IBM UK is cutting some contractor rates. IBM UK uses Hays, a specialist recruitment group, as a source for contract staff. According to Claire Fowler at Hays, "This week technical subcontractors engaged on IBM business have been notified of changes to their daily rates." She added that Hays always tries to ensure rates are fair …
I contracted for IBM for 3 years between 99-02 and was asked at one point by the agency to take a 10% cut in pay. I categorically refused and heard nothing more about it.
May be different this time though.
10% be damned.
10%? My agent said 15%. Are they keeping the other 5% themselves?
I already took a 12% rate cut from my last contract (not IBM) when I accepted this one. A further slice just takes the biscuit (or even the bread off the table!)
There is no harm in asking
If the contractors take 10% less, that means several times more money for the salesmen and bosses. So why wouldn't they ask? Loyalty? The sanctity of contracts? Those are concept for the little people.
But if you are valued contractor you can say no.
Its all about the margins...
Do you think that IBM is reducing rates to their customers?
I doubt it. Not on existing contracts.
IBM is taking advantage of the economic climate to squeeze even more margins to keep showing record profits.
You can only squeeze a company so far.
Flame to IBM, moving jobs to third world nations and now for cutting rates to subs that keep you afloat with local talent.
IBM Sweden are also cutting contractor rates by 10% here as well. But only on selected contractors - for selected read well paid.
My agent told me that quite a few (40% from his agency) have said no and will walk.
IBM has quite a few warm bodies on the bench at the moment - drawing their salaries and not billing customers a modest fee. The plan is that the warm bodies will be pushed into any role. Need I say there is no budget or resources to retrain .
As always it is the best contractors who will be leaving.
I have been sent an email that Hays is telling people all contractors are being asked to accept a rate reduction of 15%.
My experience with Hays tells me.....
That they are not one of the agencies, that really look out for their contractors.
The term cowboys and crooks come to mind.
When the market is quite buoyant, they are a little bit more friendly, but otherwise if you don´t want do what they want, they will drop you like a hot potato!!!
Apart from that they are unreliable in terms of communications.
That´s why any email from hays, doesn´t even get to my inbox but is directed to /dev/null.
Having freelanced in the IT industry for the past 15 (fifteen) years, the UK agencies are generally amongst the worst (sorry to say, but that´s true!!!)
best experience I have had so far is with Germans and Swiss.
But Hays (but that may just be my experience, so totally subjective!!!) is an agency to stay away from!!!
History repeating itself
IBM, like all big businesses jump on any excuse to screw the little guy. It's no longer about making a profit: it has to be an obscene profit! And IBM + Hays have a history of doing this. Around the summer of 2001 NTL (now Virgin) outsourced all their I.T. to IBM and all the incumbent contractors were handed over to Hays whether they wanted it or not. A mandatory rate reduction was slapped on, with the option to leave if you didn't like it. If you decided to stay then the T&C's were straight out of an Orwellian parallel universe. e.g. they could dump you with 2 weeks notice, but you had no right to terminate prematurely, etc. Hays didn't get it all their own way either. They were forced into reducing their rate uplift, but in return they got a much bigger slice of the IBM pie. If I were a betting man I'd put my money on there being a similar kind of deal under the table.
Well yesterday I got a call from Hays "offering" a 15% cut - - I told them to stuff it....
I have been asked to agree (by return email) to a 15% rate cut with 7 days notice. There is nothing in the contract that says they can vary the rate, I have been advised by PCG legal to negotiate on the cut, surely Hays should do that but are not offering any help. With only 4 weeks left on my contract I am not sure what to do. Bet IBM aren't cross charging the customer less for us. This week my council tax bill amongst others have risen, talk about kick you where it hurts.
I am contracting with Virgin Media also through Hays (voted worst agency ever). We have been told to agree to a 10% pay cut by 03rd April, or leave.