I spent the first several years of my career as a recruiter placing professionals in contract roles. Not all contracts roles are the same. It’s important to understand and know what questions to ask before accepting any contract position. In this article, we’re going to discuss temporary contract roles.
Temporary Contract Roles - What Are They?
Temporary contract roles have a specific end date. They happen when a permanent employee is on long term leave or maternity leave, if the company has an influx of business that requires extra temporary help, or if a permanent employee left suddenly and they need help asap.
How Staffing Recruiters Charge the Client:The recruiter determines the market value for the position based on 1) what the client has outlined in the responsibilities 2) by researching various salary guides and online salary sites, and by 3) by reviewing pricing data in their database for similar roles.
Once they define an estimate of what they can offer you hourly, they’ll add their profit markup and burden cost (cost for hiring you as an employee of the staffing firm, administrative, payroll, taxes, etc.). The end number is called an Hourly Bill Rate. This is what they charge the client
Can a temporary position go perm?
Well, it all depends on the
reason why it’s open.
You may have a shot of a temporary contract position going perm IF: Someone recently left and you’re filling in for that gap. While the company is gearing up for a full blown search, you're IN the role doing the job. Think of your temporary contract role as a long interview.
Someone is on maternity leave. The employee may decide at the very end of her maternity not to return. New moms, especially if it’s their first child, often choose to stay home with their new baby and resign on the last day of their paid maternity leave.
You wow them so much and are such a rock star professional that they CREATE a role for you, despite the fact no permanent role existed when you started the assignment.
I have seen each of these scenarios happen:
How to Negotiate a Temporary Contract Position
You Have More Power Than You Think!
Think about this for a moment… If you accept a contract and leave in the middle of it for a better opportunity, the company will be in a bind waiting for the staffing firm to find a replacement. They’ll have to train the replacement which can take weeks. The last thing the recruiter or the company wants is for you to leave in the middle of the contract. It’s too costly.
When negotiating your hourly rate, ask for more per hour than what you normally make by the hour. Why? Because you should be compensated as incentive to stay in the contract position to the end, despite what other opportunities may arise during the assignment. This is your bargaining power but don’t get greedy! A couple extra dollars per hour is fair.
When the Temporary Position Gets Extended
It’s not uncommon for a temporary position to get extended at the end of the original set end date. You don’t want to find yourself in a temporary contract position that keeps getting extended every three months without negotiating a bump in your hourly rate when it happens.
Consider discussing this scenario with your recruiter before you agree to the contract. Tell your recruiter upfront that if the position is extended, you’ll want an additional $1 or $2 per hour. They may not put it in writing, but by hearing them verbally agree, you’ll be able to establish trust. If they renege on their promise when the contract is extended, consider finding a new recruiter.
Ask the Right Questions!
Before you agree to an interview, here are some questions you should ask your recruiter:
Question: “Why is this a temporary position?
Why is the client needing someone?”
You want to know why the temporary contract is open so you can determine your odds of going of it going perm or getting extended.
Question: “Are you certain that this is a temporary position and that is has a set end date?”
I’m amazed at how often recruiters don’t know the answer to this question. They are in such a hurry to take the order and present candidates and don’t get all the facts. Push your recruiter to find this out.
Question: “Have you agreed on an Hourly Bill Rate or Hourly Bill Rate range with the client?”
You don’t want to spend the time going on interviews and getting excited about a contract opportunity only to have the recruiter come back to you and say that they can’t pay you what they originally promised.
If they haven’t firmed up the Hourly Bill Rate, it might be because they need to know what your hourly rate will be so that they can add their markup on top. This is perfectly OK. You’re working together to create a win/win/win. Be honest with your recruiter about what you want based on how they’ve described the role, but let them know that your hourly rate may need to adjust once you interview with the client and learn more about the scope and responsibilities directly from the client.
Question: “If this contract gets extended, what are my options for opting into your staffing firm’s health benefits plan?”
After X number or hours of consecutive employment with a staffing firm, many offer health benefits. If this is important to you, find this out up front.
Question: “How much notice is the client required to give you if they end the contract early?”
Some staffing firms require their clients to give one or two weeks’ notice if a contract ends early. Others do not and you could get let go with no notice. You’ll want to find this out.
Question: “How much notice am I required to give you if I leave the contract early?”
Some recruiters ask that you give one to two weeks’ notice. Is it in writing? Did you sign an agreement with them that obligates you to this or is this a “gentleman’s agreement” that you’ll give them some notice?
I had great a relationship with every contract professional I placed and because we had established trust, they often told me if they were close to an offer for a perm role or looking elsewhere for something permanent.
I appreciated this because it enabled me to quietly look for a backup candidate. If they resigned early, I informed the client and then called the backup candidate about the opportunity. If they stayed in the role for the duration, the backup candidate would get placed elsewhere.
If you trust your recruiter and have a relationship with them, let them know in advance. They’re not going to tell the client. What you’re doing is allowing them to have time to do damage control by having someone ready to present when you resign. They’ll love you for this and stay very loyal to you in the future.Things to Know:
The client/company does not know what the recruiter is paying you. Recruiters like to keep that confidential. However, they will try to place a person who is approximately within a range that they think the client would be open to IF the position were to go perm. Recruiters always try to push a client to take a contract role perm. That's their end goal.
The recruiter will not tell you what they are charging the client – the Hourly Bill Rate.
How to calculate your hourly rate when you've never worked contract:
Take the salary you're wanting and divide it by 2080 which is the average number of working hours in a year. Note: You may want to bump this up a couple of dollars if you have to pay for your own benefits or if the staffing firm's premiums for benefits is exceptionally high.
During your interview with the company, ask them directly why the position is open and how long they anticipate needing you. I highly recommend this because newbie recruiters might overlook or misunderstand what the client is looking for and relay incorrect information to you.
If the temporary position does end up going perm, RENEGOTIATE your permanent salary.
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