Determining Agency Cut

[aikidoka]

Hi,

I hope this is the right area to post this, I'm new

To explain my situation: I'm currently a permie, generally looking for permie work. An agent picked up my CV from an online job search and contacted me on a whim, as I have some very specific skills requested in the contract.

The initial rate offered when the agent put my CV across was very inviting and enough to make me consider finally making the jump to contracting (thought about it many times, but the situation was never right).

Since then I've had two phone calls from the agency, each time telling me that the rate is lower. I know for a fact that the agent is taking advantage of me being a newbie to increase their cut.

Despite this, I am still considering going to the interview (what harm is there? Any interview practice is good practice...) But I'm curious, is it considered bad form to ask how much the agency is charging the client? I know that if I ask the agent, they're bound to lie, and the client is more likely to tell the truth.

Any opinions are gladly received.

[KathyWoolfe]

I don't think that they'll tell you as it's really none of your business.

At the end of the day it doesn't matter what the agent is getting - only what you are getting.
Personally as long as what I get is enough (is it ever?) that's all I care about

[BrowneIssue]

As you already know, the agent is taking the Mickey. They always try these sorts of stunts. That rate will continue to go down right up to and beyond you starting the contract. It is up to you when to stop it going down.

Interview practice is indeed good practice. You 'behave' differently in a contractor interview compared to a permanent interview so the practice is good.

Virtually all contractors get shafted on their first contract. Margins up to 50% are not unheard of. However, I now understand more about why - a lot of people walk out of their first contract. The risk to the agency is greater with a first timer. You correct this at the first contract extension by asking for a fairly large rate increase.

You are perfectly entitled to ask the agent what their margin is. They are perfectly entitled to feign offence, refuse or lie. If they say "15%" what have you learned in reality? And what will you do if they say "50%"? Some of us have made the personal decision that it is best not to know!

[oracleslave]

Probably not helpful in practise but if you read this I think it implies they have a duty to disclose all their fees etc.

http://www.opsi.gov.uk/si/si2003/20033319.htm#13

[ChimpMaster]

I wouldn't waste anyone's time unless you would be will to accept the contract on the terms put forward when you attend the interview. If you know that they agency is pulling the rate then tell that that it's not worth your while unless you get £x amount - whatever you're happy with.

Yes there's a risk to the agency as you're a new contractor, but there's also a risk for you as you might not like the contracting game, or the contract could be pulled and you could be out of work before you know it.

Forget the agency cut - they all try it on and as a business they need to maximise their return. As a business you also need to do the same - so just state the rate that you want and that you're happy with. If you have niche skills, it's likely that they can't find many good consultants so you may have the upper hand.

Negotiate.

[lukemg]

You already have a job and therefore a position of strength. Go for the interview, if you get the job, tell the agent you want the original rate specified.
Try to get contact details from the client, email address etc.
Dig your heels in hard and say you aren't prepared to jump unless they match the original rate. They play this game every day but they will cave in if you stick to your guns. DONT agree to review after 3 months - they will deny knowledge.
If they say sorry no can do, contact the client say you are really sorry the contract has been withdrawn as you really wanted the role. Say you have some concerns about the agent as they kept changing the rate being offered. Client will know nothing about this and savage the agent.
Personally I cannot just forget about what the agency gets, it is important to me.

[KathyWoolfe]

You already have a job and therefore a position of strength. Go for the interview, if you get the job, tell the agent you want the original rate specified.
Try to get contact details from the client, email address etc.
Dig your heels in hard and say you aren't prepared to jump unless they match the original rate. They play this game every day but they will cave in if you stick to your guns. DONT agree to review after 3 months - they will deny knowledge.
If they say sorry no can do, contact the client say you are really sorry the contract has been withdrawn as you really wanted the role. Say you have some concerns about the agent as they kept changing the rate being offered. Client will know nothing about this and savage the agent.
Personally I cannot just forget about what the agency gets, it is important to me.

Thanks Luke, I'll try this at my next contract negotiation.

[aikidoka]

Thanks for the tips.

I agree that there is a high level of risk on both sides, particularly when there is the possibility that the contract would not be extended after the initial period, and that I might be out of contract.

Yes, it is probably better not to know - I imagine it is sickening to learn that they're earning nearly as much as you a day for doing absolutely nothing.

The Agency has yet to get back to me with the details of the interview, so I know I'm going to have to push him for those, so I'm thinking of responding to his email dictating the newer, lower rate reminding him about the information he is yet to give me, and that I would not be willing to accept any lower than the original amount offered.

Thanks for the advice

[Ardesco]

Personally I cannot just forget about what the agency gets, it is important to me.

Some things in life you have no control over (deluding yourself into beliving that you are in control doesn't count) so why get high blood pressure and stress and invite interesting medical problems like diabeties, high blood pressure, coronary heart disease, etc into your life?

Just chill out, work for a rate you are happy with and go with the flow.

[TheFaQQer]

Some things in life you have no control over (deluding yourself into beliving that you are in control doesn't count) so why get high blood pressure and stress and invite interesting medical problems like diabeties, high blood pressure, coronary heart disease, etc into your life?

Just chill out, work for a rate you are happy with and go with the flow.

We've been round this discussion a few times here - if you're on a good enough rate then people tend to ignore the agency cut; if not then it's important.

My current agent told me her cut when I applied for the role, I was too expensive, so I cut my rate a bit and she cut her commission a bit - everyone's happy (since I still get a fair bit more than I'd told myself I'd settle for).

I don't care what the rates are for agencies, but then I earn a decent wedge.