Re: Seeking assistance-contract rates

Subject: Re: Seeking assistance-contract rates
From: "Tim Altom" <taltom -at- simplywritten -dot- com>
To: "TechDoc List" <techwr-l -at- lists -dot- raycomm -dot- com>
Date: Mon, 21 Feb 2000 09:11:56 -0500

Yep, that's a standard markup, and if you've ever been in the business of
*supplying* labor to clients, you'll know why. The standard markup is often
100% because of the heavy costs of sales, taxes, office expenses, management
costs, and so forth. If you're being put into a chair for less than a 25%
markup, you're a loss leader, a client sop, or the agency is hoping to make
it up in volume or in some other category.

One of the biggest problems new independents have is envisioning how very
much it costs to be in business. Many writers "go independent" without
knowing this fact, and it can be devastating if you have to live on the
money. In many places, $20 per hour seems like a munificent rate, until you
calculate all the expenses. If you're being put to work 40/52, then you can
make a pretty decent living on that rate. But if you're like many
contractors, you may not work for 52 weeks. Projects die. Money runs out.
Agencies get fired.

> 1 - I understand that agencies may charge clients anywhere from 25% to
> 100% of the rate they offer consultants. In other words...the agency pays
> consultant $45 per hour, but they collect $75 to $90 per hour from the
> client. Is this correct??

The pay situation is peculiar to your state, and to your own contract. Some
contracts call for 1.5; others don't. In most jurisdictions, the agency
isn't forced to do very much at all. It's in the contract, so ask lots of
questions and read the document thoroughly.

> 2 - This would be an hourly rate contract, at 40 hours per week. Is the
> agency obligated to pay time and a half for overtime? Or just straight
> rate regardless of the total number of hours per week?? BTW...Peter Kent
> discusses this topic in this book and seems to be of the opinion that
> should receive OT pay, at time and a half.

Sure...let your lawyer see it. If you're a contractor and you don't have a
lawyer you can trust, then in my view you should get one immediately. Being
a "contractor" means to "work in accordance with the terms of a contract",
and to do that, you'd better know what that thing says. Being a contractor
isn't just being an employee with a different word in the job description.
You have fewer protections. State and federal laws don't apply as
stringently. For God's sake get yourself a good lawyer and invest (yes,'re in business for yourself now) in an hour or so to get the
best legal advice you can. This isn't water-cooler discussion time now;
contractors should know exactly what they can and must do under each
contract. When we hire contractors, we have no problem at all with a
contractor taking the contract to her lawyer. We encourage it. It shows a
hefty professionalism.

> 3 - The recruiter mentioned I would need to sign a contract....any
> insights or web sites to recommend on what to watch out for when signing a
> contract??

Tim Altom
Simply Written, Inc.
Featuring FrameMaker and the Clustar Method(TM)
"Better communication is a service to mankind."
Check our Web site for the upcoming Clustar class info

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