Going from contract to perm? How much?

[Pinko1]

I'm inside IR35 and have been working in the same place for 5 years now at a lowish rate. They are dangling a permanent role but have asked for my package expectations. I know what they are paying my agency. How can I work out what I should be getting roughly as a permanent member of staff so I can negotiate better? I don't want to undersell myself.

I wouldn't be giving a number, I would respond with something along the lines that you would need to see the full package to assess it.

@SeparatedAndFree thank you. Ideally id like a rough guide to work it out. I know I'm very much needed here.

i did this. I looked at the market for similar jobs, and factored in pension, etc, and other bens you get as a permanent member of staff rather than contractor. We negotiated and agreed somewhere in the middle.

Can you find out the salary for the same position in similar companies?

I went contract to perm earlier this year. The offered salary was lower than I would have preferred but it was an excellent benefits package so I accepted.

Have you detailed what you currently get now? I included things I paid for that I wouldn't as part of my new package.

I spoke to several agencies who I know well so effectively the rate the agency currency gets from my role now is actually what id be pitched at. So I guess what I want my company to pay me is what they are currently paying the agency plus pension and bonus

Your expectations don't sound very realistic. You want them to pay you the equivalent of a contractor's rate and then pension and bonus (and I assume holidays) on top? Nice try. 😂

I recently went from contract to perm with the same company - salary is 75% of day rate equivalent but obviously I now benefit from pension/bonus/above average holiday pay and other perks.
Id pitch it around there

Contractors are paid more because they don't get pension, annual leave, sick leave etc.

I think you might be expecting too much.

Hi, so just to be clear, my agencies are pitching perm roles at that level to me. I'm basically underpaid where I am now even as a contractor.

@user628468523532453 that's the thing, I'm not paid more as a contractor. I took this job to pay the bills and didn't negotiate well

You won't get the agency rate, same as if you were a supply teacher, you wouldn't get supply salary for permanent teacher role. You need to find equivalent perm jobs that compare to yours and start with that sort of salary as a negotiation.

Contractor to perm is always a hefty pay drop because you don't get pension, paid holiday or paid sick leave or job security. You should have negotiated a better contractor rate for yourself when you had been working there for a few years. Sometimes there are perks that work out better than salary like number of days holiday, pension contributions, private health care etc.

Oh I see. That's a bit tricky then within the same organisation. I'm not sure what to suggest tbh.

@user628468523532453 yes, my logic is they got me at a discount so now need to pay what I'm worth. The alternative is I keep contracting, they pay the agency the high amount, me low. Or I leave.

@trunkler but my logic is equivalent perm roles are the same as what the agency is being paid for me. If I wanted an appropriate contract role, I'd need to go way higher too.

Then argue for that salary then and if you can show equivalents then the better.

Don’t listen to half the nonsense on here.. you should be paid the market rate for your role, regardless of how little youre being paid right now. Always go in higher than you’re expecting cos they’ll always try to knock you down. Never failed for me or many of my peers, and I have been a contractor turned perm on multiple occasions

know your worth and value !

I think your logic is probably flawed, especially from the employer's perspective. You seem to be seeing your cost as your rate (A) plus the agency fee (B) and saying that's why you want A + B = C to be your permanent salary. But for your employer, the cost of a perm staff member is significantly more than the equivalent of C as they have the additional cost of overheads D (hols, sick leave, training, pension, NI, etc) for perm staff which can increase the employer's cost by up to 1.7 times the cost of their basic salary. You may be asking for C but it will cost them D. Why would they pay D when they can carry on paying C instead?

Most employers convert a contractor to perm to save money. Instead it seems you will be asking them to increase the cost to them significantly. Do you not see this?

If it's an IT role there is a website called ITJobswatch which does salary bench marking for the UK for just about every type of software role you can think for both contracts and perm so you could pick the median salary for your role from there as a starting pount.

@HundredMilesAnHour that's a really good point. I'm only really setting my salary by the perm levels I'm being shown. It just so happens it equates to the rate being paid to the agency. But you're right, why should they make me perm if I'm cheaper as a contractor. How can I make this work?