Contractor Truths That You Must Know
Contractor Truths – Agents are not your friends. They will try every trick in the book to take as much of the money you earn as possible, trick you into giving up leads, and lying to you on umpteen issues.
There are several things that contractors setting out in their career need to know and take into account.
Beware of Agents
Agents are not your friends. They will try every trick in the book to take as much of the money you earn as possible, trick you into giving up leads, and lying to you on umpteen issues.
Accountants are your best friends. Whatever trouble you get into, they can get you out of it, or at least alleviate it somewhat. Never be afraid to take them into your confidence in financial matters. The Inland Revenue normally comes off second best to them
Kick Agency Habit
It’s much better to do without agencies altogether if you can. It’s not that you’ll earn that much more money in the first instance if you go direct, as clients will want to get you cheaper.
However, it gives you a different status as a businessman or woman in your own right at the company, and you will find it easier to look out for more business opportunities from your client, without having restrictive agency contract clauses hanging round your neck
Expect a Downturn
There is going to be at least one downturn during the time that you are a contractor. There seems to be about one a decade (usually during the first half of it) lasting around a couple of years. During that time you may be out of work for long periods. Ask your accountant how you should prepare for it.
Make sure you have saved up enough to tide you over it ? and make sure you are not fully stretched as regards mortgages, car loans etc.
Governments Are No Help
The Government (any Government) is always going to be a dead loss to contractors. Everything that they do to ‘help’ the industry will not work out to the benefit of contractors. The only ones that it might help are the big IT consultancies
Prepare to Meet the Taxman
At some stage the Inland Revenue are going to ‘try it on’ with you and try to get more of your hard earned money. This might be through a tax on contractors like IR35 or Section 660, or it may be an individual pursuit of you. Keep in touch with your best friend, your accountant, at all times
Keep Permies Happy
Don’t annoy the permies at work. They almost always tell the boss, who is responsible for your renewal, if you’ve upset them. Don’t say things like “My time is more expensive to the company than yours”.
Help them out when they ask you to
Beware Lying B*stards
When agents tell you that you have to make up your mind that day about whether you’ll take the contract or not, they’re almost certainly lying (they do a lot of that). If you tell them that you’ve got another interview in two days time and want to wait for the that, you’ll find that your agent is very good at putting their client off for a couple of days
Beware other Lying B*stards
When agencies ask you for the names of other companies where your CV has been sent, so that they don’t send your CV there, they are deceiving you. All they want to know is where the jobs are, and then they will put someone up in opposition to you, probably telling the client that you are no good
No Quick Exit
Despite what you think, you won’t be “out of this game in 3 or 4 years with the money I’m making”. Your spending will increase accordingly, you will spend much of what you have put by in the periods when you are between contracts, and you are likely to be in it nearly as long as a permie.
When the next downturn comes, you may well try to become a permie anyway ? but at the same level of a company as you were 5 years before when you started contracting..
After a few years, you will start to bump into people who used to be at the same level of the company as you when you were permies together, but who are now spoken of reverentially by those at the same level of the company as you as “the big boss”.
It’s then that you start to feel that life has passed you by a bit.
Those are the main contractor truths. Bear them in mind.