Getting the rate you deserve – negotiating contract rates

Contractors who work in the IT sector were able to command some of the highest rates during 2018. According to data by ITjobswatch, in the six months up to 14th January 2019, the average day rate of an IT contractor was £500.

If you work in an area of IT where your skills are in high-demand, you can ask for higher rates. For example, a security adviser can look to earn on average £780 per day.

But what should you do if your ideal contract role is offering less than your day rate? Well, it’s time to negotiate. The success of your negotiation all depends on how you handle it. Here we discuss steps you can take to make sure you get the outcome you want:

Do your research

If you believe the rate on offer is below the industry average, go armed with evidence to prove it. Recruiters who work in your area of specialism will be able to tell you the average day rate. Of course, you have to factor in things like location and market need, so the rate on offer for a role in Leeds may differ to that of a similar role in London, for instance.

You can also find average day rates online. Job search sites like Indeed, Reed, Monster and Jobsite all have salary comparison tools.

Ask yourself if you’re worth the rate

When you go into a negotiation you have to be sure you are going into it on a strong footing. Otherwise, the client may find an excuse to refuse your request for a higher rate. So, make sure you have good references and the required skills and experience to be outstanding in the role.

If necessary, find the time to enrol on a course or two to refresh your knowledge and skills.

Be willing to compromise

It may be easier for the client to match what you are asking for if you are renegotiating a contract. But, if you’ve never worked for them before, the client may act cautiously. In both cases, it’s better for you to go in with a high offer and be willing to negotiate down to a level that you both find acceptable.

If this is a ‘dream role’ but the client is unable to budge on the day rate, ask for a clause to be included in your contract that a review of your day rate must be undertaken within a certain time period. A good time to do this is three to six months into the role as this is long enough for the client to measure your performance.

Keep your cool

Negotiating a rate increase can take time. It may be quicker if you are dealing directly with the client. But if you’re having to go through an agency you will have to factor in extra time as the agency will have to wait to hear back from the clients HR department.

Our advice is to stay patient and don’t rush the process as you may end up with less than you want. But if you feel the client is deliberately dragging their feet you may have to be prepared to walk away.

Asking for a higher day rate can be a daunting task, particularly if you’re relatively new to contracting. Don’t worry though, our free guide to contracting explains everything you need to know if you want to work as a contractor. Download your FREE copy here.