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Old 09.10.2013, 20:55
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IT contracting agencies/umbrella companies

Hello everyone,

I'm considering an IT contracting role for a big bank and the agency is telling me that I would get net 50% of the daily rate paid by the client.

Can this be considered a normal "cut"? is there any room for negotiation?

I would appreciate input from an experienced contractor in the Swiss market.

thanks in advance!
m.
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  #2  
Old 09.10.2013, 20:57
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Re: IT contracting agencies/umbrella companies

If you're happy with what you're offered, does it matter? 50% cut is very high for a contract through an agency, fairly normal for a a contract through a consultancy.

There is an always room for negotiation.
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Old 09.10.2013, 21:00
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Re: IT contracting agencies/umbrella companies

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Hello everyone,

I'm considering an IT contracting role for a big bank and the agency is telling me that I would get net 50% of the daily rate paid by the client.

Can this be considered a normal "cut"? is there any room for negotiation?

I would appreciate input from an experienced contractor in the Swiss market.

thanks in advance!
m.
well pension & social costs of employer / employee will be over 30% has any tax been deducted to get to 50%. Net of tax pensions etc, the agency is not getting a huge cut.
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Old 09.10.2013, 21:08
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Re: IT contracting agencies/umbrella companies

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Hello everyone,

I'm considering an IT contracting role for a big bank and the agency is telling me that I would get net 50% of the daily rate paid by the client.

Can this be considered a normal "cut"? is there any room for negotiation?

I would appreciate input from an experienced contractor in the Swiss market.

thanks in advance!
m.
Rates vary per agency and location. Some agencies have preferred vendor agreements with companies that mean they will always be paid a particular amount, regardless of the contractor's rate. Others (usually small agencies) negotiate their rate on a per role basis with the company.

As to whether the agency will negotiate with you and decrease their take to increase yours, it depends on a lot of variables like the above, whether you have any bargaining leverage, whether you have existing relationships in the company you'd be working within, and whether you're easily disposed of for the company you'd be working within.

50% is very high, although not untypical in big global agencies. Some agencies will discuss their cut, but many will not disclose it.
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Old 09.10.2013, 21:15
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Re: IT contracting agencies/umbrella companies

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50% is very high, although not untypical in big global agencies. Some agencies will discuss their cut, but many will not disclose it.
As FMF highlights, this is 50% net. The question is, does the OP mean 50% after social etc. deductions?
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Old 09.10.2013, 21:25
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Re: IT contracting agencies/umbrella companies

Yes, I thought that net means the same as "after all deductions".

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As FMF highlights, this is 50% net. The question is, does the OP mean 50% after social etc. deductions?
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Old 09.10.2013, 21:52
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Re: IT contracting agencies/umbrella companies

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Yes, I thought that net means the same as "after all deductions".
well 50% net of all deductions sounds like a bargain, as we don't know what your salary is we can't actually do a calculation

You were talking about the agency getting a 50% cut, I doubt they are getting more than 5%
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Old 09.10.2013, 22:48
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Re: IT contracting agencies/umbrella companies

Infosys and cognizant take a large chunk due to the effort involved in getting a visa, and supporting workers from India.
50% would not surprise me.
--
EU based agencies are between 3% and 15% depending on the economic climate.
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Old 09.10.2013, 23:06
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Re: IT contracting agencies/umbrella companies

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Infosys and cognizant take a large chunk due to the effort involved in getting a visa, and supporting workers from India.
50% would not surprise me.
--
EU based agencies are between 3% and 15% depending on the economic climate.
Incorrect about EU agencies. Many take more than that. I know a small one that takes 30% without negotiation for eg.
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Old 09.10.2013, 23:44
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Re: IT contracting agencies/umbrella companies

30% is way over the going rate.
I don't think they can compete long term with that rate.
Was it a 1-off contract?
Something very special??
Or an agency behind another agency behind another agency chain?
--
I once had "an agency" (1person) who was trying to pawn me to another agency and taking a cut!! (In holland)..
Apparently parasites are "normal" in holland.
I declined the offer.
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Old 30.10.2013, 20:48
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Re: IT contracting agencies/umbrella companies

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50% cut is very high for a contract through an agency, fairly normal for a a contract through a consultancy.
what is the difference between a contract through an agency and a contract through a consultancy?
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Old 29.01.2014, 08:45
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Re: IT contracting agencies/umbrella companies

about CHF1m a year
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