When IT contractors should quit

It’s not often in the last few years that IT contractors, the UK’s best-paid IT staff, have been forced to seriously consider whether to ditch their contracts for services.Even if contractors could bring themselves to ponder ‘resignation’ – a process more befitting permanent staff, the smell of other contracts over the hill would make it a quick decision.But these are changing times: still reeling this month from the credit crunch, six City banks told IT contractors to choose between pay cuts of up to 11% or immediate termination. In a separate but high-profile aside that followed, a bullish shadow home secretary, David Davis, demonstrated it was right to stand by your principles at work by taking the rare decision to quit as an MP. Despite one IT contractor sounding like the Tory MP by going on the offensive, saying the decision of his client, RBS, to cut his pay was “appalling,” he declined a speedy exit from the bank. “I disagree entirely with the contractor...who states that RBS’s approach is ‘truly appalling’,” blasted Steve Pragnell, a practicing IT consultant with 15 years' IT contracting under his belt.“The fact is RBS exists to make money, times are hard and the inevitable cost cutting is taking place. If such an attitude is detected on-site, it is entirely feasible that the contractor will not be offered back”.Rather than quitting when the IT jobs market is “truly awful,” he said contractors should use pay cuts as a chip to bargain for recompense for future cuts or better terms and work.“Contractors have to accept that rate is our primary weapon in the bad times,” said Mr Pragnell, who is the managing director of PM3, an IT project manager supplier.“Domain experience is extremely important, qualifications add a little weight but ultimately the first criterion clients are judging CVs by right now, is rate. “This is a simple case of supply and demand. The successful contractors that retain work throughout this downturn will be those that are flexible and willing to accept that even a 25% rate reduction is preferable to sitting at home waiting for the phone to ring.” But other areas of their work, other than the headline rate, which pre-credit crunch surveys have shown is a lesser priority, are causing contractors to consider their positions.“The most common reason for quitting a contract is probably late payment,” said John Kell, a policy officer at the Professional Contractors Group.“The key message is not to let a late payment slide - when that becomes a matter for walking out is, however, down to the individual contractor.”The problem of delayed payment is now so prolific that the PCG has issued fresh guidance on what to do if an agency or client is late paying or has become insolvent .Besides pay, concerns about unfair or restrictive clauses and worries about the MSC and IR35 tax laws are factors that typically motivate contractors to refuse a contract.“[But] I've never heard any great concern expressed by contractors about those [a client’s global development and corporate ethics],” Mr Kell added.“As for when contractors should consider quitting, that's a commercial consideration and really depends on personal circumstances.”Personal circumstances were the most important criterion for William Knight, a monthly columnist for CUK, who was forced to consider pulling out of his former job as a contract software developer.“In 18 years as an IT contractor I never had cause to quit a contract mid-term. That's not to say there weren't times when I considered it,” he said.“In one contract [I had] ‘a perfect storm’ of personal tragedy - my seven-year-old nephew died and then my father followed soon after- and stressful working conditions-… led me to consider leaving. Yet I still stuck it out, and eventually conditions improved.”If a situation is becoming too stressful, sooner rather than later the contractor needs to decide to quit or stay; though making the right choice is not easy, said Derrick Cameron, the managing director of IT-business consultancy Eximium Ltd .“When I worked as a freelance IT consultant, I was less inclined to walk away from a project just because I didn't like it.“I always felt that reputation was everything, and didn't want to burn any bridges, upset my customer or create the wrong impression amongst colleagues,” he said. “Of course, the crux of the matter is that if you don't truly believe in what you’re doing, you may actually be sacrificing quality of service and creating a poor impression.” For most IT contractors, Cameron said their quandary is whether to fulfil their contract and “go along with things as they are”, or listen to their instincts, speak out and potentially vote with their feet.“The act of resigning itself can be a positive move, acting as a proactive force and a catalyst for change,” he said. “It may even force a change of direction from management. On the other hand, are you simply taking the easy way out rather than making the effort to effect change from within?”Having weighed up the pros and cons of quitting, Cameron believes all IT contractors should pose themselves five key questions before deciding either way.
1. Does the situation compromise either your core values or your belief system?
2. How bad is it really going to be if you just put up with what's going on?
3. If you walk away, what are the implications for colleagues and the project itself?
4. Does being involved in the project cause you more grief than leaving it?
5. Is resigning defensible – and can you justify it to future customers or employers as doing the right thing?
But as Mr Davis is finding out, particularly from some of his critics, ‘doing the right thing’ isn’t always easy, not least because it normally involves personal and professional sacrifices.“However, the ability to feel pride and satisfaction in what you do is an important part of any job – whatever role you may have,” Mr Cameron countered.“For me, the message is clear: if you aim to stay true to your professional and personal principles, sometimes you have to take the more difficult path - and challenge the status quo.”But sometimes, like when the jobs market is not afloat with opportunities, it may be just as advisable to sit out the fight and see out the contract.“The joy of IT contracting is that bad contracts come to an end, usually after just three or six months, and you are free to leave without terminating the contract or soiling your reputation,” said Mr Knight.“I would recommend not signing up to more than three months at a time if the client is questionable, and your conduct as a professional should mean the trivial personal and political worries that plague ‘permie’ jobs do not unduly affect your mental health. Always remember your contract has an end date. You are not permanent!”

Article from Contractor UK.

Council staff vote to strike over pay

Council workers are to mount the most serious challenge to the government’s pleas for pay restraint after voting on Monday to stage a series of summer strikes.
The decision by local government workers in England and Wales to back the call for action comes less than a week after Alistair Darling, the chancellor, appealed to workers to curb demands to help combat rising inflation.
More than 600,000 members of Unison, the largest public sector union, were balloted after rejecting a 2.45 per cent pay offer. The union is demanding rises of 6 per cent or 50p an hour, whichever is greater.
Its members include care workers, housing benefit officers, teaching assistants, dinner ladies, cooks, cleaners and refuse collectors. Local government employers warned that “some of the most vulnerable people in society” would suffer if the council workers went on strike.
Unison said that members had voted by 55 per cent to 45 per cent in favour of “sustained industrial action” on a 27 per cent turn-out. Brian Baldwin, chair of the employers’ negotiating body, said this meant that only 13 per cent of the membership had voted in favour of striking.
He warned that councils would “be forced into making unpalatable choices between cutting frontline services and laying off staff” if they approved a bigger increase.
The union’s negotiating team will decide today what action to recommend to its national strike committee, which meets on Friday. The most likely outcome, say officials, is a series of short strikes starting with a two-day stoppage next month.
Dave Prentis, Unison general secretary, said: “This is a . . . clear message to the local government employers that our members are willing to fight for a decent pay rise. They are fed up and angry that they are expected to accept pay cut after pay cut, while bread and butter prices go through the roof.
“Most of them are low-paid workers, who are hit hardest by food and fuel price hikes, and they see the unfairness of boardroom bonanzas and big City bonuses.”
Civil servants and teachers have already staged a series of one and two-day strikes this year over the government’s insistence that public sector pay rises must be kept in line with its 2 per cent inflation target as measured by the consumer price index.
David Cameron, the Conservative leader, sought to add to Labour’s discomfort yesterday by claiming that the cash-strapped party was reliant on union funds and would find it difficult to take a tough line against council and other public sector workers. “I certainly hope there won’t be a series of strikes. Strikes very rarely achieve their goals . . . the Government is going to have to be extremely tough about this . . . to make sure we don’t have a wave of public strikes,” Mr Cameron said at his monthly press conference.
A Downing Street spokesman said Gordon Brown, the prime minister, was “disappointed’’ Unison had decided “to take this action” but insisted the pay negotiations were “really something for local government and the trade unions”.

Article from the Financial Times website.

How to ask for a pay rise ... and get it

WITH pay review season on the horizon, and the cost of living skyrocketing, it's the time of year when workers are thinking about how to boost their bottom line.

Show me the money

Career coach Jane Lowder, founder and senior coach of Max Coaching, said employees should prepare themselves thoroughly before pitching for a pay rise by researching what the market rates are for your position, and proving your value to the company. One of the worst examples Ms Lowder had heard was of an employee barging into their manager's office and proclaiming: "I've been here for a long time, I deserve a pay rise". "And the manager's response was: 'What have you contributed?’" Ms Lowder said. "It's not just based on longevity; it's not just about turning up every day." She said preparation is crucial to getting what you're after. "It really revolves around proving your contribution to the organisation," she said. "Obviously the best way is to consider how you might add monetary value or impact the bottom line." With a widely acknowledged skills shortage, keeping your employees happy is crucial for bosses. A third of more than 11,000 respondents in the CareerOne survey said they would quit their job if they didn't get the pay rise they wanted. Keep your emotions out of it Breaking down into tears and making an overly emotional plea for cash won't help your chances, Ms Lowder says. "Keep it as a business discussion or transaction. Getting emotional doesn't always carry over that well," she said. Being demanding, or threatening to quit if you don't get what you want won't win you any brownie points either. "Holding the organisation to ransom is not a good idea," she said. "If you do decide to leave, then there's a reputation that follows you...one of being very demanding." Keeping an open mind and conducting a two-way conversation rather than a demand will also boost your chances, Ms Lowder says. Discussing what else you can do to contribute to the company will also help, but make sure you time the talk appropriately. If your manager's under the pump or trying to meet a deadline, make sure you have arrange a suitable time to for a detailed chat. "If the organisation's just posted results that weren't as favourable as they'd hoped, or if they haven't met targets, (it's) probably not the best time to be talking pay rises," Ms Lowder said, adding there are plenty of other ways for bosses can keep workers happy besides a pay rise. "Research shows that it's not just money that will keep people in an organisation. "There's an awful lot more incentives they can offer for retention." These include gym memberships, subsidising private health insurance, or offering flexible working hours and the option to work from home. Check out the competition Being realistic in your expectations is important, she says. By researching the market and seeing what the market rates are for your role using a salary survey, you are more likely to be clear on what to expect. "You need to suss out the market and be aware of how many opportunities there are out there for you as alternatives. "Again it comes down to 'do you have a niche skill and is it in high demand?' And if so, that impacts on your ability to ask for more."

Pay review checklist

• Prove your value
• Use evidence to boost your case
• Don't hold the company to ransom
• Keep emotions out of it
• Keep an open mind
• Timing is important
• Research the market

*Article from http://www.news.com.au

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