Contractors' Questions: When do I ask for a rate rise?

Contractor's Question: As money seems tighter with my client, even though they are not a big victim of the credit crunch, when is the best time to push for a rate rise? Is there a time, or an obvious stage, when it's more favourable to negotiate for more, even though I'll be providing much of the same?

Expert's Answer: When it comes to requesting a rate rise, contractors may find it helpful to know that sometimes a balance needs to be struck on the part of the agent. One thing that will help a contractor get a reasonably high level of remuneration, and retain work, is how they act while they work for a recruiter's client. It comes down to the contractor's overall professionalism.

The key is to gain lots of proprietary knowledge, become invaluable and then push for the rise. But the balance for an agent is that they may have 'sold' the contractor to the client, having said, in a type of testimonial, that the contractor does not have a history of demanding more money as soon as they gain proprietary knowledge and become critical to the client's IT work.

Totally disregarding this could be very detrimental to career contractors, who want to keep in the good books of a select number of agents by taking care of their reputations as one-person businesses.

We try to renegotiate IT contracts six weeks in advance, though this is mainly in our interests as a recruiter.

We will tell the client company that six weeks before the contract end-date, the worker will not be receiving a huge amount of calls and offers from other agents. There is therefore a good chance the client can secure the contractor for a (an inflated but) reasonable rate. Given there's six weeks to go before the end-date, the contractor will probably agree, sometimes to avoid a round of sudden interviews. However, if the client were to leave it later than six weeks, there is a chance they will lose out. Six weeks is the ideal for us, as an agent, but not necessarily for a contractor seeking a massive pay rise, as the client still has six more weeks to decide whether or not to agree, or look for a replacement.

As told to CUK by Matt Smith, a director at Harvey Nash, an IT services and recruitment company .