Email from agency 'requesting' a 10% rate reduction

[miffed]

Just received this email from my agency. The names have been changed (some more than others) for the sake of anonymity.

Dear Phil

The client for your current engagement, Bobco Limited, operates in a highly competitive market and must prudently manage its cost base at all times. The current economic climate means that the market rates for contract resources has dropped due to the reduced demand for contractors. Bobco Limited has a strategy to continue to use external resource and wants to ensure that this strategy remains realistic in the present climate to maintain the long term profitability of their client engagements.

Bobco Limited have instructed Enal Computing to seek your assistance in achieving their business objective and request a reduction in your daily / hourly rate of 10% to that which reflects current market conditions. The revised rate will come into effect on Monday 14th December.

Bobco Limited and Enal will consider positively the flexibility you will demonstrate through accepting this change, in conjunction with the business requirements for the role at the time of your next contract renewal. Please be advised that Bobco Limited will not entertain any discussions around changes to other terms and conditions of your contract.

In order that the appropriate documentation can be issued, we seek your agreement to your rate reduction by emailing [email protected], no later than Friday 13th November. The Enal Rate Reduction Team is available for you to discuss the above in more detail and to arrange for the signing of your new terms and conditions that are required to be in order prior to the commencement of the rate reduction period.

Please direct all enquiries to the Enal Rate Reduction Team and NOT to any member of the Bobco Limited community.


Yours sincerely,

Enal Rate Reduction Team

It's the last line about not contacting the client that really annoys me. I realise that there's not much I can do apart from roll over and take this - I like the client and I've been with them for a long time - but I'd be interested to know if this is a common occurrence.

I'm tempted to reply and ask if the agency are going to reduce their commission too but I think I already know the answer to that.

[RichardCranium]

Tell ClientCo "My agency are terminating me because I'm not making enough money for them. They reckon they can get someone else doing the same gig for you but pay them 10% less."

Assuming you have an 18 month warchest, of course.

[Jeebo72]

Why don't you just say no and leave. When they come crawling back, ask for a 10% increase...

[Zippy]

I'd be tempted to casually mention the "cost reduction plan" to the client - the bit about not contacting the client (it is generally in the contract that you don't discuss rates with them) is fishy.

[Sysman]

Just received this email from my agency. The names have been changed (some more than others) for the sake of anonymity.

It's the last line about not contacting the client that really annoys me. I realise that there's not much I can do apart from roll over and take this - I like the client and I've been with them for a long time - but I'd be interested to know if this is a common occurrence.

That last line would have me mentioning it "casually" to the client. It smells of an agency stitch up to me.

After similar negotiations half a dozen years ago, the client was genuinely surprised how little of the dosh he was laying out reached us.

[SorenLorensen]

I'd be tempted to casually mention the "cost reduction plan" to the client - the bit about not contacting the client (it is generally in the contract that you don't discuss rates with them) is fishy.

WSS. I'd absolutely mention it to the client, why not?

[centurian]

Agreed that last part is fishy. I am sure there are ways of working out what is going on without actually "directing an enquiry".

The message is carefully worded because they haven't said what will happen if you say "no". The implication is that you will have your contract terminated, but they haven't said that.

I wouldn't rule out this being a bluff. All depends how much ClientCo want to keep you.

[Paddy]

Just received this email from my agency. The names have been changed (some more than others) for the sake of anonymity.

It's the last line about not contacting the client that really annoys me. I realise that there's not much I can do apart from roll over and take this - I like the client and I've been with them for a long time - but I'd be interested to know if this is a common occurrence.

I'm tempted to reply and ask if the agency are going to reduce their commission too but I think I already know the answer to that.

It only says "Please direct all enquiries to the Enal Rate Reduction Team and NOT to any member of the Bobco Limited community." and not " You must not..."

You know your client; then talk it over with them.

[pzz76077]

Your agent are simply trying it on. Ask them the provide written evidence.

There is no absolutely reason why you cant contact end co to verify this story or not as I suspect will be the case.

PZZ

[PRC1964]

Are you the only contractor there? They make no mention of not discussing it with other contractors and it might be interesting to see if they all got the same email.