Barclays is cutting IT contractor rates by ten per cent across the group, less than a month after cutting 1,800 IT jobs. Back in May Barclays Capital forced contractors to take a ten per cent pay cut, and now the policy is being extended to the bank's global retail and commercial banking business. From 31 August, anyone who …
I got the call yesterday
I'm going to walk. Fuck 'em.
Contracting versus Permanent Staff
I think that contractors should always be used as a flexible work force, that should be the first to be challenged when the squeeze is on. That flexibility should be used to protect the permanent staff - that's why permies accept the lower compensation - it's meant to bring them more job security. I don't have a problem with that - even though I am a contractor.
Contractors can always vote with their feet if they think that they are being unfairly squeezed; however, if they doubt that they could get a job elsewhere at a similar rate in the current climate, then maybe the bosses have got their sums right, and a 10% downshift is appropriate. BTW don't you think that 'slash' is a bit perjorative for a 10% reduction?
C'mon John, finally an appropriate use for "Decimate" without all the whiners having a go!
Been there, done that
My lot (another bank) did the 10% cut a couple of months ago.
Whilst it might seem like a good cost-cutting exercise during a squeeze, we've already had one "we shot ourselves in the foot" incident that I'm aware of - the contractor next to me told them to stuff it, left at the beginning of July, got replaced by someone 10% less able, and one of the system failures that the ex-vulture could have fixed in 2 minutes has cost the bank more money than they would have paid him to stay for a couple of years.
Flexibility isn't the only reason contractors get paid a lot.
They're still hiring though
It's not that they don't have enough work (HBOS this is), they aren't cutting contractors or permies, and they are still hiring contractors for certain roles. They've just decided that they are paying too much and cut the rates they are paying.
I got the call a couple of weeks ago...
I walked; I start elsewhere on Monday, better rate, better job.
I had this...........
or at least something similar a couple of years ago whilst working for Barclays Business Banking.
I got a bollocking for "only" taking half an hour for lunch (as opposed to the full hour that perm staff took) and when I pointed out that my contract said that only I got an hour and that I had been completing timesheets reflecting that, I was told to start taking an hour or find somewhere else to work.
I chose the second option on principle.
so how does it
work from a contract point of view ?
if you have signed up for X amount of period at X rate, then they turn around and go actually we are only going to pay Y rate
do they have to wait for current contracts to run out ?
Interesting approach to agreed tariffs
Normally the price a contractor charges is set after negotiation. In other words, this is a mutually agreed contract, and in general a contractor does not have control here.
I can't see this one fly without some serious problems. If there is a market "out there" I suspect they will only get away with it for so long the contractors have not found new jobs,
Wrong way round..
They should threaten to cut the rate and then sack everyone who would've stayed.
This way they're keeping the dross..
A striking demonstration of ignorance
As someone who banks with HBOS, and thus relies on the accuracy, efficiency, and robustness - not mention security - of its computer systems, I am naturally overjoyed at this news.
Clearly the executives of HBOS believe that IT contractors are fungible; faceless "resources"; interchangeable. In short, a commodity. When buying a commodity, one pays the market rate, because it's all the same. (Even that's not quite correct: there are different grades of sand or pork bellies).
The bank executives themselves, of course, are entirely different. Not fungible. No way. They must be paid untold millions, because "if you pay peanuts, you get monkeys".
I have never understood the economic orthodoxy that additional payment does not motivate the badly paid, but does motivate the already wealthy. How stupid does that make me? Stupid enough to bank with HBOS.
They get 10% less work done
I'm not getting that, you only took 1/2 an hour when you should have taken an hour (and were filling timesheets saying you were taking an hour), and they bollocked you?
The agency should take the cut. And so should Accenture
I was at Barlcays Wealth a month ago when they cut rates by 10%. Our agency ended up absorbing the cut. Other agencies didn't, and several contractors walked. I left anyway as it was an awful project with Accenture's paws all over it. hmm.. never saw their rates getting cut... even the 'consultant' who turned up every day without a desk to sit at until one of the contractors left!
@Rob St John
You usually have a walk-out clause in the contract which means if they change anything they give you notice and then you re-sign a new contract on the new rate.
Unless like me you've been getting several calls a day about new contracts and have decided that working with W(B)ankers is over rated.
Thanks Barclays, but no thanks!
AC for obvious reasons.
Paris - cause she'd never lower her rates.
Is that legal?
Given all the various laws governing contractors these days, is an employer allowed to single-out a small employee group for a pay cut.
Contractors have been getting f***ed by the Taxman since IR-35 (et.al) and have had to jump through all sorts of different hoops just to stay legal - i.e. proove that they aren't "employees".
So if the Taxman did try to screw one of the Barclays contractors for being an effective employee; then can that contractor turn around and screw Barclays for an unfair pay cut?
... or - as usual - will the contractor just get f***ed both ways...
Is there a case of "wage-fixing" between HBOS and Barclays?
Are there any EU employment laws governing this sort of thing?
How about contract law can they just change a contractor's rate on the fly?
A funny thing about this cut,
and something I hadn't come across before, is that the agencies were told explicitly by (in my case) Barclays Wealth that the cut was to come only from the contractor's rate, and that the agencies were not to reduce their take.
This had the effect of increasing the agency rate and maximising the p*ss-off factor.
@so how does it
Simple - give the contractor the agreed notice. I know of one particularly cheeky agency who told their contractor that they (the agency) had got the contract wrong and demanded that the contractor resigned ahead of time. You can imagine the reception that got!!
Listen to all your pompus indignation. Here's the deal, you get paid good money, when the times are good. Now, when the sh1t is hitting the fan, you have to take less.
All your, "I could have fixed a problem that cost x pounds to the Company...", well big deal. Does a multi-million pound bank get held hostage by some code jockey?
Please, get over yourselves....Its not like you actual generate any revenue, or save lives....
If it happens again I'm leaving....
Happened to me about 5 years ago when I was working for a major pharmaceutical company. Most people stayed but morale hit the floor. I walked as soon as I could find another contract, which incidentally was better paid.
I just refused to cut my rate on my current contract. They just said, "OK, fair enough". Still there on the same rate.
Put my CV forward for 3 roles last Tuesday. Had two interviews on the Thursday morning and two job offers by the end of the day.
Also got an interview for the 3rd role but didn't go through with it as I took the second offer from Thursday.
There is plenty of work out there and it's paying well.
The good guys should walk and leave the sh*t guys to show Barclays and HBOS the error of their ways.
>do they have to wait for current contracts to run out ?
Generally, no. Most contracts have a minimal termination clause. Mine is 4 working weeks, and I think that's pretty much standard.
If my client wanted to cut my rate, they could wait until the end of the contract and re-negociate, or they could give 4 weeks notice and re-negociate during those 4 weeks.
It's generally a little more informal than that - I know of one place doing a 10% rate cut where they gave everyone 6 weeks notice, and for those that chose to accept it instead of walk, there was just a "simple note of modification" for both sides to sign rather than a swathe of re-negociations.
Fixed price contracts ?
If they are just 'bums on seats' and therefore under IR35 they should all apply for "employee" treatment ...
Alternatively if they are each doing a definable piece of work they should tender a proper B2B fixed-price contract for it. If the bank pulls out from that, having earlier signed up, they would then be able to sue for breach of contract.
As regards "market rate", surely you can only negotiate a contract on the basis of conditions at the time ? If conditions change then that should affect new contracts, but the old ones should not change until they run out - otherwise, how does the Futures market work ?!
"Yes we agreed 6 months ago to sell you gas at £X per litre but it now costs 20% more - what do you mean we agreed the price when you bought it ?"
Barclays buying over the odds too
Also HBOS. These two are particularly exposed to the toxic waste clogging the commercial paper system. So no surprise there really. Yet they have the audacity to stand up and ask the UK taxpayer for a bottomless indemnity fund so that they can carry on with many more decades of usury and gouging for their services. (If they actually know what they must write down to comply with Basel II they are not telling anyone). Hopefully Alistair, Darling will continue to resist, tho what McTrousers Brown does now he knows he's cornered is anyone's guess. What the bankers need of course is a wall (not a chinese one) and a bullet (not a magic one).
Sounds good to me
Having been a 'permie' for 22 years and resisted the urge to go contracting and earn shedloads more money for a lot less work I find this story rather heartwarming. In my experience the majority of contractors (note I say majority and not all) are far less skilled than their permenant compatriots and take far less responsibility for things. This is probably from years of working in 'get the job done, never mind the quality, now let's go!' environments.
Probably going to get the back up of a lot of people who've been getting money for old rope for donkey's years, but I'm sure they all have nice fat piles of cash they've been accumulating for years to soothe their sorry brows.
Mine's the one with the slim wallet in the left pocket but a big wad of highly valued integrity in the right.
Re: 1/2 hour lunch
For those asking about the half hour lunch, it's usually an elf n safety thing. The company has insurance etc. etc. and some condition will state all staff must take a full hour for lunch regardless. The same thing happened where I work years ago. It was pointed out by staff that there was nowhere within the building to take a break and what should we do if it's pissing down outside. They built a staff kitchen, dining room and lounge complete with large flat-screen telly!
I've been using the same crappy monitor for six years but they spend a fortune on a staff room mumble mumble grumble....
the San Fran Sysadmin
what would the SanFran sysadmin have to say about all this ?
Hayes... The worst agency to deal with
Another reason I as a contractor avoid Hayes at all costs! They have no regard for the end contractor and will not fight the corner for them.
I was put over a barrel by them when working for BT.
HBOS are cutting 10% from contractor rates (we got the news a couple of weeks back), have stopped almost all permie overtime, and had a £4 billion rights issue that flopped the other week.
Now work is piling up 'cos the permies are working 35 hours a week and then heading home, a few contractors are walking but the majority are staying put, but are so pissed off - not so much with the cut as with the way it was done - they're doing probably 50% of the work they were previously ;-)
As stated it will be interesting to know whether the actual cost of the "savings" will work out more over the long term...
Why did you resist the urge? Was it becuase of a sense of duty to your employer or because it isn't the bed of roses you paint it as (and as this story puts into clear reflief)?
These boots were made for walking...
Ususally the first to go are the best ones.
So, you may get a 10% cut but at what cost ?
False economy in my view.
(I'll leave you to work out why the coat :) )
Barclays insist on a no-way-out clause on the contractors side (at least they did the last couple of times I was there), so they can give you notice, but you cannot leave early without clobbering an exec or something.
IBM have similar clauses as well, so contractors are screwed all ways.
Where I am currently allows me to give 4 weeks notice, but they only need to give me a week. But they want weekly billing, so the notice period matches the billing period, which is how they get around whatever bits of the employment laws that apply to contractors.
No request to drop the rate here yet, though.
@AC re: Hayes
"They have no regard for the end contractor and will not fight the corner for them."
What utter ... ball-ache!
Are you a bit new to the contracting game, or just terminally naive?
I always find iit amusing when contractors complain about the agents looking out for themselves. Who else should they look out for? Do you look out for your agent? Of course you don't. Dimwit.
My closing comment is why I resisted the urge - I value my integrity more than my wallet. My experience with contract staff has been that they range in quality from downright atrocious to 'fair to middling', with only one or two diamonds that have stood out from the rest over a period of many many years. I just wouldn't want to ever associate myself with that group of workers.
And if it's not a 'bed of roses' then why don't contractors just leave their contracts when they end and get permenant jobs? I'll tell you why... because they are coining it in at a higher rate than permies, never have to, or are willing to, work more than their contracted hours to hit deadlines (without being paid even more for it) and once their time is up they can walk off and leave their poorly paid 'colleagues' to pick up the pieces of what they were attempting to put together. Not to mention the fact that the majority of them wouldn't last their probation period in a permie role.
There's the bitter sound of someone who has had to work unpaid overtime whilst the contractor across the way was whistling the merry tune of someone on time and a half.
Done both permie and contract, and I've found useless baboons in both - the main problem for contractors are project managers who provide you with jack all and then place the blame on the contractor when it turns out the end product (based on the PMs info) is nothing like what it should be...
The main problem with permies is that management know they can make them dance like a bitch for no extra cost.
Andy, As a contractor i would like to say my experience, with regards to worthless work-shy collogues is the exact opposite to your own, however I tend to find that you get work shy permanent and contract staff. The only difference tends to be that the contracting staff get the punt in short order (if the organisation has a clue).
As for highly valued integrity believe it or not i suspect a large percentage of contractors, trade on professionalism and highly valued integrity, but we are also commercial business, something that is lost on most permanent staff, in short we do take the good and the bad days and mostly get the job done to a high standard (if allowed).
spot the difference
It's pretty easy to pick the contractors out from the permies based on comments.
There's comments based on a complete lack of understanding of how contracting works or comments based on some sort of unexplainable (to me) dislike of contractors. Or there's people who are contractors who don't like having an agreed rate changed underneath them.
I don't get the comments about contractors being fair to middling, or lazy work shy layabouts or whatever. They've almost all been permies in the past, and in my experience it's only the better permies that make the leap to contracting.
I've worked with a few who've been below par, but I've worked with far more who were at least average or better.
Definitely some bitterness from the permies that couldn't make it as contractors though, either through ability or lack of cohones.
A contract...is a contract...is a contract...or is it?
I've been a contractor / freelance for about 23 years now, and to be honest if my rate was to be cut half way through the contract I'd be leaving as soon as was practicable - I'd do the same if I was a permie and was given a pay cut, after all.
I have eminently sellable skills (so I'm told), good interpersonal skills (again according to the people who I've worked with) and know my stuff; so why should I continue to work for a company who no longer value me?
I've worked on numerous occasions for HBOS and found them to be good employers from a contract point of view; their rates were high, actually - definitely when I was last there (4 years ago) they were paying me a good 10 to 15% above market.
I too have found technically poor people in both permanent employment and contract work; I'm far from perfect myself, but as we are frequently told by banks when discussing overdrafts and bank charges...a contract is a contract. :-)
wondered how long it would take...
I'm quite amazed it took that long for someone to suggest 'lack of cohones' (somewhat ironically that's b*ll*cks in english to the uninitiated) and lack of ability.
I personally think that sticking with a company when they're really struggling through tough times, knowing that you may be putting in a lot of work for nothing but hoping that you and your colleagues can do what's needed to help pull it through and get rewarded at the end shows a little more balls than going and selling yourself to the highest bidder every few months/couple of years. I think there may be another word for that!
As for 'lack of ability'... well I'll just leave you thinking that and laugh silently to myself whilst shaking my head.
And for the record I said most contractors, not all (and re-iterated the point), and I never suggested they were work-shy.
But just to balance the equation out a little, yes I have worked with plenty of sub-par permies as well, both in skill-level and effort put in. And I also have mates who are contractors - see I even socialise with 'em. But it has to be said they agree with my point that there are an awful lot of sub-standard ones about.
Maybe I've just been unlucky with the contractors I've had to work with over the last couple of decades!
And a smiley face because the contractor posts outnumber the permie ones by 4 to 1, which proves they're all out of work or they spend all afternoon on the Reg whilst charging their employers (now if only there was an icon for tongue in cheek)
Aaahhhh so it's come to....
working for the IT dept for Berklays Wank for minimum statitory rates
(if they could get away with paying less, they would)
Thats why all thier IT Dept's are staffed by (FORIEGN)! nationals...
(they get paid in Rupeess (equivalent to £5.00 a day) with a free pack of peanuts thrown in!.
i wonder how long it will take for all that customer data to wind up floating about indo-asia along with the contents of all thier accounts....
only a matter of time....
as the old saying goes... pay Peanuts, get ..............
@Barclays buying over the odds too
The Chinese don't use walls. They make the bastard kneel in front of a crowd (usually the friends and families of the victims) and shoot him/her in the head with a single pistol shot !! *THEN* they charge the family of the perp for the cost of the bullet before they can take that carcass away !!
Oh for Goddess's sake its 'Cojones' you ill educated peasants
And whilst I'm at it, @Andy Bottomley, FFS.com get a grip boy, you should see my current contract, here I am paid a sad old developer wage in the Midlands (no City slickers here) and yet I'm running a team and being a PM and dealing with management and all sorts. Blimey. All that on a daily rate too. So, no extra pay for overtime or conning the company with short lunches.
What *is* the going rate
For a contract solution architect in London these days?
And what sort of chargeout rate do Accenture and the like expect?
Times are tough - let's increase the BA/Project manager spend, I mean outsource
When the inevitable downturn comes the major banks always cut rates then look to outsource. One of the people mentioned in this article now have, in one case, 10 people in London and one developer abroad working on a project now doing the work of one London based BA and one London based developer. How is that cost saving?
It' begs the question - have our secret Lizard Overlords replaced all of the sensibe IT managers with thoughtless drones or something?
What amuses me is that anyone considers their job "permanent". Those that do are usually the most shocked when made redundant. Truth is most contractors have accepted uncertainty and live with it.
Presumably you'd have no problem then if every one of them just left? I thought so, but here's the thing, you might think you have a clue about how your systems work but you don't. And as for people like you, you don't generate revenue either, you spend it. No I don't care what job you have, you aren't generating a single penny. All you do is whine like a baby when you can't figure out which socket the keyboard plugs into.
The only people that generate wealth in a bank are its customers. And banks could do just as well without any of the financial dickheads who thought they were so clever reinvesting the huge profits from subprime mortgages into hedge funds that went bust.
Or perhaps you were one of the morons that thought investing in mortgages for the homeless was a cool idea in the first place? Who cares. What I do know is the banking world has been fucked over by pricks like you, who thought gambling on the stock market with your customers' money was okay.
I'm not talking about investing people, it's pricks like this one that cause banks to fold. They gamble on the price of commodities and stocks. Its no different to betting on a horse race or playing a casino slot machine. Eventually you'll lose, unless you have insider knowledge and can cheat.
That's the real reason banks are so fucked up, not the drivel about people not paying their mortgages. Foreclosed properties lose around 10-15% of the money invested in them. However the interest rates and fees paid by bad-credit customers more than cover this if the customer makes his payments for around 18 months. Anything after that is pure gravy, especially if you actually get a loan to reset. No banks have had the shit hit the fan because of what they did with the money paid to them. These so-called financial advisors over-extended their employers, hoping their gambles on currency, hedge funds and commodities would pay off.
Andy, you're a twat.
Andy - you make some valid points - well, the one about there being bad examples of both permies and cotractors is. Pity you had to make the gloating comment about people being out of work - that shows the mean-spirited kind of person you are. (In case you're curious, yes I am unemployed. So have a good yuk.)
As usual, a lot of the problem stems from management more than anything else. Whether permie or contractor, whether you're taken on/kept on seems to be more the old problem of whether your face fits, not competence.
And, of course, contractors naturally get the blame when it goes tits up. True, whether you want to admit it or not. As for integrity - made that mistake and paid a price for it. Managers don't seem to *want* integrity from contractors, or real dedication. More important to emphasise that they're shit than can be replaced at any time. If thre's no hope of reward (that thing you hope for,) then why bother? Sounds to me as if you're just part of the furniture where you are, presumably having your ego stroked. So sure you can't be replaced? Why? Go skills nobody else has? Unlikely. Got knowledge of the systems you don't share so people have to ' ... call Old Alan in. He's the expert." ? Not very professional, there.
Simple fact - if contractors are the money sink they're portrayed to be, they wouldn't be hired. Why don't they hire more permies? I was told "Budget doesn't permit it." What? But permies are so cheap and dependable! And dedicated beyond belief!
the 'permie' City boys with their big £100k bonuses never get people as annoyed as hourly-paid contract people ..
For your information I wasn't "gloating" about people being out of work - because the story isn't about people being put out of work, which you would have noticed if you had bothered to read the original article you complete imbecile. I was expressing my belief that it's nice to hear that they are reducing the rates of those who usually charge much more than they are worth, rather than put anyone out of work - the complete opposite of what you are implying!
Did I say there was no hope of reward where I am? Errrm.... actually no. I've been rewarded more than once thanks, due to the startup company of 8 years ago, where I still work, now being the biggest of it's genre in the UK. In fact you ask a lot of questions about me and then promptly answer them yourself, with no knowledge at all of me or my employer. Are you psychic? Given the accuracy of your 'answers' I reckon that's a 'no'.
I'm certainly not labouring under the impression I can't be replaced - everyone's replaceable, whatever their field of work. And do I have skills that other don't have? I reckon I do yes - I also reckon there's plenty of people out there who have skills I don't have.
And finally your 'not sharing knowledge' comment is laughable. I've lost count of the number of times I've had to explain how some systems worked to someone, only to have to go over it again, and again, and again with that same person, sometimes over the course of 3 or 4 years. And before you jump on that one I'm talking permies and contractors here.
Next time you comment on something try actually reading it properly first and trying to gain an understand of the points before you make yourself look stupid. Numbskull.
Credit Suisse too
Credit Suisse are asking for 10% cut too. Time to walk, not a chance of me taking a cut.
Vote with Your Pocket
Just don't give custom to slime-ball employers.
I moved the company accounts a few years ago. I'm a few grand a year better off for it and derive some satisfaction from knowing that I'm not propping up this particular shabby regime.
For the same reason, BT was slung years ago, also resulting in cost savings.
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