Article: How IT Workers Get Conned Out Of An Honest Wage Through Secrecy

Interesting read, although not surprising:

http://thetarah.com/2014/03/19/how-it-workers-get-conned-out-of-an-honest-wage-through-secrecy/

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Comments

SweenMachine

Yeah this is definitely old news and should be pretty well known to anyone who is a contractor at some point in their life...

Interesting read, but nothing unknown...

-scott

Shaaaar

And how would people who haven't been contractors before get this information? The article is directed at people new to contracting and at unethical recruitment and contract policies.

ande0255

Unfortunately to get your foot in the door somewhere, you generally need to start off contracting. Really crappy reality of the industry, but it is the reality in most cities.

Qord

Works similarly for general temp-agency jobs. I was a truck driver for a while, "contracted" out to a company via a temp agency. The company paid the agency ~$45/hr for my driving, and I took in ~$12/hr to drive their straight truck and make deliveries. Prior to that I also did general labor, same scenario. In both cases my paychecks and W2's came from the agency and not from the place I actually worked every day.

The amount paid for my services was not disclosed (found out a few years later after being hired on full-time once NCC/CNC was found to not be of concern) and it was taboo to talk about while employed there. It was definitely "none of your concern", but I don't think it was a fire-able offense to ask about it.

Priston

At one point I was looking into switching contracting agencies thinking my current contracting agency was taking advantage of me. I was told by another contracting agency that my current contracting agency pays me ~80% which sounds pretty good and would mean the company I work for is taking advantage of me : (

Keroseen

Worse yet, is if your a sub-contractor, to the prime contractor.... The customer thinks you're being paid an obscene wage, when in reality, you're lucky to get half of what they're charging for you after everyone gets their cut. The direct employees resent you because on paper you're making twice as much as they are. What a racket!

eansdad

I've worked contracts with multiple vendors doing the same job. Pay range was huge $8-$25 for the same job, just depended on which company you were with. I still fail to see how a job that would pay $20/hr and benefits is a better deal at a flat rate of $40 or more!

no!all!

I'm a contractor myself and I've always wondered what the client bill rate is...good read!

tpatt100

I worked a contract for a few years and we had sub contractors on our contract which really made me wonder what our hourly rate was.

N2IT

As a manager for an MSP several years ago the margins between the techs and the actual work effort would vary but if the tech was fully utilized you could have margins well over a 100%. We tried to stay away from T & M and focus more on activity based billing.

Rosco2382

I honestly didn't know that it was that big of a gap between what they billed and paid. I am sure not all are structured like this. I am glad I knew what I was worth and found a direct hire position. It pays roughly 45% more than what recruiters were offering and I get great benefits. There was one agency here in Chicago that really put me off and even told me to my face that I am worth X amount of dollars, so good luck finding a job that will pay me what I wanted. I should of sent them my offer letter. Well enough of my ranting.

spiderjericho

Isn't that how temp and contractor work? The middle man is always trying to make a pretty Penny at the expense of both parties.

I'm sure I have to look forward to this after military retirement, especially being a minority and ex military whose experience is going to be undervalued due to the nature of the military COMM field.

networker050184

Being ex military will not be an issue for you. Military experience is over valued if anything in my experience.

--chris--

ande0255 wrote: »

Unfortunately to get your foot in the door somewhere, you generally need to start off contracting. Really crappy reality of the industry, but it is the reality in most cities.

Pretty much this, for many people. Contracting gets your the experience that your resume really really needs.

I get $15/hour contracting here. I know the organization I work for pays about $80/hour for me to be here. I don't see how this can make sense on paper, but it must because everything is dollars and cents when it comes down to it.

coreyb80

--chris-- wrote: »

Pretty much this, for many people. Contracting gets your the experience that your resume really really needs.

I get $15/hour contracting here. I know the organization I work for pays about $80/hour for me to be here. I don't see how this can make sense on paper, but it must because everything is dollars and cents when it comes down to it.

Funny you say this because before I landed my current contracting gig I couldn't get a call to say my life. Been here 6 months, between learning and working w/ many different technologies my resume is now appealing to many. I've been on a couple of interviews and even have a pending job offer for a permanent gig. Not a really a fan of contracting, as this is my 1st time, but it does give you what you need in order to get to where you want to be and then some.

jamthat

$22/hr from a staffing agency at my last job. When I told them I might be leaving (3 months after starting), my recruiter called and said 'We can up you to $30/hr if you stay, does that work for you?'. Maybe if you had 'tried' to get me that rate in the first place

darkerz

Contracting rocks, you get to experience new things every 6 - 18 months, touch projects, and your responsibility only grows and technologies will advance.

It's better to hop contracts than FTE roles. Also, you're always under pressure to study and learn more - you have a literal expiration date on your livelyhood.

--chris--

darkerz wrote: »

Contracting rocks, you get to experience new things every 6 - 18 months, touch projects, and your responsibility only grows and technologies will advance.

It's better to hop contracts than FTE roles. Also, you're always under pressure to study and learn more - you have a literal expiration date on your livelyhood.

Good way to look at it. Pretty much how I have felt since day one here. My contract is 12 months, in that time I plan on getting another 25% of my BS done, a few certs and adding 12 months of IT experience to my resume. Honestly, having the pressure of needing to look good to future employers really is a great motivator

I would like to stay here and go internal, but I don't plan on that offer being extended. I need to be able to jump ship (to better paying ship) when my time is done here.

@ the larger issue that this thread is about. Contract companies may be guilty of it, but so are just as many employers that dangle the "IT Intern/Entry level IT job" carrot out there when they know talented folks will work 6-12 months for fast food wages just to get some experience on the resume. Look at how many people on here suggest volunteering to get experience. Do accountants/nurses/cops do that? I know those are not apples to apples, but nothing is in this line of work.

The other thing I wanted to make a thread for but never did (but will ask here since its the topic at hand). In the article she mentions that contractors make sense for temporary work, like the Python example she gave in a C++ house. But why do some companies contract out permanent work?

Like the place I work, pays $80/hour for the contracted permanent desktop support guys/gals. Why don't they bring us all inside, cut out the middle man and save some money? I realize benefits will blur the line some, but I doubt $15/hour in wages + benefits would add up to $80/hour.

I realize that paragraph can sound angry or upset, its not meant too. I just approach things from a business perspective since that's where the core of my experience comes from. I don't see how this makes sense on paper.

Keroseen

--chris-- wrote: »

Like the place I work, pays $80/hour for the contracted permanent desktop support guys/gals. Why don't they bring us all inside, cut out the middle man and save some money? I realize benefits will blur the line some, but I doubt $15/hour in wages + benefits would add up to $80/hour.

The way it was explained to me at one point by a hiring manager, is that contracting keeps people in line. People work very hard when they know all it takes is a call to the contracting office representative with a complaint, and they're out the door. The "inside" guys I know have unions representing them. Not so easy to get rid of them when they fall out of line. Most companies don't want to deal with unions, unemployment insurance, wrongful termination suites, pensions, etc. So for high turnover positions, buildouts, etc, it's a lot easier to higher a contractor.

Verities

I'm only making $25/hr as a sub k (I can't imagine how much the primary contracting company is billing for my time). The company I'm providing services for is saving roughly $10k-$30k (information gathered by eliciting salaries from members on the team I work with) by not bringing me on as a perm employee, that's not including potential overtime. Contracting, especially with the government, is a dirty job but it pays the bills....sort of

eansdad

We just had an RFQ done to outsource our department...came back at $100/hr. I'm just glad MSPs are greedy...

mikeybikes

I've worked two contracting gigs. Mostly call center stuff. The whole setup is a scam. At both, I performed the same job as the FTEs and made between a third and a half of their wage. No benefits, measley amount of PTO, it just was never worth it.

This is the one thing about the tech industry that I find disgusting.