Contract Employment 101

Tips on locating and hiring a Professional Contract Consultant who can actually do the job
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How placement agencies work (or how they are supposed to work):  Account Managers work hard to develop relationships of trust with client companies and to obtain job orders from their Clients. Placement agencies make their money by getting their Clients to hire Candidates that they represent. If an agency does not fill a job order, or worse yet, if a competitor fills their job order, a lot of time and money is wasted and it's another lost opportunity. Fail to fill enough job orders and everyone working at that particular agency is going to eventually need their own Recruiter....

So you'd think that Placement Agencies would be eager to make contact with experienced, qualified Engineers who have a long history of successfully completing engineering projects, right?   .. and that they would treat these money making resources with the utmost courtesy and respect, right?   Yes, you would think so, wouldn't you? Sadly, this process often breaks down during the recruiting phase where poorly paid, untrained "Recruiters" (who were selling refrigerators at Best Buy last week) disregard, insult and chase away Engineers who could be racking up major billable hours for their company.

Why I put this page up here:   It's tiring being jacked around by "Recruiters". It's tiring being required to jump through hoop after hoop after hoop for jobs that "disappear" at some point along the process. It's tiring being rejected for jobs I could do in my sleep and be told "while your credentials are impressive, we want to pursue applicants who more closely meet our requirements". I am way past tired of people who are younger than my Grandchildren demanding references so that I can be considered for a project that I was an expert at before they were even born.

Interestingly enough.... I sometimes have occasion to hire people for various projects that I get involved with. These same agencies who have treated me shamelessly in the past can't seem to understand why I am not interested in engaging their "services" to fill my hiring needs.

What goes around, comes around.....

If anything here offends you:   Just consider the information here to be customer feedback. If all you care about is placing desperate, unemployed people who are willing to work for way below market wages while you charge the client top dollar for his time .... and then take 60+% for yourself for doing essentially nothing, then by all means, continue doing what you are doing.

So you have an employment opportunity?:  If you think that dangling the possibility of employment over hundreds of candidate hopefuls entitles you to be arrogant and disrespectful towards those appying, you are probably beyond redemption. In case you are suffering from an identity crisis, your purpose in life is to find and place workers who will generate income for your company. Every time you blow off a qualified candidate, you have failed to perform your primary mission.

Why so few of my projects come through agengies anymore:
- Step one: You are presented with an unrealistically long list of required skills and experience that an MIT PhD with 30 years of experience couldn't meet.
- Step two: The compensation for this so-called opportunity is typically far lower than what a Technician without all of those qualifications could earn in the local market.
- Step three: The "candidate" will be asked to jump through hoop after hoop after hoop in order to be considered for this "opportunity".
- Step four: Invariably, even if you are able to meet most of these skills "requirements" and if you are willing to endure the "Recruiter's" extremely painful recruitment process, you will never actually get to interview for this "opportunity".
- Summary: If you have an actual job that pays a fair wage, working at a company where I will be treated fairly and with respect, I would love to hear from you. But... am I willing to eat shit and be treated disrespectfully just to be considered for an "opportunity" that doesn't even exist? Not likely.....

Moronic "Recruiter" Questionnaires:   "Recruiter" questionnaire asks: Are you eligible to work in the USA?

Read my resume, fool! I am a US Military Veteran. All US Military Veterans are US Citizens and thus can legally work in the USA!

If you are too lazy to actually read my resume, then I am too lazy to fill out and return your bullshit questionnaire. If you can't tell the difference between an experienced USA-born, degreed Engineer and some zero experience Green Card holder from Bombay, you are probably in the wrong business. Is your time so much more valuable than mine that you can't take ten seconds to actually read my resume?

If you have to obtain answers to vitally important (to you), but inane (to the rest of the World) questions such as: "What do you feel are your top three strengths?" or "Have you ever worked on contract before?" before you will be willing to "submit my resume" (whatever that might mean), you can save us both a lot of wasted time and go play these games with someone else.

If any of this offends you... well, you can cry about it to the owner of the used car lot where you will probably be working next week. I get a pile of e-mail every month from Consultants all over the World who read this page and write to tell me RIGHT ON! Dealing with "Recruiters" who pull this kind of crap is a total waste of time.

If your objective is not to put a qualified Engineer on a project so that they can earn revenue for your company, go bother someone else.

Off Shore Agencies:  If you are a Recruiter in India or somewhere other than the USA, please click HERE

So-called "Great Opportunities": Please do not contact Consultants with a "great opportunity" and then ask them to spend the next week convincing you that he/she is qualified to take on the project.

I am not in the recruiting business: Please do not contact Consultants with a "great opportunity" and then ask them if they know someone who might be interested. Even if we did, We would not refer them to a cold caller.

Resume Mills: I do not work with resume mills. If your idea of "submitting someone" is to FAX their resume to the client along with a heap of other resumes, you work for a resume mill.

Open Rates: There is no such thing as an "open rate". Clients that have approved, budgeted projects always have rate expectations and ceilings. Please do not waste a Consultant's time if you are just snooping around trying to find out the going rate for a particular skill set.

Projects that are doomed to fail: I do not take on projects that are unlikely to be successful. If finding a Tech who will work cheap is your primary goal, I am most certainly not the Consultant for you. I have been doing this type of work for a very long time. The success of your project will be assured if I am working on it. Project success ought to be the Hiring Manager's primary concern. If it isn't, please don't waste my time. If your project is significantly under-funded, perhaps you should be rethinking your budget and design requirements. You just spent $Millions on hardware or software and now you want to find the least expensive and least experienced Tech to deploy it for you? Good luck with that!

Out of Town projects: Out of Town projects involve travel and living expenses for the Consultant. If you are offering less than the market value for a Consultant's time PLUS expecting him to travel to the site, live in a hotel 7 days a week, rent a car and so forth, you really need to find a different career because you are never going to make it as a "Recruiter".

Checking a Consultant's availability: Please do not waste a Consultant's time checking his rates, availability and so on unless you have an actual, approved, funded project that you are ready to begin in the next week or two.

What's the best number to call so that we can talk?: See above. I do not invest my time in phone conversations with "Recruiters" unless they are willing to provide me with the name of the Client, job site location, the rate being offered, the estimated project duration and a general description of the project scope and objectives. Agencies that are experienced in dealing with professional Consultants will provide this information in their introductory e-mail, without being asked.

The "Recruiting" search process: Most recruiters don't do more than Google a keyword search before calling you. And they will customarily take upwards of 40 to 50 percent of the revenue a Consultant bills for this gargantuan effort. The real job requirements will not be known until contact is made with the hiring manager -- earlier the better. If the "Recruiter" wants to avoid that, he is probably just collecting information and adding to his resume database for future reference. These facts are the main reason why I rarely deal with "Recruiters" anymore.

Submittal Deadlines: Some Recruiters try to create a false sense of urgency by claiming that the cut off for resume submissions to the Client is a couple of hours from now. This may have worked great at the car dealership where they were working last week but in the job placement biz, legitimate hiring reqs are almost always open until filled.

Contract to perm:  If you are a hiring manager doing a "contract to perm" recruitment, a contract consultant is most certainly not for you.  What you really want is a so-called permanent "full time" employee that you can test drive for a few Months to make sure they can do the job before you take them on as "permanent" employees, right?  Take my advice: be honest with yourself and with the candidate.  If you want to recruit a "full time" Employee, recruit a full time Employee. 

Free consultations: Professional Consultants are not in the free consultation business. I do not do free on-site or telephone consultations so that you can avoid making major mistakes when you try to handle your project on your own. If you are looking for free advice, please waste someone else's time.

Required candidate skills: Be realistic with your "must have" skills list.  If all you need is someone to do Microsoft Windows desktop support, don't have a skills requirement list that even a PhD with 25 years of experience could not meet. 

More on required skills lists: Acquiring skills costs money and having those skills is valuable.  If the job requires extensive experience, high levels of training and certification on specific products and so on, expect to pay for it. If you are offering a disproportionately low pay rate compared to your required skills list, expect to be disappointed with the quality of the candidates who actually respond.

Skills assessment lists: I don't know who thought these things were a good idea but they seem to be picking up popularity especially with resume mills. Here's how they work: The Candidate is asked to check off their years of experience and proficiency level for a list of hardware, software and other items. Typically, the lower the pay rate, the longer the list. Needless to say, being a bigger liar than the other guy is the way to win at this game. Personally, if some Recruiter looks at my decades of UNIX Systems Engineering experience and has to ask how many years of experience I have with vi, I figure s/he is too much of an idiot for me to be wasting my time with. One exceptionally ditzy Recruiter looked at my 30 years of UNIX exerience and wanted to know how many years of experience I had with cron, since this was a major client requirement. Duhhhhh.... If a "recruiter" can't just look at a resume and figure out if someone is at least somewhat qualified for a particular position, they are probably in the wrong occupation. Just what are these resume mills doing to justify their fee, anyway? In any case, if you are too busy to actually read my resume, I am too busy to fill out your bullshit form.

Moron Recruiters - You know you are dealing with a moron when the conversation goes something like this:

You: I'm responding to your e-mail regarding a 3 month project in "pick_a_City_2,000_miles_away_from_home".

Recruiter: Do you have experience with WhizBang Plus Version 7.31?

You: Yes, I've worked with WhizBang Plus a lot since it was released 10 years ago.

Recruiter: What about version 7.31?

You: I've worked extensively with Version 7.30 and earlier. 7.31 has only been released for a few weeks and I haven't had a chance to see it yet.

Recruiter: Sorry. The Client is insistent that he wants an expert with at least 2 years of experience with 7.31

You: But.... well, what does the job pay? Maybe I could attend the $5,000 one week Vendor training update for 7.31

Recruiter: The rate is "open" and tops out at around $15 per hour on a 1099.

Temporary employment or a contract consultant?: Just because someone bids on a contract consultant project does not mean that they are a professional contractor.  There are a whole lot of inexperienced, unemployed Techs out there calling themselves "Consultants".  A five minute conversation with them discussing some of their previous consulting projects will shed some light on their credibility (or lack of it).  There are also a lot of folks out there calling themselves "Engineers" who (IMO) are really Technicians or less.  Specifically, attending a one week seminar and passing the Microsoft MCSE test does not make one a "Network Engineer".  A four year Engineering degree and several years of apprenticeship as a Technician is the road to being a credible Engineer.  Very few "real" Engineers are younger than late 20's, IMO.

Overqualified Consultants:  There is no such thing as a contract consultant who is "overqualified".  True, you may not need my expertise with DEC PDP-11 or RSX11M since the only place you are likely to see that equipment is in a museum.  But the fact that I worked on PDP-11s when they were brand new and the hottest thing around and then saw them through their entire life cycle brings value to your project that a less experienced contractor won't have.  Ditto for arcnet, Banyan, X.25, Bisync, HASP, SDLC and a pile of other stuff that I learned when it was new and worked with until it went the way of the moose.  There are huge differences between the various contractors who will bid on your job.  But consulting is still a fairly competitive business. Chances are that an "overqualified" consultant may not be any more expensive than the other guy who may not even know what a transistor was used for. 

Getting the job done right or finding someone cheap: It makes sense (at least to me) that a hiring manager's number one concern in locating a contract consultant is that the job gets done right, right?  Otherwise, why bother?  Yet an amazing number of managers choose a consultant based on the rate they are willing to work for rather than their ability to bring the project to a successful conclusion.  Contracting is a very freelance business and there are a lot of hacks out there.  The less you as a hiring manager knows about the technical aspects of what needs to be done, the more vulnerable you are to these guys.  I have personally made a lot of money taking over projects that were botched by someone else.  I can assure you that the guy who hired me was not pleased about the lost time, project delay and wasted money, especially if the first thing I have to do is scrap all of the "work" that the "bargain" he hired did.  In retrospect, his decision to save $10 per hour with this other guy was pretty idiotic.

Our Company always pays less than the market rate:...ostensibly because it's an honor to work at this particular company and they are doing you a favor by hiring you. Or because being able to say that you worked there somehow has value on your resume. If this works, more power to you. Personally, I think you get what you pay for and even if you are able to attract competent people at low pay, chances are they will bail the minute they get a better offer from someone else. If the high cost of turnover concerns you, pay people you recruit what their time and skills are worth.

High Contractor rates do not guarantee competency: I know a guy in this market who gets $180 for his time doing Openview development that I would be very happy to do for a whole lot less.  In all modesty, there are less than a dozen consultants in the USA who have my level of expertise with NOC design and development and this guy is not one of them.  Sure, after a couple of months it becomes obvious that the guy isn't up to the task, but at $180 per hour, that's a $30k per Month mistake!

More about skills:  Most contract consultants get their training the same way that I do... on the job.  I work with all flavors of UNIX, various versions of Windows and Windows products, a half dozen or so remote management applications and a pile of other stuff... have a look at my resume.  And having Sun Solaris (for example) listed doesn't mean that I just know how to log on.  I know how to Administer them!  Expecting a contractor to be an expert at the latest rev of pick_your_favorite_ product is a little unreasonable, in my opinion.  In fact, if I spend a substantial amount of time working in a Solaris environment (for example), I go out of my way to land a contract working in a different environment next time.  As a professional contract consultant, I cannot afford to get too focused or specialized with just a handful of products.  If that's really what you need, pay a VAR $250 an hour!  In the vast majority of projects that I have bid on, my ability to pick up new technologies quickly (and without formal training) makes my cost savings to the client worthwhile.  Most successful contract consultants who have been at this for a while have this same ability.  In my case, I actually charge more per hour for jobs where I won't be learning much.  I'll usually give a client a very attractive rate for a project where I will be learning a lot of new stuff.

A word about recruiters: There used to be a lot of professional recruiting firms around who would understand your recruitment needs and would go on a focused search to find you the exact skill set you were looking for.  Due partly to the bad economy, most of those companies are long gone.  Their fees could be pricey but if getting the project done right was important and you didn't happen to have the time or resources to locate a good consultant yourself, these agencies could be a good bet.  What's left now are mostly resume mills and "recruiters" who were selling appliances at Best Buy last week.  If you're Agency's idea of "doing a search" is to fax you over stacks of resumes for every unemployed dork in Town, you need to rethink your strategy.  These days, all these "Recruiters" do is run a google search for resumes with specific keywords in them when they get your job order. Or post an ad on Monster, Dice, Craiglist or a similar site. You can certainly do the same thing and save yourself a stack of money in the process.

Off Shore "Recruiters":   I get a fair number of e-mails and calls each week from "Recruiters" from far away US area codes. I've learned over time that these numbers VoIP forward to people in the former Soviet Union, India or other former crown colonies. Needless to say, these "Recruiters" know nothing about the local market and in most cases don't know a server from a spatula. What they do have in common are arm's length skills and experience requirements for jobs that pay way, way, way below market value. In my opinion, any employer who is using Third World Country Agencies to find Candidates is probably not very likely to be willing to pay anything close to market value for their time. Anyone who thinks that qualified NOC Architects will be lining up to live in a hotel thousands of miles away from home (at their own expense) for $60 per hour deserve the kind of people they will attract.

My rates:  I prefer to work W2 but I will do 1099 or corp to corp if you like.  My minimum is $50 per hour and in all honesty, I don't bill at my minimum rate often.  My "standard" rate is $75 per hour.  My "standard" rate for part time work (less than 40 hours a week) is $100 per hour.  I will look at projects anywhere in the world.  I charge $25 per hour per diem ($50 per hour in high living expense locations) for work done at job sites that are too far away for a daily commute.  I take care of my own travel expenses.  To allow me time to find my next project, I require a 30 day notice for when my services will no longer be required.  You may terminate my employment when ever you like, of course.  But you will still be invoiced for the remainder of the 30 day notice period.

Discounts: I have some flexibility with my rates and I try to be reasonable with my clients.  For very short projects where I will be using products that I really want to gain experience with, I may bid at a rate that is lower than stated here.  But that is done at my sole discretion.  If you really don't have at least $50 per hour to spend on your project, you probably shouldn't be looking at contract help to begin with.

Value pricing:  Most consultants charge a flat hourly rate regardless of the project.  This is especially true of Consultants who only work with a limited number of products or languages. I generally bid on jobs based on what I think my time is worth for the work that needs to be done.  For example, the going rate for a UNIX Administrator in this market is in the $50 - $75 per hour range. The rate would depend on the location, project duration and number of systems to be managed.  My rate for that project would therefore likely be in the $50 - $75 per hour range.  On the other hand, even incompetent Openview programmers charge upwards of $150 per hour. So for an Openview Architect job I would be more likely to bid at $100 - $175 per hour, depending on what needed to be done. I am not greedy at all but I am also in business and I know what the value of my skills is worth.

Rate depends on experience (DOE): I get a fair number of inquiries each week from "Recruiters" who live in former crown colonies. Invariably they are looking for people with decades of experience who are willing to work for way below market rates. This has become so pervasive in recent years that I rarely even return their calls any more. If you are a hiring manager, I would suggest that you contact one or two local recruiting agencies that are known to have good reputations (assuming that you don't want to do the recruiting yourself). To be candid, I just don't get involved with people who are only interested in finding the least expensive body to bring onto the job. I only work with people who's motivation is to reduce project risk by bringing in someone who can actually do the job. Specifically, if you are looking for an HP Openview Architect to travel thousands of miles to your site and live in a hotel for months at a time, and expect to find someone who actually knows what they are doing for $60 - $75 hour, you probably need to lay off the drugs a little.

Extras:  Unlike some US Presidents and Presidential candidates, I have never used drugs in my life.  I have no tolerance for drug users and I certainly understand why you wouldn't want to hire anyone like that. If you don't trust me enough to just take my word on this and require that I take a "drug screen test" to prove it, that's fine.  Plan on adding another $25 per hour as a rate surcharge.  I also add another $25 per hour aggravation surcharge to work at a company that is widely known to be an unhappy, unpleasant and/or oppressive place to be.  I am a mercenary ..and I will go where the work is....  but life is too short to be put upon for free..  

References:  People who require references before they will consider a particular consultant do not understand the contract employment business, in my opinion.  For complex, high paying projects that present a substantial risk to the client, I am happy to give them a couple of numbers to call so that they can talk to managers that I have done similar work for.  However, if you want to do a reference check to decide whether I am capable of administering a few dozen Solaris servers, plan on paying an additional $25 per hour reference check surcharge.


Contractor or Professional Consultant?:   There are huge differences between the two. People who do the type of work that I do are Consultants. Contractors tend to be more along the lines of "temporary help" and are frequently unemployed Techs who are willing to accept most any kind of work while they continue to look for a "real" job. If all you need is a Microsoft Windows Administrator to keep the servers running, a Contractor could work out very well for you. Consultants typically help Clients identify problems and then propose and implement Engineering solutions to those problems. These days, there are very few Network and Systems Engineering Consultants who do the type of work that I do. Most often, this need is filled by a VAR who will usually have financial incentives for recommending one "solution" over another. Obviously, these types of "recommendations" have limited value to the Client. Professional Independent Consultants are typically a lot less expensive than engaging a VAR. Since Consultants typically do not sell anything except their services, their product recommendations tend to be a lot more reasonable and responsive to your needs than what you might get from a VAR.

The latest scam from India:   Took me a while to figure this one out. It's a so-called "boiler room" operation running out of India. I get literally dozens of queries a week from guys with former crown colony sounding names. In most cases, you can barely understand them because of their extremely thick accent. These outfits all seem to have USA addresses and phone numbers, but the "suite numbers" usually look suspiciously like mail drops. I'm guessing that the phone number is a VoIP connection to Bombay or some place.

I first noticed this when I started getting a LOT of Google search hits on my on-line resume from IPs in India. Invariably, I would get an e-mail and a phone call from someone with a very Indian sounding name and a USA reply phone number shortly after they found my resume. These outfits are usuall y looking for someone with very high end skill sets for a job that's thousands of miles away from home. The rate being offered will be in the $60 - $80 per hour range, corp to corp, all inclusive.

As I said, it took me a while to figure out how this works. The Consultant agrees to take on the project for $70 per hour. Consultant travels to the site at his own expense and pays all of his hotel, meals and other living expenses out of his own pocket. Note that even though the Consultant is working a 5 day, 40 hour week, he nevertheless has 7 days a week of hotel, meals and living expenses.... plus, he is away from home for a very extended period.

These guys in India certainly know the value of the work being done by the Consultant and are charging the Client accordingly. I get a LOT of inquiries looking for HP Openview Architects... the going rate for an experienced HPOVO Expert like myself is in the $200+ per hour range. So... (this is the part that took a while for me to figure out), the way this scam works is that the India company does the deal with the Client (for as much money as they can possibly get) and bills them once a week or every other week for your time. The Consultant gets paid a fraction of what his time is worth when/if the guys in India feel like sending you a check. I've done projects where getting paid once a month is not that uncommon. The Consultant could easily rack up $10k+ in expenses (plus never being paid for hours worked) before he figured it out. The way this scam works best is if the guys in India end up paying the Consultant nothing as there is absolutely no risk on their end at all. Try suing a company in India for a civil matter like this! Or maybe they'll pay you just enough to keep you working on the job so that you're really into your own pocket by the time you figure this whole scam out.

Scams like this work best when there is little or no risk to the scam operator and this one certainly qualifies. My advice would be to run like hell when you see one of these characters coming. If you're REALLY hard up for employment, at least protect yourself a little by demanding an advance to at least cover your travel and living expenses. If anyone reading this has first hand experience that they care to share, I will be happy to put a link to their story here.

IT Managers constantly need experienced HPOVO experts and consultants like myself who are experienced with many monitoring tools such as BMC, CA, MOM and so on. My advice to hiring managers would be to Google what you want yourself or go through a local, reputable placement agency that will protect you with a W2 Consultant relationship instead of dealing with potentially "fly by night" operators. Since these guys in India work strictly corp to corp and since they undoubtably substantially mark up what is essentially a "pass though" service, there is absolutely no reason that I can see to be going through these guys.



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