ago (at different companies and in different roles if anyone from HMRC is reading) so the job security argument for a permie doesn't hold water.
But even if the money was the same I'd still be a contractor, I like going home at 5pm to spend time with my kid and don't have to play office politics. Also I've been contracting continuously ever since I started 6 years ago (at different companies and in different roles if anyone from HMRC is reading) so the job security argument for a permie doesn't hold water.
Interesting and timely discussion for me!
I've been permy with the same company for 22 years now, and although it's a large multinational actual opportunities for advancement in my field are very slim. I am lucky that I get the really interesting jobs and am generally the go-to guy to get stuff sorted so the work is good...I also have anything between 5-10 contractors working for me at any one time so I have a really good idea of the rates we are paying and my permy take home just doesn't stack up.
For me the downsides of dealing with office politics, little chance of meaningful advancement and the lower pay is making me seriously consider moving onto contracting. If I do and I can command a similar rate to the guys we recruit I could be looking at an almost immediate jump of 80-100% in take home.
It's a daunting thing leaving a company I've spent so long with and losing the security that comes with it...but I am thinking now is about the right time to get it done!
I've been permy with the same company for 22 years now, and although it's a large multinational actual opportunities for advancement in my field are very slim. I am lucky that I get the really interesting jobs and am generally the go-to guy to get stuff sorted so the work is good...I also have anything between 5-10 contractors working for me at any one time so I have a really good idea of the rates we are paying and my permy take home just doesn't stack up.
For me the downsides of dealing with office politics, little chance of meaningful advancement and the lower pay is making me seriously consider moving onto contracting. If I do and I can command a similar rate to the guys we recruit I could be looking at an almost immediate jump of 80-100% in take home.
It's a daunting thing leaving a company I've spent so long with and losing the security that comes with it...but I am thinking now is about the right time to get it done!
Financially it works for me, but what is even better is the interesting roles and work I get to do. As a permie I was limited by people senior to me, couldn't just be dropped into stuff I could do because of my title or alignment with a particular part of the company - now I get put onto stuff with no concern to any of that nonsense - just on the basis that I know what I'm doing and get on with it.
It's a win-win as on paper I'm far cheaper than as a fully loaded permie cost for a division, earn more than as a permie and have done more in 2 years in both diversity and seniority than in 10 years of pushing my career in what I saw as the conventional way.
I think if you've got a good network, are able to get stuff done and behave like an adult - you can only do well as a contractor. I haven't been impacted by outsourcing as I got out of the pure techie stuff 11 years ago.
It's a win-win as on paper I'm far cheaper than as a fully loaded permie cost for a division, earn more than as a permie and have done more in 2 years in both diversity and seniority than in 10 years of pushing my career in what I saw as the conventional way.
I think if you've got a good network, are able to get stuff done and behave like an adult - you can only do well as a contractor. I haven't been impacted by outsourcing as I got out of the pure techie stuff 11 years ago.
Shaoxter said:
Still worth it, take home is still about double a permie minion.
As a permanent employee in an accountancy-type role, I don't get how this can be. For me to double my real 'take home', including net salary, bonus, employer pension contributions and other benefits (e.g. medical), I'd apparently need to invoice £700/day, but looking at salary guides, realistically I'd only get £450-500/day. That's a huge difference, even before considering I get 35 days paid leave per year (inc. bank holidays), which I use and would want to keep using.
Is IT perm/contractor pay really so different?
schmunk said:
As a permanent employee in an accountancy-type role, I don't get how this can be.
For me to double my real 'take home', including net salary, bonus, employer pension contributions and other benefits (e.g. medical), I'd apparently need to invoice £700/day, but looking at salary guides, realistically I'd only get £450-500/day. That's a huge difference, even before considering I get 35 days paid leave per year (inc. bank holidays), which I use and would want to keep using.
Is IT perm/contractor pay really so different?
Not sure about IT or accountancy contracting but as an engineer with 12 years experience I'd say my potential permie salary range is £50-£60k (obviously including holiday/sick pay and some perks such as BUPA & Pension Contribution).For me to double my real 'take home', including net salary, bonus, employer pension contributions and other benefits (e.g. medical), I'd apparently need to invoice £700/day, but looking at salary guides, realistically I'd only get £450-500/day. That's a huge difference, even before considering I get 35 days paid leave per year (inc. bank holidays), which I use and would want to keep using.
Is IT perm/contractor pay really so different?
Lets say the pension is worth £1800 (3% of £60k) and the BUPA £1500, so £3300 in perks. So top line is £63k with a take home of £42,579.68 (using an online salary calculator).
Last year I worked about 2000 hrs and had 5 weeks holidays plus the odd long weekend. No sick days.
My net income was circa £65k which would require a £110k permie salary. So nowhere near double but a healthy chunk on top in my instance.
bucksmanuk said:
And this in bold is why I hate HR with a vengeance.
The company needs you.
The department wants your skills.
They have no issue with the salary requested.
But HR won’t wash it. Who do these stupid tts think they are? Everyone wants to be the gate keeper, and to hell with product/project delivery. The level of animosity I’ve received from HR at some induction briefing when arriving as a contractor has been unbelievable. They really don’t like contractors.
Surely you get the people in you need to get the job done? I am under no illusion the HR department in question probably just stood there with their usual weak bullst response of “we can’t get the staff…”
But...by the time you've paid for overheads such as HR, Finance, IT, buildings & maintenance, etc, etc, plus holidays, sick leave, pensions and the rest, the cost of a permanent staff is around 2 to 2.5 times their salary. So to my mind it's perfectly legitimate to say they can't afford to pay a full timer the rate they can pay a contractor. I'm a permie in a company that uses a lot of contractors and my internal charge out rate is double what we pay contractors with more experience than me, although I do think part of that is due to a slightly flawed model as IMO we have too many overheads and more should be booked as project specific.The company needs you.
The department wants your skills.
They have no issue with the salary requested.
But HR won’t wash it. Who do these stupid t
ts think they are? Everyone wants to be the gate keeper, and to hell with product/project delivery. The level of animosity I’ve received from HR at some induction briefing when arriving as a contractor has been unbelievable. They really don’t like contractors. Surely you get the people in you need to get the job done? I am under no illusion the HR department in question probably just stood there with their usual weak bulls
t response of “we can’t get the staff…” 22nd November is the date for the Autumn Budget, we should then get a clearer idea as to what they have in store for the private contractor sector.
It was heavily mooted when the changes were made in public sector contracting this April that those changes would be applies to private next April. But it seems to have been fairly quiet since. The mayhem caused in the public sector has been kept relatively quiet too.
It's worth keeping an eye on the IPSE website for opinion and updates (Independent Professional and Self-Employed):
https://www.ipse.co.uk/news
Read here also an article by the ISPE with opinion regarding the upcoming Autumn Budget:
https://www.contractorcalculator.co.uk/iipse_urges...
It was heavily mooted when the changes were made in public sector contracting this April that those changes would be applies to private next April. But it seems to have been fairly quiet since. The mayhem caused in the public sector has been kept relatively quiet too.
It's worth keeping an eye on the IPSE website for opinion and updates (Independent Professional and Self-Employed):
https://www.ipse.co.uk/news
Read here also an article by the ISPE with opinion regarding the upcoming Autumn Budget:
https://www.contractorcalculator.co.uk/iipse_urges...
XJ75 said:
Depends on the difference between perm salary and contractor day rate, which is largely dependent on the industry.
In my industry (IT within Investment Banking), the difference is pretty substantial and even if I was inside IR35 I'd still be better off contracting.
When I compare on a gross basis, even assuming a 10% bonus, 10% pension and about £2k worth of other benefits, the equivalent perm package still works out £30k less and that assumes that as a contractor I take 5 weeks holiday, which I never do.
I don't even think the case for perm job security is valid any more. Most big cost cutting drives result in perm redundancies with firms preferring to keep hold of contractors to remain "tactical".
Genuine question why are you assuming such a low 10% bonus ? In my industry (IT within Investment Banking), the difference is pretty substantial and even if I was inside IR35 I'd still be better off contracting.
When I compare on a gross basis, even assuming a 10% bonus, 10% pension and about £2k worth of other benefits, the equivalent perm package still works out £30k less and that assumes that as a contractor I take 5 weeks holiday, which I never do.
I don't even think the case for perm job security is valid any more. Most big cost cutting drives result in perm redundancies with firms preferring to keep hold of contractors to remain "tactical".
As an example in my company those who are on bonus grade the tiers start at 20% as you go up then 100% is the level (beyond that I've not had sight of the package but share options in addition to 100% or simply uncapped. ).
Welshbeef said:
Genuine question why are you assuming such a low 10% bonus ?
As an example in my company those who are on bonus grade the tiers start at 20% as you go up then 100% is the level (beyond that I've not had sight of the package but share options in addition to 100% or simply uncapped. ).
I think 10% is a fair average.As an example in my company those who are on bonus grade the tiers start at 20% as you go up then 100% is the level (beyond that I've not had sight of the package but share options in addition to 100% or simply uncapped. ).
Dr Jekyll said:
Welshbeef said:
Genuine question why are you assuming such a low 10% bonus ?
As an example in my company those who are on bonus grade the tiers start at 20% as you go up then 100% is the level (beyond that I've not had sight of the package but share options in addition to 100% or simply uncapped. ).
I think 10% is a fair average.As an example in my company those who are on bonus grade the tiers start at 20% as you go up then 100% is the level (beyond that I've not had sight of the package but share options in addition to 100% or simply uncapped. ).
What sector are you in?
Also people are overlooking paternity leave (we've had kids whilst I've worked in different companies I've had full pay for all 3 kids not statutory).
3% employers pension contribution is low too especially for the more senior roles/middle mgt.
Redundancy
Ease of mortgage approval
Welshbeef said:
Does everyone else ? - specifically perms to respond.
What sector are you in?
Also people are overlooking paternity leave (we've had kids whilst I've worked in different companies I've had full pay for all 3 kids not statutory).
3% employers pension contribution is low too especially for the more senior roles/middle mgt.
Redundancy
Ease of mortgage approval
When I was permie I never received anything like 10%, I don't think the current company I'm contracting with have paid any bonuses in 3+ years.What sector are you in?
Also people are overlooking paternity leave (we've had kids whilst I've worked in different companies I've had full pay for all 3 kids not statutory).
3% employers pension contribution is low too especially for the more senior roles/middle mgt.
Redundancy
Ease of mortgage approval
Paternity leave I'll just suck it up when it comes to it and take 2 weeks unpaid. The missus is permie so she gets the full shebang.
3% pension contribution is what my company offered, might be able to push it to 5% but it doesn't make much difference to my figures.
Redundancy payments? I've never been made redundant (touches wood) so not something I've ever factored in.
Mortgage approval was no issue for me once 2 years books were available.
schmunk said:
bucksmanuk said:
If I was staff I would be on £55-60K. Salaries have not really risen in about 4 years- I don’t care what some turd in HR says.
To take home what I do, I would need to be on £107.8K p.a. according to Excel, and that’s with 5 weeks holiday a year, which I do take, 2 days sick and all the bank holidays. That’s also with a fairly hefty pension contribution as well.
That seems like quite a difference. What's your day rate to achieve that, out of interest?To take home what I do, I would need to be on £107.8K p.a. according to Excel, and that’s with 5 weeks holiday a year, which I do take, 2 days sick and all the bank holidays. That’s also with a fairly hefty pension contribution as well.
Welshbeef said:
Does everyone else ? - specifically perms to respond.
What sector are you in?
Also people are overlooking paternity leave (we've had kids whilst I've worked in different companies I've had full pay for all 3 kids not statutory).
3% employers pension contribution is low too especially for the more senior roles/middle mgt.
Redundancy
Ease of mortgage approval
I've had the top level bonus for my company and it works out about 15% The average would be closer to 10%.What sector are you in?
Also people are overlooking paternity leave (we've had kids whilst I've worked in different companies I've had full pay for all 3 kids not statutory).
3% employers pension contribution is low too especially for the more senior roles/middle mgt.
Redundancy
Ease of mortgage approval
What I can actually get is also based on how the company did as well as my personal and business unit performance. I am a manger level for comparison.
Also for salary depending on share performance and bonus it's something like £80-£100k pre tax.
As an IT project manager as a CW I would be looking at £600-£700 per day as a project manager and £700-£800 as a programme manager.
Edited by mathmos on Thursday 5th October 13:48
mathmos said:
Welshbeef said:
Does everyone else ? - specifically perms to respond.
What sector are you in?
Also people are overlooking paternity leave (we've had kids whilst I've worked in different companies I've had full pay for all 3 kids not statutory).
3% employers pension contribution is low too especially for the more senior roles/middle mgt.
Redundancy
Ease of mortgage approval
I've had the top level bonus for my company and it works out about 15% The average would be closer to 10%.What sector are you in?
Also people are overlooking paternity leave (we've had kids whilst I've worked in different companies I've had full pay for all 3 kids not statutory).
3% employers pension contribution is low too especially for the more senior roles/middle mgt.
Redundancy
Ease of mortgage approval
What I can actually get is also based on how the company did as well as my personal and business unit performance.
I'd say that for the majority 10% is a good yardstick. Many will (expect to) receive somewhat less than this.
Dr Jekyll said:
Welshbeef said:
Genuine question why are you assuming such a low 10% bonus ?
As an example in my company those who are on bonus grade the tiers start at 20% as you go up then 100% is the level (beyond that I've not had sight of the package but share options in addition to 100% or simply uncapped. ).
I think 10% is a fair average.As an example in my company those who are on bonus grade the tiers start at 20% as you go up then 100% is the level (beyond that I've not had sight of the package but share options in addition to 100% or simply uncapped. ).
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