As a contractor taking on more responsibility, who do I talk to about getting a raise?

Question

I work for a small-ish contracting agency, working on the systems of a much larger corporation. While I was hired as an entry-level QA, my role has since shifted to being more of a data analyst and engineer. Since taking the lead on a few projects, and all the stress that comes with it, i've started to question if I'm really getting a fair deal.

Eventually I'd like to work for said Corporate company, much in the same capacity that I serve in my current contractor role. My Corporate boss has been very happy with my work, and consistently compliments my progress and the work I'm doing. The issue is, I'm still making an entry-level QA salary, while taking on the responsibilities of leading new projects, and data analytics.

I've maybe met my bosses and co-workers (outside of the ones with me at Corporation) once, but I'm not sure who to go to about getting a raise, or atleast re-evaluating my current situation. The only contact points I have are with a person in our HR department, who hired me, and the person I report to for my time billed.

As of right now, leaving my role in Corporation is not an option for me.

Answer 1

The time to discuss this was when you took on more responsibility, not when you realize, "Hey, I should be making more money."

Don't talk to the client company, you're a contractor. You need to talk to the company who pays you.

If you had a recruiter when you started at that company, start with them since they should be a point of contact, even if they haven't been. Heck, I haven't talked to my recruiter in many months, but he's still my recruiter.. But since you don't have an actual point of contact, don't start with HR. That won't help. You may need to talk to the account manager who handles your client company. The reason is because they'll need to discuss more money with your client company. The HR person can at least likely give you that information (who the account manager is). If not, you can ask your manager at your client company, i.e. "Who do you talk to when you're dealing with [employer name]?

Here's what you need to expect though. The account manager will resist and the company will say absolutely not because they have a contract too.

You have 2 problems:

1. You're not willing to quit to force a renegotiation
2. You're already doing the work that should get you a higher wage.

I feel your pain. I've been a contractor for many, many years. I've been on my current contract for over 2 years at the same wage. The reality is that when you're contracting, you almost always have to go somewhere else to get more money because it forces your employer to ask their client for more money. Companies look to save money, not have to pay more for something they're already getting. Additionally, if your employer were to give in, it could set a horrible precedent that would have other contractors asking for more money and if they acquiesce, they could very well lose the client altogether at their next negotiation.

Answer 2

It seems to me that you have two possibly conflicting goals: one being a short-term goal while the other is a long term objective and each has its own route to success. Based on your question, you want to:

• Increase your current pay (short-term goal)
• Become hired directly by the placement company (long-term goal)

So let's take them one at a time:

1. What do you do as a contractor when your role changes?

If you are a contractor then you are not paid directly by the placement company but rather through a second party contracting company. That contracting company (Party 1) creates a contract with the placement company (Party 2) to fulfill certain work for a specific amount of money (Contract A). They then go out to the market and find you (Party 3) and create a second contract to fulfill said work (Contract B). Note that the pay rate in Contract A will never equal Contract B... the contracting company makes it's money by ensuring the rate of Contract B is smaller.

Depending on the relationship between the contracting company and the placement company, a change in role could constitute as a violation of one or both contracts above and require an amendment to those agreements. Most certainly if you were hired with the expectation that you would perform work at a specific rate and are now being asked to perform work that is worth more, one of the three parties above is making out like a bandit while one or both others are left in the lurch.

How to handle this dilemma could become slightly political, however, as your interests will often not be in line with either the contracting company or placement company.

If increasing your immediate pay is you number one focus, your best bet will be to discuss with your contracting company the change in your duties. They will then likely renegotiate Contract A which will then give them leeway to increase the money you are making in Contract B. Depending on the placement company, however, this could possibly rub their HR department the wrong way (after all you are now costing them more money). I probably wouldn't let that prevent me from having this conversation though as for all you know that renegotiation of Contract A has already taken place and you are the one currently in the losing position.

2. How do you move towards being hired by your placement company?

If you want to move towards being hired by the placement company you need to very much impress them with your work (which it sounds like you are doing). You also have to develop good relationships with the placement company managers, express your desire to become a direct hire and be somewhat fortunate (read: dumb luck) that opportunities in department finances will turn in your favor.

In the meantime, however, grab up as much work as you can stomach. The best way to show that you are invaluable is to make yourself invaluable. That assumption of extra work builds up your reputation and ultimately that reputation is what will get you hired on full time.

Depending on your relationship with your placement company manager, you might also consider having a conversation about your future goals and desire to increase your responsibilities and pay. There is nothing wrong with expressing the desire to move upward and to pursue greater opportunities. If worded correctly you can show yourself to be ambitious (which is a very desirable thing in a company). This conversation can also have the affect of lighting a fire under a hiring manager as if you have truly made yourself valuable they may extend an offer simply to avoid losing you.

One last thing to keep in mind is that most contracting companies include in their contracts (Contract A) with the placement company something called a "buy out clause". This defines an additional cost for a placement company to buy out a contractors contract (Contract B) and directly hire them. You may want to review your current contracting company's policies to determine how large this cost is as it could play a role in any negotiations you hold.

Summary

At the end of the day how best to play this one out will depend on both the contracting company and the placement company. I would probably recommend a professional approach: work as hard as you can, build up your reputation and talk to the managers of both companies and be up-front with your career and salary goals.

Answer 3

Is the scope of the work to be performed outlined in the contract? If you are completing assignments that are outside the scope that is detailed in the contract, you may have some leverage to renegotiate. Is there any language in the contract that talks about an escape clause, or explicit options for renegotiation?

If a renegotiation is appropriate, talk with your contracting agency before you try to go it alone with the client.

Answer 4

Talk to the HR Rep who hired you. At some point you may also want to go to your corporate boss and express your interest in joining the company (assuming you haven't already done so.)

Answer 5

As a self employed contractor when it comes time to renew you contract is the time to increase your day rate.

Or are you working for a body shop its your "employer" you need to ask about getting a raise if you are doing work above your pay grade I would assume they would be keen to increase the rate you are charged out at.