Starting Out - Questions

[Jsecure2]

I am thinking of being a contractor, and I have a few questions:

* When a job is advertised as say, £250 per day - I know agencies take a cut when they get you a job - does this mean you will get something like £220 a day, or will you get the advertised £250, and the company pays the agency higher than this, with them taking a cut? Simplified, if I see a job advertised for £250 per day, will my umbrella company actually receive the full £250?

* How soon before you are out of contract, should you start looking for a new contract?

* As a contractor, what kind of flexibility do you have when you're in a three month contract say, to take a day off, or a morning off, or something like that? Are you the same as an employee, begging your manager to have a morning off etc?

* If you are in a contract that is being renewed on a daily or weekly basis, how much notice do you have to give that you no longer intend to be a part of the contract i.e. you're quitting?

Thanks for any advice you give, I've always been permanent and I'm still trying to get my head around the contracting world

[Denny]

I am thinking of being a contractor, and I have a few questions:

* When a job is advertised as say, £250 per day - I know agencies take a cut when they get you a job - does this mean you will get something like £220 a day, or will you get the advertised £250, and the company pays the agency higher than this, with them taking a cut? Simplified, if I see a job advertised for £250 per day, will my umbrella company actually receive the full £250?

* How soon before you are out of contract, should you start looking for a new contract?

* As a contractor, what kind of flexibility do you have when you're in a three month contract say, to take a day off, or a morning off, or something like that? Are you the same as an employee, begging your manager to have a morning off etc?

* If you are in a contract that is being renewed on a daily or weekly basis, how much notice do you have to give that you no longer intend to be a part of the contract i.e. you're quitting?

Thanks for any advice you give, I've always been permanent and I'm still trying to get my head around the contracting world

You need to get your head round the CUK world too. The general forum is for piss taking and non serious issues and threads about squirrels and school dinners.

If the rate advertised is for X amount, that is the amount you will receive as gross (if you have your own limited co). Otherwise it is the gross figure minus deductions which will be paid to you net (if you go through a brolly - typically 60% or so of the advertised rate, depending on the brolly you're using). The EB ('agency' to the numpties on here) will also charge the client a mark up in addition to the advertised fee you get. This should be about 15-22% average, but it varies. It can be as low as 8-10% or as high as 30%. It is worth finding out what the mark up is, to ensure you are not being ripped off (the EB is widening their mark up at your expense by trying to lower your rate after the job is offered). That client billed total figure (mark up + your fee) won't appear on any of your own paperwork.

For the rest of your queries, it is up to the EB client and yourself to negotiate before the job starts and once you are on site. The terms through an EB is on the contract you sign with them are pretty much laid out for you but can be negotiated with you, within reason, provided the client agrees to the changes. The EB will do this side of the negotiation as they are technically speaking 'supplying you' (or your company) to the client (don't get me started on that one).

You start looking for a new contract either after the job you're currently on has been terminated, or else you start looking when you know you will be terminated. It is wise to ask the client, in advance of your contract termination date if you are going to be renewed in case you are not going to be. Ask about 4 weeks before the date of termination. Sometimes the client will take a while to decide though, but still look anyway and keep applying and attending interviews.

If you decide to form your own limited company, then you are strongly advised to get the EB terms you will sign checked out by a contractor reviewer (Qdos, Bauer and Cottrell, Lawspeed) to ensure that it is outside ir35, if you intend to operate your business that way. Look at the HMRC website on ir35 to give you an indication of what they see as operating as a business on your own account. Otherwise, you might be wiser to go brolly in the first instance if you think your jobs are likely to be bog standard bum on seat temp jobs requiring a strict weekday presence with routine working hours and location stipulated and with a fair amount of direction of control over how, what and when you do the work and with no rights of substitution (in other words it feels like a permie job). The rules on ir35 are actually quite complex than I have explained, but as you are a newbie I would concentrate on getting your first contract under your belt before getting too worked up about the finer details and case law on this complex and frustrating piece of legislation.