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Switch to a contract from perm, advise?

Discussion in 'Employment & Jobs' started by Dubfire, Sep 3, 2008.

  1. Dubfire

    Dubfire Byte Poster

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    Good evening, advice needed...

    Just started a 1st/2nd line support role with around another 5 people on a brand spanking new project.

    Couldnt of wished for a better gig there is loads of room for moving up the ladder to 3rd line, network instalations etc its also very laid back and with the organ grinders already pushing the team toward courses such as ITIL and others..Anyway, Thats the good part...

    Problem is ive found out that I am the only one of the group on a perm rather than the rest being long term contract. Thats Because i applied early and at that point they only were offering perm because the company struggled to find suitable candidates through the door. The job is still advertised as both as a choice of contract or perm.

    The reason for posting? The contact guys are taking home around a grand a month more than sad sak here!!!:eek:

    The thing is the job is safe as houses on a contract mainly because there has been a massive amount of money spent on the project and it just has to work. Plus a guy has worked for 20 years in the same place on a contract no less.

    So, whats your thoughts, only just started and dont want to rock the apple cart of course, How should I approach my employers who are a recruitment agency may I add. I know they are still looking for more candidates for the project but cant find suitable players. Should I wait for training to finish do a couple of months than go to the boss with more leverage to secure a juicy contract wage?? or just stick with the perm looking at long term??

    Any one been in a similar position?

    Any adivice would be more than welcome,


    Cheers, Dub.
     
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  2. BosonMichael
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    BosonMichael Yottabyte Poster

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    Shoot, I'd rather stay perm, and I'd lay odds that some of your mates would love to be in your shoes. I don't know how things work in the UK, but as a contract worker in the US, you're not given any sick time, vacation time, or benefits... hence, the extra pay. And it's easy for an employer to not renew a contract if they don't want you around... it's a bit harder to fire a permanent employee.
     
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  3. hbroomhall

    hbroomhall Petabyte Poster Gold Member

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    The usual reason that contractors get paid more is that they *need* the extra to pay for holidays, tax, NI etc.

    I suspect that if you take all that into account they may not be paid much more than you!

    When I stopped contracting and went permie I actually got a better deal!

    Harry.
     
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  4. kevicho

    kevicho Gigabyte Poster

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    The other thing as well is you know have to prove your not an "employee in disguise", which means forms and loads of hassle.

    The other thing that is "inflating" their wages is expenses, you can claim for the first 2 years of a contract, but then if you continue to work there you have to pay them all back.

    Id stick out permanent tbh
     
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  5. craigie

    craigie Terabyte Poster

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    Exactly what the above posters have said.

    You have to take into account that you will be recieving at min 20 days holiday which is one months salary. So knock that off the £1K per month they are getting extra.

    Next, do you get a Pension, if so again, knock that off the extra £1K per month.

    Any other perks, like Bonuses, Sharesave, Expenses, Car Allowance, again knock these off the £1K per month.

    I'm not sure if you have gone in as 1st or 2nd Line. Naturally, someone who is 1st Line will not be getting paid as much as a 2nd Line person, so again this could be a contributing factor.

    Would I rather be perm or temp, perm any day. There was a guy last week in our Dept, had been a Contractor for 6 months, no days off ill (as he could not afford it) and then was told to leave as he was surplus!

    Contractors are normally just people to fill the gap until a better candidate comes along.
     
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  6. BosonMichael
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    BosonMichael Yottabyte Poster

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    Ah yes, forgot taxes... in the US, we have a "self-employment tax" plus the employers portion of Social Security that self-employed (contract) people have to pay.
     
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  7. tripwire45
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    tripwire45 Zettabyte Poster

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    I'm always trying to find ways to turn my contract job into a perm. You may not get as much cold hard cash, but more than likely, you'll get medical insurance, paid holidays, and other bennies.
     
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  8. wizard

    wizard Petabyte Poster

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    As Harry said, they're on more because the company doesn't have to pay NI and income tax the individuals on the contract would.

    So in a way it would be better for you to stay on perm, that way you get all of the benefits that they're basically missing because they're on contract.
     
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  9. derkit

    derkit Gigabyte Poster

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    I feel the same pain as you to be honest - the guys I'm working with are on £175 a day - to get the equivalent take home pay I'd need to get a £42k salary! Yes I get a contributed pension (£3k per year), sick and 25-day holiday benefits but you work out the extra take home pay, I could do the same job and take more home! (This is assuming I don't take 6 weeks off ill as I've broken my leg for example!). Some contracts can be long, we have 3 guys and they've worked for us for 3, 5 and 8 years respectively and there is no real end in sight!!

    I've been floating the idea recently as moving up in my company is not existant, especially with the soon-to-come change in contract we have with the customer, so I've pondered contracting, but it would have to be a serious deal - one I've applied for is £220 a day, doubt I'll get it and with the current economic climate I'm not too sure to take it, even if I got it!

    If you are thinking about it - this calculator site is pretty good and giving you an idea what you may or may not be paid. Contractor Calculator
     
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  10. Fergal1982

    Fergal1982 Petabyte Poster

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    The thing you have to consider, even above everything else mentioned above (and yes, it is possible to make a good bit more money on contracting, even accounting for having to pay NI, and holidays, etc - It may not always be the case, but its possible), is that you are only just in the door.

    You accepted the position you are in just now. If you wanted to contract you should have negotiated it at the time. Consider how the employer may well react to what they will simply see as you getting greedy. They probably wont see it well now, will they? If you start down this path, they may well still take a disliking to your attempts. If you have just started, then you are likely still on probation. So what if they decide to end your employment after probation? Sure it may not be a valid excuse for sacking, but it could be incentive enough for them to scrutinise your work and pick out any flaws they find to build a case. Even if they dont, it could strain relations between you.

    You built this boat, its time to sail in it. That or sink it and start building a new one. Consider contracting for the future.
     
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  11. Sparky
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    Sparky Zettabyte Poster Moderator

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    As it’s a new contract expect some of the contractors to leave when things start to settle down.

    It’s fairly common for new projects to be overstaffed and as the full time staff (you! :biggrin ) get up to speed with the day to day support issues the contractors can help and then its over to you. 8)
     
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  12. Dubfire

    Dubfire Byte Poster

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    Thanks for all your feeback guys.

    Was good to hear a view that was not biased either way seeing as the guys at work are singing the praises of contract and the agency the opposite.

    Spoke to the agency today about whether to change or not and was told that after tax at the end of the year that grand a month extra you recieve on a contract would be taken by the taxman. And the way contracts are worked are being looked at by various agencys with a view to cutting (as of next April) down on people claiming fuel, food costs and subsitance allowances. Which would be a big nail in the coffin for many in the contract field.

    Will look into contracting in the future, though just going to sit tight just now for at least 6 months, probably have to hibernate for the duration on the pitance they pay just now. Get to know the job inside out and apply for a 3rd line position in the next year.

    Hope I didnt come across as gready to the agency. But have to keep telling myself... you gotta look after yourself cause no one else will, in the pursuit of the green....
     
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  13. Qs

    Qs Semi-Honorary Member Gold Member

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    Glad you've reached a decision that you're happy with :)

    The best of luck to you.

    Qs
     
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  14. wizard

    wizard Petabyte Poster

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    If you set your self up as a limited company, you could still claim those expenses, however be careful of IR35.
     
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  15. Dubfire

    Dubfire Byte Poster

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    You are right though been informed that the way expences are claimed through a limited company are also being looked at, the long and short of the info I was given was that every one on a contract will soon be on Pay As You Earn through the agency. This option does not allow you to claim valid business expenses which would help to reduce your tax and NI liabilities.

    Figure that I'm best to look around other fields for employment when im in a job rather that burning bridges at my current employer. The agency have always been looking after their own interests, which is not suprising, just their view on employment either way is always leaning toward making money or saving rather than keeping the employee happy and giving a a-political point of view. Shouldnt really be suprised though, granted.

    Problem is this is my first job from the forces so all this talk of contracts, IR35, Umbrella companies and even down to doing time sheets each week is a very steep learning curve:rolleyes:
     
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