It looks like there are more contractor roles then perm roles beign advertised and I am looking at one which I have passed third interview for

The agent has said 800 all in day rate - What does that mean and what equivalent perm salary will that be equal to.

My previous job was 25 days holiday plus bank holidays so that means 215 working days....

In the UK contractors get paid far more because there is a tax fiddle - I guess here that does not apply

You have to pay employers deduction for the equivalent of National Insurance, Pension, Accident insurance & unemployment insurance. Assume those are 12% but it can increase with age.

So daily rate is 714, that includes holiday pay of 8.33%.
Assume your deductions of 12% too so 637 a day you WORK before tax. or 588 a day with 4 weeks holiday paid.

Ask the agency to provide you with a worked example. They do this all the time and it should not take them long to generate one for you.

The spreadsheet should take into account payment for holidays, public holidays, pension contributions etc....

Not that the holiday pay is accumulated by paying you less during each month you work.

Thanks I think I understand the answer. I can’t really ask the agency because it’s direct and I don’t want to burn any bridges

It would help me a great deal if you could comment on what 800 a day contractor would be equivalent as a perm salary. By that I mean if there was two options from the same employer for the same job what would the perm salary be

800 would be about 130k with decent pension to 140k without, gross salary before employee deductions based on working 20 days per month. Less for 215 days a year - maybe 115 to 120k.


I think it's reasonable to ask the agency what it means to get 800 all in. I don't understand when you say it's direct. Are you a man or a mouse?

Direct means the client is talking to me - Well their contractor desk is. There is no agency .

So just on your figures if you were offered 800 OR 120K perm for 215 days would you always go perm> Are there any hidden benefits of contractor like easy access to rav as a cushion / tax optimisations / dividends etc?

Or is perm always much better

We all assumed there was an agency involved by your use of the term "agent".

I've juggled the same numbers a few times and I think it comes down to personal preference - as a contractor you're getting up to 1k CHF more net but you also have the threat of imminent unemployment hanging over your head.

Well I would be very surprised if a major corporation deals with you directly in the end.... so it will depend on how you end up having to set things to satisfy their requirements


If you don't have the conversation, you are not going to be in a position to decide if it is worth while or now..... perhaps they will require you to go via their preferred agency (I know one bank that does this, their contract office even includes one person from the agency), an umbrella company, a temporary employee or be properly set up to body shop.


Back in the day, when I worked freelance my break even rate was CHF125 per hour (this was before all in rates etc...) for a 120k permanent job plus perks. But in those days the perks were an awful lot better than today in the banking world and hourly rates were the standard.

__________________
"There is no passion to be found playing small - in settling for a life that is less than the one you are capable of living." - Nelson Mandela

Payrollplus has a useful calculator here: https://payrollplus.ch/en/freelancer/calculator/

In banking when the perks can be half your salary or more, this somewhat skews the comparison. That's why it's important to know the details of the perks, not least the pension, from both sides before you can make an informed choice.


I always deal with clients directly, even when there's an agency involved but in the end you need a payroll company (not necessarily an agent, and agent is the wrong term anyway)


People think perm jobs are secure - they're not, not these days, but you might get better conditions when you're chucked out.
I've been a contractor since '96. The only contract I had that wasn't renewed was in 2009 and they paid me for my notice period on garden leave, much to the annoyance of the permies.



For perm vs contract you just need to google.


BTW, as a contractor through a payroll company you're still a permanent employee. Expenses for tax reduction are long gone. Conditions can vary but you would enjoy all the mandatory protections as a contractor as you would as a permanent.

I did not include the bonus in my calculations. But from what I remember and it is a long time ago, I took pension, disability and loss of income into account.