Hey Guys, I really agree with below and it depends on your % of billable hours. But guys! You should be billing for nearly all your non-billable hours! You worked for it so send the bill! Quotes excepted.
In regards to the non-freelance space this is my calculations for full-time contracts. Hourly rate X 1840 = Annual package including superannuation How do I get 1840? 8 hours a day by 230 days a year (230 days is worked out as 52 weeks a year times 5 work days minus 30 days off for sick and annual leave) A contractor typically earns 20-25% more than a permanent employee. This is to compensate for the risk, time spent bidding for work and effort involved in chatting to pesky recruiters like myself :). But don't be too overly weary for recruiters :) We aren't all bad! We spend a lot of time matching people up with the best opportunities rather than in a non-open market where businesses can just screw their employees. Like yourselves we spend a lot of time on non-billable activities that fall through :(. I'm on linkedIn if you'd like to keep in touch.* **Ashley Pettit<http://au.linkedin.com/in/aspettit> * On Wednesday, 9 November 2011 16:45:00 UTC+11, Nicholas Faiz wrote: > > Hi, > > I've been watching job boards for Ruby related contracts lately and have > noticed some low rates being offered with high expectations. It's happening > frequently enough that I wanted to post my understanding of how to calculate > an hourly rate. Setting *reasonable* standards of pay for the appropriate > level of expertise is vital. There's a lot to say on the matter, so I've > tried to be brief. > > For some reason it's very easy for software developers to match their > experience and knowledge to a full-time rate, but for contracting there is > less awareness. > > The difference between full-time employment and self employment. > > Employers gain certain benefits from contractors. On a financial level, they > have less commitment, which means they do not have to pay for sick, parental > and annual leave, training, redundancy payouts (for redundancy see > http://www.netlawman.com.au/info/retrenchment-and-redundancy-australia.php) > or superannuation (at least 9% of base income). To hire someone on a > full-time basis is a serious commitment for an employer, and if the > relationship isn't successful they cannot simply end the agreement (see > unfair dismissal laws - > http://www.fairwork.gov.au/resources/fact-sheets/conditions-of-employment/Pages/termination-of-employment-fact-sheet.aspx). > > > So, employers can take project risks, using contractors, to build a > profitable application, without the consequences of supporting long-term > staff. If they (read large corporations especially here) had to commit to > long-term employment responsibilities before their endeavours became > profitable it would be prohibitive to start them. Good contractors are > essential for ventures hoping to build a profitable application and it's a > typical scenario that applications are initially built with contractors and > then, when mature, transition to full-time internal staff. > > Expertise. > > In addition, there's expertise to consider. Contractors are often experts (or > aspiring ones) in their domains. Full-time staff might specialise on a > particular use of a technology *and* the business. Contractors are expected > to specialise in the technology, and to bring new perspectives and expertise > to inhouse practices. So, these sorts of contractors also enrich the > development habits of their employer by showing them new ways to solve > problems which their own employees haven't had time to research. > > Remember, if these things don't happen, the agreement between the contractor > and the employer can quickly end. > > The basic rate. > > The rough calculation is your expected annual income, at a full-time rate > (including super, paid leave, etc.), divided by 1000. For e.g., for $75,000 > pa (including a super payment, holiday pay, potential sick leave cover, > etc.), the matching hourly rate is $75 (GST not included). This sort of > package would like be advertised at somewhere like 62k with benefits > attached, if converted to a full-time role. > > If you pull out a calculator and multiply the number of working weeks in the > year by the number of working hours (46 x 40) then times that by the hourly > rate, you'll find that this adds up to 138k. This seems to be excessive of > the targeted 75k income. But that's okay, for two reasons. > > 1) The employer hasn't hired you for 46 weeks in the year. > 2) If you are able to bounce between short-term contracts continually, then > that's a good thing, but the employer's agreement with you doesn't guarantee > this and it can't be used as a justification to lower the rate. The reality > is, in the contracting scene, there are sometimes gaps in employment for > upskilling (open source coding, etc.), rest, or securing the next role. > > This rate leaves to one side the notion of expertise. If you're an > exceptional candidate, for whatever reason, or if the technology you > specialise in has a rarer skillet, or is in high demand, then these rates can > adjust to such things. The reality is that Ruby and the frameworks around it > are an in demand skillset, so if anything the rates should go higher. > > So, beware of contractual roles which are, in reality, heavily benefitting a > company or (more than likely, a middle man agent), and offering > incommensurate rates for skillsets. Support the employers that do offer fair > rates by doing good work. > > > Cheers, > > Nicholas > > -- You received this message because you are subscribed to the Google Groups "Ruby or Rails Oceania" group. To view this discussion on the web visit https://groups.google.com/d/msg/rails-oceania/-/6jN67bIHl-YJ. To post to this group, send email to [email protected]. To unsubscribe from this group, send email to [email protected]. For more options, visit this group at http://groups.google.com/group/rails-oceania?hl=en.
