Being told that I can't have a raise because of contract restrictions

Question

I work at a large international company, but technically sent here as a contract worker for a 3rd party. Initially, this job was basic phone tech support. There is also a "second level" that they can promote employees to when there is an opening, but it's still very basic troubleshooting.

Two months ago I was about to be laid off with a lot of other people after 6 months working there, but interviewed and took a programming test for a programming position. On the last day of the two week notice that they had given me, I was told they wanted me to stay on for the new position. I was extremely excited because my goal was to eventually get my foot in the door for this type of work.

When I asked about a pay raise, they said they couldn't give me one because this is a brand new position that's not in the ongoing contract and I'm technically still first level. Eventually they decided to say I was second level for the $2 dollar raise. They always send a department wide email around when a new person is promoted too. So people are asking me in the halls, "aren't you the developer?" because they're surprised that I'm just now "second level", which means I've been making a first level salary for two months, and now still only making a second level salary. This is obviously embarrassing because it's like finding out your lawyer is being paid barely above minimum wage.

In reality, I'm not even at the low end of what an entry level developer would make in my city.

Is it possible that a contract like this couldn't be changed? I'm thinking about just doing the work for 6 months to a year, then applying to other jobs with my new experience.

Answer 1

Polish your CV and start looking for new opportunities. In IT industry with some skills and experience you will find a good job pretty quickly.

If you want to stay at your current company, I would recommend to prepare yourself first(list a points why you should get a raise) and discuss it with your manager.

Wish you all the best!

Answer 2

I would say this is a great opportunity for you to be able to get some experience as a developer, and to be able to put development experience on your resume. In fact, I would say that if your goal is to become a programmer, this may be your only practical path. It's hard enough to get a programming job if you already have experience; trying to get hired if you can only put technical support on your resume will probably not net you any offers for programming positions.

I was actually in the exact opposite position from you at one time. I was working as a developer and the company decided to lay off all their programmers and farm out the code to a company in India. They told me I was being "vertically transferred" to 3rd tier technical support. So I was supposed to do technical support for the rewrite. I told them I wasn't interested and got another job. I have never for a moment regretted it. It would have been a career-killer move.

My advice to you would be to not worry about the salary for now. The experience which you are getting is far more valuable, and will translate into a much bigger salary hike once you are able to cash it in on another programming job. Dig in and become a programmer. Learn new skills. Find out what languages and tools are "hot" right now and go through the tutorials. Then, once you have a year of that which you can put on your resume, hit the job boards and find something better.

Of course, you don't have to wait a year, but be cautious about your job search. If your current company puts you back on the termination list that you just escaped, you will have lost an opportunity that may never come again.

Answer 3

Terminology: You have the Client (the company where you are actually doing work) and you have the Shop (the company that employs you and rents you out to the Client).

You don't say who told you that you couldn't be given a raise because "the contract doesn't allow it", but I'd bet dollars to doughnuts it was the Client.

The Shop can't just unilaterally raise your rate, without approval from the Client. The Shop most certainly CAN ask the Client about raising your rate, given that your job description has changed to a MUCH higher level. The Client most certainly CAN ask the Shop to modify the contract to give you a higher rate, if they want to, and it is in the Shop's best interests to go along with the change. (There are two sub-possibilities: the Shop's fees on you stay the same, or the Shop's fees go up as your rate goes up. If their fee goes up when your rate goes up, they make MORE money off of you by getting you a better rate. Even if their fee DOESN'T change, by getting you the higher rate, they retain you and they keep making money off of you. They win either way.)

Talk to your Shop. Ask them to discuss raising your rate with the Client. Meanwhile, get the experience, and update your CV. It sounds to me as though the Client is taking advantage of an opportunity to get a Developer for the price of a second-level Tech Support guy, screwing the Tech Support guy in the process.

Oh, and another thing. When you talk with your Shop, point out that you are now doing a Developer's job, and, if they don't get anywhere with the Client on getting you a raise, ask them to consider moving you to a Client who needs Developers, as opposed to basic phone tech support. Their profit on a Developer is likely to be a lot higher than their profit on a basic phone jockey. (What you DON'T say, but is implicit, is that they are not the only Shop in town.)

Answer 4

"I'm a W2 employee, paid by X company, but I work daily at Y company. X company is just a staffing agency"

This needs to change.

You probably shouldn't push for it to change immediately because you don't want to risk losing the job. Ideally I think you should start exploring options with your manager somewhere between 3-6 months in the new role. Do this gently because you can't force your workplace to take you onto their books if they don't want to. If it becomes clear that you will never make the transition then obviously you will need to find a new job at some point.

The reason the current arrangement needs to change in the long term is that your current staffing agency sounds like it is set up to deliver cheap labour and NOT set up to hire out skilled developers. This means that they are not well placed to negotiate a good rate for you and will not be able to find you suitable replacement work if your current workplace decides to stop hiring you. In other words, there are no benefits to you staying with them once you are established as a developer in your current workplace.