Barclays Capital has told IT contractors and temp staff that they have to accept a 10 per cent cut in their rates. The investment banking division of Barclays Bank told their temporary workers that the cut would come into effect on 5 December and they had until 11 November to let it know if they did not wish to accept the new …
"Barclays Capital has told IT contractors and temp staff.........
.............that they have to accept a 10 per cent cut in their rates."
Amazing how these (w)bankers appear to be of the opinion that everyone else should accept cuts in their remuneration except them. Also fascinating that they do not seem to make the connection between this kind of "cost control" and their websites going down the kahzi regularly. This degree of short-term stupidity, greed and arrogance is on a scale damn near unique even compared with the rest of the business world's leading managerati. When the revolution comes and they're put up against the wall can I, please, please be allowed to lead the firing squad?
Also, they may state that your service ends on 2nd December but, given most will have one month notice periods, they'll be paying at least 7 days past that - like it or not. This is the reason I've never contracted with BarCap - they're pricks.
You talk about one month notice periods. In fact, notice periods can and do vary considerably between nothing and (extraordinarily in my experience) a month.
However, regardless of the length of the notice period on an individuals contract, as a contractor you want to be walking away from there with a half-decent reference. Would you really want to tug the tigers tail on the way out?
They need to learn the lesson of Pakistani cricket - namely, that poorly paid people are far more prone to corruption.
So, keep cutting the IT support staff wages and eventually someone will offer an IT support worker a nice pot of money to install a trojan/keylogger and the subsequent losses will number in the billions.
Stupid, lazy management
But what else do you expect from bankers? Can't be arsed (or, more likely, are technically and intellectually unable) to identify better/worse performers, so (of course) capable staff will tend to leave and the dross will tend to stay on (probably doing 10% less 'work' in retaliation).
Can't see that backfiring..
I'm not affected by this, but if I were, I know what my attitude towards working hard would be. 10% less money? 20% less work.
I had a manager once who, after 10% rate cut, thought I would like to work extra hours to make up the short fall (I was on an hourly rate)
Hmm, what a signal to send..
Why, if you're any good, and have choices would you decide to go and work for banks that do this?
From a business risk point of view, as a contractor, if you're deciding between contracts this has to be a factor against. Market forces would seem to imply that contractors would want higher rates from banks than other clients, to take this risk into account - or they can take the low end contractors that noone else wants, for cheap.
and here in 6 months when all of their talented people leave for places that actually pay decently and all of their gear falls apart they will probably ask WTF is wrong!
But as long as they can pay themselves 7 figure bonuses for saving on contractor bills, do you really think they care?
Especially when they can pay themselves another huge bonus down the road for sorting out their self made IT crisis.
I've heard RBS have cut their contractor rates dramatically....................
Good on them.
Most IT contractors in banks have always been overpaid for what they're worth. Then again garbage only attracts flies in the first place, right?
I would cut them by 50% and that's still paying a lot. Gets you ready for when the Chinese take over.
@AC 13:59 awww. bless...
permie by any chance? Here's hoping santa brings you a backbone for Christmas
That's what contractor populations are for. It's easier to bin a contractor than a permy, thus contractors are always kept on the books so they can make an instant savings if they need to. None of the critical people in the teams I know are contractors. Given my above statement that would clearly be folly.
Oh, and the 10 day thing over Christmas? Been standard for years.
Short sighted opportunism
I am an IT contractor at BarCap and I spent yesterday afternoon updating my CV. One of our best guys has already handed his notice in. This is a stupid time to do this, as many teams are working hard to get their projects in before the Christmas change freeze.
The rumour is that this comes directly from Bob Diamond.
Barclays have performed well during the downturn, they should show some loyalty to the colleagues who helped them achieve this.
No sorry, still can't parse bankers and loyalty in the same sentence.
Let's see if the free market works.
if those affected are unhappy (bearing in mind salary is *one* factor in deciding where and who to work for) then can they jump ship and get a new contract at the previous rate elsewhere ?
If they can - then Barclays will suffer, and eventually have to raise rates.
If not .....
10% a lot
is still a lot.
My heart bleeds.
It was f#€$ing Barclays...
...who started this shit last time round and then everybody else, most notably RBS, then jumped on the bandwagon. I love the way they seem to think that they have no need to honour contracts. "take the cut on a previously negotiated contract or we will can the contract'". Fuckwits. Perhaps I should try the same approach with my mortgage.
My guess would be that the agreed contracts permit variation of the rates (or equivalently, termination and beginning a new contract) in precisely this way. Of course, you're free to try to insert your own special terms into a contract with a bank - good luck with that!
If you've managed to slip cancelation clauses into your mortgage agreement, then go for it!
As an ex-Banking IT Contractor...
As an ex-Barcap contractor from way-back (and ex IT contractor in banking... gave it up to have a life), this type of move is par for the course if you work in banking. The idea is during the good times, when projects are on the go, salaries go up; but as an IT contractor you know, in the back of your mind, that once the bad times happen it will be your head/salary on the chopping block. You take the higher pay, you wear the risk.
I left after 20 years in the industry. It was fun, allowed me to buy my house, but now I find that having my life back and working a government contract much better. Hours are good, so instead of leaving the house at 06:30 and getting home after 2000 I actually get to see the kids. My initial drop in salary was 20-30%, but have been able to raise my wages by 4% each year over the last two years. This year my contract was renewed for 12 months and where I work we're doing a new project, so funding is good. Change of bosses is good, with the potential for greater moral fibre (in Banking people at my level were vetted for honesty and integrity so, I suppose, we wouldn't actually compete with the Banking executives for their positions).
All in all - I understand why the banks do it (easy savings); and I understand why banking IT contractors accept it (hard to get jobs this time of year, still a good salary, may be able to make it up with extra hours); but I'm very glad to be out of it.
It's a Free Market...
...so there's no obligation for their contractors to accept a rate cut. The talent will just leave and follow the money.
Things will get interesting for banks in January if there's even more churn if Permanent staff decide they are unhappy with the size of their annual bonus and then also decide to vote with their feet.
Cue more problems like we saw last week with HSBC, RBS and NatWest systems going down.
10% cut = 10% less work
Just rock up 48 minutes later than usual.
Oh dear how sad
Seems that people who work in companies like this are always pretty quick to slag off everyone else but when its their turn to come under the cosh, expect some sympathy.
That's the 3rd company I've heard about that had a finish date of 2nd December for contractors (all financial).
Obviously this makes sense to them as it is without doubt the worst time of the year to look for a new contract and they know this puts contractors under pressure to accept whatever sh!t they fling your way.
Personally I'd be looking now for a new contract and also trying to get a 1 week notice clause (if not already on this) on my renewal. That way I can accept and then just look in the new year on my terms not theirs.
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