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IT/product management contract, should I ask for rate increase at this point?

  • Last Updated:
  • Feb 20th, 2020 5:43 pm
[OP]
Member
User avatar
Oct 30, 2010
290 posts
48 upvotes
Toronto

IT/product management contract, should I ask for rate increase at this point?

I'm an IT/product management contractor working for a large client through an agency (not employed at the agency, just got my contract through them). My initial contract was for 18 months (which is unusually long, yes) and I'm nearing the end of it. The client has confirmed that they'll be extending the contract for another 12 months due to good performance and I play a key role in a large project. Is this a good time to ask for a rate increase?

  • Any rate discussions need to be handled by the agency (not myself directly with the manager) due to some policies. I'm not sure if this is a good thing or not
  • Not really looking for a huge increase since I doubt I'll get it anyways, just going by the standard rate increase most people get after X years for inflation purposes
  • I feel like I'm being underpaid (after talking to some friends in same role in other companies). However I'm not sure how much the agency is taking from me. If they're taking a huge cut then that would explain it
  • I'm not an industry veteran as I'm only a few years out of university. I'm probably the youngest person on the team with the least amount of years of experience, so that's where I feel I don't have much bargaining power
  • My performance has been great and I have great rapport with most people. There are always areas of improvement but it's mostly things I'd have to improve to advance in my career
  • I'm actively searching for other jobs, so far in a few interviews but no offers yet

Thanks.
7 replies
Deal Addict
Jan 1, 2017
1179 posts
1020 upvotes
What’s your current rate and what rate do you want to ask for? How many years of experience in product do you have?
Deal Addict
Jun 27, 2006
1463 posts
1603 upvotes
Toronto
Congrats on the extension.

Yes, this is your chance to ask. The agency that contracted you will need to review it internally and decide if they will give up some of their margin or go back to the client to ask for more money. Probably the latter. But this is not your issue.

Are you prepared to end the contract if they don't give you a rate increase? There is a certain amount of risk for them if you decided to end the contract as the replacement may not come from them. Just let them know that you believe the current market rate is higher than what you are getting. To be fair, the client may have driven the lower rate than what the market is generally asking for. It happens, some companies are known to pay less than average. Good luck.
[OP]
Member
User avatar
Oct 30, 2010
290 posts
48 upvotes
Toronto
maple1 wrote: Congrats on the extension.

Yes, this is your chance to ask. The agency that contracted you will need to review it internally and decide if they will give up some of their margin or go back to the client to ask for more money. Probably the latter. But this is not your issue.

Are you prepared to end the contract if they don't give you a rate increase? There is a certain amount of risk for them if you decided to end the contract as the replacement may not come from them. Just let them know that you believe the current market rate is higher than what you are getting. To be fair, the client may have driven the lower rate than what the market is generally asking for. It happens, some companies are known to pay less than average. Good luck.
So my agent was really unprofessional and got the contract written without even asking for my consent and claimed "a contract renewal did not require my signature", and had the audacity to tell my employer I was alright with the current rate (complete lie) despite clearly indicating I would like the agent to re-negotiate the rate. Now I'm worried if I'm asking for a rate increase my employer will think I'm the one "suddenly changing my mind" since they would think "I've already agreed to the current rate". I've already contacted the manager of my agent to voice this concern/complaint. Really flabbergasted at this. A contract renewal does not require my signature or consent? How does this make any sense? I think I really need to switch to another agent.
Deal Addict
Jun 27, 2006
1463 posts
1603 upvotes
Toronto
The contract renewal with the client is not your concern and you don't need to be involved in it. Your contract is with the agency and you may be mixing it up the two. The fact that they communicated with the client that you are ok with the rate is their problem as they didn't finalize the discussion with you.

As mentioned earlier, how firm are you with wanting an increase? Are you prepared to walk? I sure that this leaves a bad taste for you but put that aside and have the conversation about an increase. The paperwork generally follows after things are finalized..
Member
Sep 11, 2017
304 posts
206 upvotes
True story. My contract was approaching the end of its term but I was expecting to get renewed. 2 months before the end of the term, I instructed the agency to determine with the client if they wanted to renew me. 6 weeks later and the agency was still unable to get me an answer. I ended up just speaking with the leadership myself about their plans for my engagement and they ended up offering me a rate increase (I didn’t ask for one). Morale of the story, recruiters and agencies can’t always effectively connect with decision makers and certainly won’t proactively advocate for any raises on your behalf. Sometimes the ball is truly in your hands...
Deal Addict
Jan 31, 2007
3375 posts
680 upvotes
Ask the agency for a more $$ don't be afraid. You earned it. Never feel guilty. I have worked with agencies for long time and you need to do this, otherwise you will never get an raise and I am sure even your agency might ask this client for $$. The worst thing they could say no, and you agree to continue at the current rate.

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