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Old 11.06.2020, 16:18
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Day rate for contractor

I have received an offer for CHF 850, all inclusive in Zurich. I'm not familiar with day rates in Switzerland and haven't negotiated the offer yet. Is that reasonable for a data analyst/possibly server management role or am I underselling myself?
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Old 11.06.2020, 16:38
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Re: Day rate for contractor

It's not great.
If you use the search function for contracting or freelance/freelancing you'l find plenty of information.


Points to consider are you'll probably remain tax resident in the UK if you retain any links (house, kids etc) until you've done a full tax year outide the UK, so that will be until April 5th 2022.
Also as mentioned here, you are liable for all the empoyer costs (usually) such as the insurances. This adds up to about 10%. Then you have all your employee costs.


You can ask them for a salary projection. They'll say they cannot do it because you don't have a Swiss address, so tell them you'll live in the kanton of Zurich and base it on that. If they won't give you a projection then don't deal with them.
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Old 11.06.2020, 17:44
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Re: Day rate for contractor

Thanks, that's helpful.



The contract is for one year with a 1 month notice period. You mentioned in the other thread that these contracts have popped up because of travel restrictions and companies can't outsource to India. In this case they are hiring an entire team of contractors. Do you think it is likely that they will all be let go once travel restrictions have been lifted?
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Old 11.06.2020, 17:46
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Re: Day rate for contractor

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In this case they are hiring an entire team of contractors. Do you think it is likely that they will all be let go once travel restrictions have been lifted?
I would think so
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Old 11.06.2020, 17:51
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Re: Day rate for contractor

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I would think so
I would think not, just for balance. You might not get an extension, but onboarding, permits, knowledge transfer, team cohesion all take a bit to get started. the cost-benefit for dropping you after 3 months and moving direct to india prob isnt worth it and anyway, from a financial pespective the opex will have now been approved for the contract term most likely.

Come out here for a year. I did in 2007, and we're still here :-)
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Old 11.06.2020, 18:15
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Re: Day rate for contractor

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I would think not, just for balance. You might not get an extension, but onboarding, permits, knowledge transfer, team cohesion all take a bit to get started. the cost-benefit for dropping you after 3 months and moving direct to india prob isnt worth it and anyway, from a financial pespective the opex will have now been approved for the contract term most likely.

Come out here for a year. I did in 2007, and we're still here :-)
I came out in 1985 for a year or two, and I’m still here.

Back on topic. I think 850 is too low. I’d start by suggesting a higher amount pointing out the high rents, expensive health insurance, not having sick or vacation days. Many people leap at the first offer, but on the other hand, most offers are not what they are prepared to pay, only what they hope they can pay.
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Old 12.06.2020, 10:34
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Re: Day rate for contractor

In these times 850/day (8 to 8.4 hours/day) is a good offer, I would take it.

Some get 550 or even lower.
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Old 15.06.2020, 13:46
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Re: Day rate for contractor

Thanks for your replies. They are flexible on the rates, but wouldn't tell me how much they deduct in agency fees. Surely that's something that will be revealed later if I proceed to the next interview round?
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Old 15.06.2020, 13:54
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Re: Day rate for contractor

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Thanks for your replies. They are flexible on the rates, but wouldn't tell me how much they deduct in agency fees. Surely that's something that will be revealed later if I proceed to the next interview round?
Yes, the Agency will deduct some handling fees for payroll etc. as well as deductions for Social Sucurity, Pension, Sick Pay and Holidays.

These last two didn't used to be required, but these days they're obliged to treat everyone as an employee, with paid sick and holiday entitlement, so they simply make you pay them the required amount - make sure you use up all your holiday and sick day entitlement at the end of each year, as they're not good at returning unused contributions to you.
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Old 15.06.2020, 15:09
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Re: Day rate for contractor

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Thanks for your replies. They are flexible on the rates, but wouldn't tell me how much they deduct in agency fees. Surely that's something that will be revealed later if I proceed to the next interview round?
I interpret this as they will pay you more than the CHF850 per day, but they will not reveal how much they are being paid by the customer?


ie, they may be getting chf1200 per day, taking chf350, and your rate is the chf850. The chf350 is their payroll costs and profit. By payroll costs I mean that they employ people to run the payroll and usually pay you before the invoice to the customer is paid to them.



However still you need to find out if then they also take the employer costs out of that 850.

Do the interview, it's always good practice anyway.
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Old 15.06.2020, 15:33
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Re: Day rate for contractor

IMHO, the CHF850 per day rate is bloody good. Take 21.7 days on average in the month multiply it by 12 (or 13th check) which gives you whopping more than CHF220k per annum. Even if you pay private pension (retirement annuity or 3rd Pillar), add tax deductions and etc. For someone looking into relocating to Switzerland, and paying lower taxes despite expensive rent, it’s also great where good salaries already start +100k per annum.

Besides that, it might be a good starting point for something better coming your way in the future here.

Last edited by jacek; 15.06.2020 at 15:43.
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Old 15.06.2020, 16:31
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Re: Day rate for contractor

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IMHO, the CHF850 per day rate is bloody good. Take 21.7 days on average in the month multiply it by 12 (or 13th check) which gives you whopping more than CHF220k per annum. Even if you pay private pension (retirement annuity or 3rd Pillar), add tax deductions and etc. For someone looking into relocating to Switzerland, and paying lower taxes despite expensive rent, it’s also great where good salaries already start +100k per annum.

Besides that, it might be a good starting point for something better coming your way in the future here.
Will he not have a day off all year? Is 220 days per annum, not a better number? By the time you’ve taken into account paying all the social security and pension contributions, I’d say it’s more like CHF 150k.
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Old 15.06.2020, 17:17
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Re: Day rate for contractor

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Will he not have a day off all year? Is 220 days per annum, not a better number? By the time you’ve taken into account paying all the social security and pension contributions, I’d say it’s more like CHF 150k.
Yes, that's a better comparison. Deductions will be made assuming 4 weeks holiday and a set number of sick days, such that he'd still be paid for those days not working and will effectively lose that money if he doesn't take the time off, i.e. if he works on days he could be taking off he won't be paid any more or less.

When I was contracting (in CH, as well as the UK) it was all a bit different, we could take as much or little time off as we liked in the knowledge that we'd only be paid for the days we worked. Or hours, really, since the contract rate and maximum working time was always defined in hours, not days. Here in CH we were set a maximum of 2000 hours per year, which is around 250 days, and yes, sometimes I managed to get the full amount in, even after taking holidays. 10 hour days were not unusual, when you were being paid by the hour.
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Old 15.06.2020, 17:47
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Re: Day rate for contractor

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Will he not have a day off all year? Is 220 days per annum, not a better number? By the time you’ve taken into account paying all the social security and pension contributions, I’d say it’s more like CHF 150k.
I took into account a week consisting of 5 working days with free weekends Of course. That’s what for instance RAV uses in calculation with 21.7 days in a month on average. Uncontrolled period Tagesgeld or holidays are paid as 5 days of holidays per every 60 work days. I assumed that you get at least four weeks of paid holidays as a norm.
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Old 15.06.2020, 18:19
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Re: Day rate for contractor

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I took into account a week consisting of 5 working days with free weekends Of course. That’s what for instance RAV uses in calculation with 21.7 days in a month on average. Uncontrolled period Tagesgeld or holidays are paid as 5 days of holidays per every 60 work days. I assumed that you get at least four weeks of paid holidays as a norm.
Perhaps it’s changed in the meantime, but the contractors I knew in the early to mid 2010s only got paid for the days they turned up to the office.
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Old 15.06.2020, 19:01
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Re: Day rate for contractor

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Perhaps it’s changed in the meantime, but the contractors I knew in the early to mid 2010s only got paid for the days they turned up to the office.
It depends, if you are either self-employed contractor, in which case I have no prior experience with, or contracted by consulting company (hired as an external consultant), in which case they mention hourly rate but rather hidden within fixed annual salary. My last contract 130k p/a total package (13th check included, paid 25 days of holidays age dependent, 1st and 2nd pillar automatically deducted from 10k per month, no travel allowance and no other perks).
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Old 15.06.2020, 21:26
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Re: Day rate for contractor

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It's not great.

Points to consider are you'll probably remain tax resident in the UK if you retain any links (house, kids etc) until you've done a full tax year outside the UK, so that will be until April 5th 2022.

Says who? Do you have a link to that regulation?





If the offer is from a big agency then it's likely there's still several 100s of negotiation available.

Last edited by 3Wishes; 15.06.2020 at 21:46. Reason: fixed quote
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Old 15.06.2020, 22:43
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Re: Day rate for contractor

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Says who? Do you have a link to that regulation?

HMRC RDR3 SRT
This lists the tests, and elaborated here.
I should have used the word 'maybe' rather than 'probably'.
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