Hit 400 staff?
After my last experience with VM, I'm not convinced they have 400 tech staff to affect.
Virgin contractors grip up for more cuts
Virgin Media contractors earning more than £300 a day have been told to accept a 15 per cent cut in rates or leave the company. Virgin lopped ten per cent off day rates last year - when such a policy was widespread and usually spun as a way to avoid job cuts. But with the first signs of economic improvement many contractors felt …
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Fairness
Agencies, once a contractor has been on site for 6 month, should not be taking over 30% - more like 5 % to cover admin. I hope Virgin are putting pressure on them as agency contracts between agencies and contractors will stop the contractors moving to other more competitive agencies.
It would be interesting if all 400 contractors acted in unison and did not renew.
They may not have any say in that-
there's a new Beancounter in town, and he's not renewing any.
Which just means....
.. that the quality of support will drop even lower than it is already, if that's imaginable.
VM support is now so bad, you'd have to get up seriously early and practice to do worse.
Nice saving
That's a saving of £5M per year. Contractors are overpaid anyway and should be replaced with permanent staff
Fair enough
Overpaid ? You try and get 400 staff to reduce pay or indeed get rid of them at 30 days notice with no consultation, union threats or bad press.
You drive home in your Toyota Corolla and the Consultant will go home in his BMW 5 Series. Yes, the BMW is indeed more expensive - but you know what, you get what you pay for - Quality, Performance and Innovation.
Seriously?!?
So you only get good people if you pay twice the equivalent permanent salary? Utter crap!
I would say that 90% of the contractors I interact with at VM are in NO WAY worth twice the rate of the permanent employees that work just as hard as the contractors.In fact, in a large portion of cases because they aren't VM employees they don't know what the culture is or who the real experts are and therefore waste time.
I think you misunderstand the point of contractors. They are SHORT term, flexible staff. That's why they are paid a higher rate because they can be "fired" at a moments notice because the work is complete.
If you want stability, take the "pay cut" and go permanent otherwise STFU
Overpaid
Yes its a mixed bag some consultants are way over paid (not all just some).
Example: I was a consultant and proposed a a general clean up of (complicated here) of the computer systems "library" (where it keeps tracks of all files). Over the years the library had become full of obsolete files, some over 10 years old and were never going to be needed again.
Management : Well we have to hire a consultant to come in ($10K (us) per day) and check out your recommendations. Fine $20K later and a short report from him saying that what he is proposing is a great idea and he should continue. So I get the go ahead and finally get the work done over a 2 month period as it had to be done in small increments(another side issue deleted).
Me: I was getting paid less than us 25 dollars an hour average for people was about that fo he got paid more than $18K (US) for something I did for less than $400 (us).
BTW the payback was in the order of 100's of thousands of dollars(US).
When is a "contract" not a "Contract"...
... when it's with a small, independent IT contractor!
I am sure that if I unilaterally decided to "renegotiate" my cable TV contract with Virgin they would be the first to send the lawyers in.
So between HMRC having a 2-tier definition of "company" i.e. "good Companies like investment banks that f*ck over the entire economy" and "bad companies like independent IT contractors who must be rogered by IR35 etc despite trying to be innovative and grow and contribute to the economy" and large corporations having a 2-tier definition of "contract" it's enough to make you weap...
Come to Germany.
Despite this country's reputation as a bureaucratic hellhole (one of my favourite jokes is that Germany's number 1 export is red tape), actually working as a contractor here is dead simple - as long as you don't fall into the trap of using an umbrella company. You will get yourself into a big, big tax mess if you do (take this from someone who has learned this lesson the hard way.) A much better idea is to bite the bullet, find an English-speaking tax adviser and talk to them about Freiberufler status. Listen to them, and you will be laughing all the way to the bank.
Operating as a freelancer here is fairly simple to set up, does not require the formation of a company, and can be done by filling in a form at your local Finanzamt (or your friendly German tax advisor) - and what you get is the ability to invoice any commercial entity directly, in your own name, and you can charge them 19% in VAT (or Mehrwertsteuer, as it's known here) - which, of course, you have to surrender to the Finanzamt - but you can claim VAT from any business-related expense, just as you can as if you were a UK VAT-registered limited company.
The best thing? We don't have IR35 here. You also don't have to pay social security, as a Freiberufler - and here in Germany, that means the difference between taking home 65-70% of your income, versus taking home only 50%. As if that were not enough, rates are higher here - much higher than in the UK - but on the flip side, if you want to work here, good IT skills had better not be the only thing you're able to offer: Many clients here take excellent IT skills as a given, and in addition, demand that you speak their native language to a good standard. Better call Berlitz...
you are perfectly free
to renegotiate your cable tv contract with Virgin at the end of your term. Just as they are perfectly free to decline your offer and terminate your service.
The contractors were not forced to take a pay cut, they could have declined the renewal at the new rate, and gone somewhere else, if they could find somewhere else. That uncertainty is a part of contracting, and why they get paid more.
2009 just called and they want their rate cuts back
are they fucking serious?
has no one told VM the job market is well into a spring thaw? and rates are back up again?
I hear the sound of 400 contractors suddenly logging onto jobserve
dunno where you're located
but in the midlands its looking worse for employment - no one round here will stick out for over the top money - those people are overpaid and if they wont work for a sensible rate theres plenty as will
Not a good strategy
You could get away with this tactic this time last year, not now. My guess is that even the contractors who pretend to renew will be out the door as soon as they can.
As for contractors being overpaid, what year are you living in? These days I'd say the contractors get a very raw deal.
Lol.
As a contractor in the process of leaving this far-from-competitive economy all i can say to this is "Bye then!".
And to Mr Anonymous @Nice Saving.... you are just jealous, it takes skills and confidence and risk management to be a contractor and constantly be a short step from unemployed. It keeps our game up, skills up and employability up (often money too). Can you say the same?
LOL
Jealous? Moi? LOL
Jealous of the constant worry that in this economic climate I could have my pay slashed by 15% and do sod all about it except bitch on a forum and threaten to walk out?
Jealous of the constant worry that my skills are out of date and have to retrain all the time?
Jealous that the permanent employees see me as a drain on the company?
Jealous that if I was sick I wouldn't earn any money?
Jealous that I get no paid holidays?
(And yes I know that those last two are mitigated by a larger "salary")
No, my friend, I am not jealous at all. I've seen many contractors constantly worrying every 6 months that they won't get another job, or in pay disputes with the company, or being forced to take jobs far away from family because that's all that's available for "what they are worth"
I prefer the work/life balance that VM gives me.
There are too many contractors
with a permie attitude. They treat their company's income as though it were a regular salary and then can't survive when there's a downturn and they find themselves out of work because they don't put anything aside for the rough patches. Any contractor who accepts being told that their work is now worth 15% less doesn't deserve anyone's respect or sympathy because they aren't really contractors at all.
If you're a VM contractor and you don't tell VM to stick their rate cut where the sun don't shine then I suggest you dispense with the embarrassing charade and look for a permie job.
Sir
Thus speaks a true contractor :D
I must admit when I first started out and wasn't that sure of myself in a new contracting world I did exactly what you described above and lived hand to mouth, and paid the price when I lost my contract unexpectedly.
I'm now taking a bit of down time with enough in the bank to see me through for 9 months and not worried about another contract for at least another month.
I couldn't even really tell you what changed between those two different people, except perhaps a recognition that when I'm surrounded by permie drones* who couldn't organise a fart in a tea-cup that my skills are actually worth quite a bit to this company I'm doing this work for. It makes you stick up for yourself and not self yourself short, even in a recession. In fact, even more so in a recession.
*The fact that you are reading this on El Reg probably means you, personally, aren't one of these people, but you must know them within your own organisation.
My last contract had a nice girlie heading up the firewall team and she was wasted there. I rate myself, but I know when I'm beat. This girl could go contracting and double her salary and half her work-load in a heartbeat and I told her so. Too scared and requires the security, which is totally fair enough, so don't think I'm just dissin' permies. What I am saying is that you might have the skills, but you have to know you have the skills to get on in the contract world.
And for anyone out there pissing on contractors' fireworks, popping our balloons and de-jamming our doughnuts, guess what? We get that *all* the time. I have never felt the need to defend myself. I can just smile and imagine how frustrating it must be for you :P
I feel like some uppers and downers, who will win? :)
More than one reason to go contracting
I'm one of your "permie attitude" contractors. I have been contracting in UNIX sysadmin and project work for 10+ years since leaving a (good) permanent role, and during this time have had three 'droughts' where I have been out of contract for more than two months (the worst being a five month gap in 2002 after the reaction to 9-11).
I originally went contracting because a permanent job could not keep my family (admittedly large - 4 kids) in a reasonable standard of life. I entered with debts than needed to be paid off, which I managed, but annoyed the IR leading to a significant fine (it's too easy to get it wrong, even with an accountant) and then hit the 5 month drought. This wiped out all of my savings, and when I grabbed at a contract, it was at a *30%* drop.
Over the next 5 years, I managed to get my rate back to where it had been *WHEN I HAD STARTED CONTRACTING*, to the point where I could start saving again, when I had another gap due to inept management raising a contract (I wanted the contract, I had convinced them they wanted me, but it just took an age getting the paper work raised). Back to square one on the savings.
OK for nearly another two contracts, nearly two years (no rate change), then another gap due to the gathering recession (and more ineptitude regarding raising contracts). I took an 11 percent cut, which is where I am today (fortunately a long-term contract). Even here, and having already taken a cut, I was asked to consider another rate cut, but fortunately it didn't happen because the project was too important to loose any of the contractors.
So here I am again, on a lower rate than 13 years ago (and with a higher tax burden - damn Gordon). How many permanent employee's working in essentially the same job for 13 years, can say that they earn less than they used to! This is because contract rates for even good people have been on a roller-coaster for the last 10 years.
I enjoy my work, I like my current contract, but I am essentially living nearly hand-to-mouth until I can clear the debts again, and start building my savings. And in the meantime, living costs more, travel costs *MUCH* more (important to a contractor who may have to travel to keep working - you don't move for a contract that may only last 6 months).
It's really not as lucrative as some people think. Employers as well as employees NI, full whack of tax (if you are not avoiding IR35), pension, holiday and sick pay to consider, longer traveling time, accommodation costs, accountancy or umbrella company costs . Add to this family disruption, and it is no wonder so many contractors I know either stay single, burn out, or end up in disrupted families (divorce appears to be a higher risk). And to cap it all, I am expected to work a longer week (a 'professional working week' of 40 hours) rather than the 37 or 37.5 that is the norm.
The main advantage for me is that my wife has not had to work, and can stay at home as a 'traditional' housewife, which is what she wanted. But as I keep saying to colleagues, we probably have less household income than a family where both partners have moderately good jobs.
Permies cheaper?
HA!
Seriously, next time you permies pass the HR department, ask them how much cheaper Permies are for your company... with your compassionate leave, your personal development plans, sick pay, paternity/maternity leave, pensions, bonus schemes, training, holidays, health care... sure... you're all way cheaper.
Paris because... we'll better to look at a pretty face while getting fsck'ed.
Overpaid?
Permies who whine about contractors being "overpaid" make me laugh. If you think we're overpaid when why aren't you doing it then? Put your money where your mouth is or STFU.
depends
Depends on the contractor - I've seen contractors who's only genuine skill seems to be a PHD in bullshit manage to flimflam clueless managers out of six figures... I would argue they were overpaid since once they'd fucked off it was left to the permies to go in and fix the bloody mess afterwards.
Doesn't matter whether you're a permie or a contractor it's all about attitude - you can find work-shy, bone idle permies just as easily as BS/rip-off merchant contractors... yup folks, there are twats in every walk of life.
Just got a new contract in Germany...
...and the agent mentioned something that piqued my interest:
The client would be paying me directly, and the agency would receive their "cut" separately. The agency, as you might imagine, weren't too pleased about this (and I can imagine why: When an agency receives all the money, they have total control over what the contractor gets.
I was, of course, thrilled to hear this: What's in the agent's interest isn't necessarily in mine - and if my client is taking steps to ensure that the overheads involved in taking me on are as low as possible, that in turn translates to less risk that my contract will be terminated.
Cuts don't always work out for the customer: I once worked for a Dutch bank who said "Right, everyone gets a 15% pay cut" - and that would have been pretty straightforward, except for the fact that most of their contractors were going through 3-4 middlemen (thanks to their policy of only working with "preferred suppliers") - and the middlemen decided they simply weren't going to cut THEIR rates (they didn't have to, after all) - so they just passed the cuts on, down the line. By the time it hit the poor bastard at the end of the line, they were looking at an average 45% pay cut. As you can imagine, all the contractors vehemently told the bank to bugger off - and the bank, astonished, actually sat back and did a little thinking. They would, otherwise, have faced the prospect of every contractor leaving - right in the middle of a critical migration project that would have cost them billions in delays.
I have high hopes about the new contract: It is about time that customers took back control over the margins that agencies collect, and I hope that more clients start putting their foot down and saying to agencies "You can find us the staff, but you will no longer own the revenue stream."
All this arguing makes me laugh
I've been on both sides of the fence. Contracted for 10 years (5 years either side of Y2K) and am now in a permie job. I can safely say that contractors have no higher level of general expertise than permies, and do not deserve to be paid as such. In fact, around Y2K there were a lot of contractors I knew earning upwards of £50/hr, who were absolutely shit. There are exceptions on both sides, but there's no generalisation here. The only reason contractors accrue higher rates is that they're dispensable, and can be hired and fired at the employer's will.
For those contractors complaining about the rate cut, the whole point of being a contractor is that you're a service company. If a firm was paying for electricity, and decided to re-negotiate to reduce costs, the supplier would have the right to walk out and be replaced. You're the same. If you don't like it, leave and go elsewhere for business. If you're an expert, you'll be hired, if not you'll realise it's harder out in the real world than you might expect.
If you feel a bit miffed and think you have some sort of rights about staying on and not having your rate cut, then I would suggest that you're a disguised employee and IR35 applies. When I contracted there was a zero-notice clause for the firm who hired me, so they could cancel or renegotiate my contract at any time - and that was exactly why I was paid such a high rate relative to permies (who typically have to be paid redundancy or at least 2-3 months' salary when they're laid off).
Ironically, I'm now earning significantly more (around 200%) as a permie than when I was last contracting, and I have 6 weeks' holiday, sick pay, a pension, access to the office gym, life cover, travel season ticket loan and many other benefits to boot, as well as no accounting or other annoying paperwork. Oh, and I get an annual bonus and some career prospects too. I know where I'd rather be.
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