£80 per hour

[CouldItBeTrueBlue]

Am I being unreasonable to not understand how anyone can earn £80 per hour? Several people at our company have 'retired' then come back into roles where this is their hourly rate. I don't understand how this can be justified.

Maybe I'm being unreasonable.

How do you know that this is their hourly rate?

If people have specialist skills they might work as contractors on a day rate. If they come through a third party, e.g. a recruitment agency, there will be an agency mark up on top. So you might have mistaken what the individual is actually earning.

In any event, it’s about what your employer seems to be worth paying, isn’t it? Not what other people working in the business consider their colleagues to be worth.

They don't get paid holiday pay, sickness pay or get any other benefits. They also have to pay their own NI. The hourly rate compensates for that.

The market sets their rates. If they're not on PAYE they need to have a much higher hourly rate than as an employee, and it still costs the company less to hire them.

That has been basic business practice since... at least the 1980s if not before.

It is justified the same way the price of anything is justified, it is worth what somebody is prepared to pay.

That's what most decent tattooists charge.

I know people who earn £1800 a day, so well over £200 per hour (unfortunately not me!) Programming, innit?

The people employing them decide what they are worth. If you feel hard done by do the same thing or ask for a payrise.

Presumably they have in demand skills and there's a fairly small number of people who can do their job so it is more beneficial for the company to pay £80 per hour than not.

Many companies pay £500 + per hour plus for specialist legal advice - it's paying for the knowledge, experience and insurance.

Solicitors charging £200 per hour, dont know what they actually get out of that though

My hourly rate is £155 + VAT. I can absolutely assure you that I do not earn this.

I have a fixed salary barely above minimum wage. My clients pay for my skills, but my hourly rate pays for the salary of myself and another one/two people.

I know someone who left their salaried job, set himself up as a consultant and got hired by the same company (because he knows all the ins and outs) and charges them WAY more than £80 per hour, and only works 2 days a week for them. Smart move.

I have known IT contractors on £150 ph in Gov jobs before they got all got outsourced. One contractor got paid more than than the department director.

Some of them was well worth the wage. They paid for their own training, studied constantly be the best. Headed up roles in all but job title. Unfortunately they also made themselves indispensable due to never sharing knowledge. It's one of the major reasons why most Gov IT was outsourced

You’re not paying for their time, you’re paying for the years of training and experience to be able to give you the proper information / advice

There are billionaires in the world! There are heaps of people doing jack that earn more, that's just life!

Depends what they do doesn't it and if anyone else could do it cheaper.

@Meowtha I'm paying £120/hr for my guy, but he's phenomenal.

I used to charge £157/hr for my time in a previous life, but that was based on my time, administrative staff costs, IT costs, travel costs etc (travel time wasn't charged and it could be easily 6+hrs of travel in a day). I, sadly, was salaried so never saw that kind of money!

What @ShirleyPhallus says. Expertise, as well as overheads. By all means get someone cheaper and less experienced and see how long it takes them. It balances out.

They don't get paid holiday pay, sickness pay or get any other benefits. They also have to pay their own NI. The hourly rate compensates for that.

I'm freelance so all the above applies to me. I get more like £18 an hour.

What don't you get? It's a market. That appears to be the rate for that skill set. Presumably if they offered £20ph they wouldn't get people with the skills needed.

My brother got paid £800 per procedure and could do at least 6 in a day - weekends but still
FIL used to be a locum post retirement on 135 per hour, that was 10'years ago

Its expertise, need and capability they're paying for

My hourly rate is nowhere near £80 as a PAYE employee but if I took the plunge as a contractor (entirely possible) £500 a day is an industry average for my job and skills at a starting point. Not quite £80 an hour, but in a similar ballpark.

As others have said, contractors take on all the responsibility of tax, holidays, training, sick pay, pensions etc so still work out cheaper than employees on the books in many cases...although they do represent a risk in terms of keeping work close to their chests unless necessary.

It’s skills and demand based as people have said. I’d also add contractor rates are often misconstrued - there is no sick pay, holiday or any other benefits and sometimes people are not working 35-40 hours a week regularly and may have very short contracts. In addition to skills they are paid a premium for the flexibility in not having an permanent employee and all the costs around that.

It'll be interesting to see how IR35 changes impact. My rate works out around 70 an hour, but I'm miles cheaper for someone to employ directly than if they go to a consultancy firm to buy in those skills. Currently I'm outside of IR35, happy to take on the risk of insecure work etc. because I can manage my income via a limited company. The push to umbrellas for contractors means you keep all of the risk with none of the benefits.

It may sound like a lot from an hourly standpoint but there are plenty of people in a wide variety of fields who make well over £200K per year. It’s a combination of skill, education, experience, self-marketing, shrewd decision-making and a healthy portion of simple luck.

I used to place consultants in a well known company for £800 per day 20 years ago..so no it's not that unreasonable.