What kinds of problems are likely in software engineering temp contracts?
May 17, 2012 3:25 PM   Subscribe

I'm a software engineer. I have a job lead that requires me to go through a temp/contracting agency. I have not done that before. Is this a good idea? Are there things I should be watching out for in the contract? Or is it generally clear sailing? Thanks very much for your help.
posted by anonymous to Work & Money (13 answers total) 2 users marked this as a favorite
It's pretty routine and I've done it many times.

Good points:
*The agency pays you, so you should know when to expect your paycheck regardless of any shenanigans by the company.

*You'll most likely be on W2, meaning you stay eligible for Unemployment of needed later.

*Some agencies may offer you a benefit plan.

*If the agency has a good relationship with the client, it may be easier to get hired on FT, if that's a goal.

Bad points:
*If the company wanted to hire you FT, they owe the agency a fee. This is a non-issue for most companies that use agencies though.

*The agency is "skimming" off the hourly rate, so you may get less then you would as a totally independent contractor.

*The people from the agency will lie to you about everything as a matter of routine. That's just their way.
posted by drjimmy11 at 3:45 PM on May 17, 2012 [6 favorites]

(The above was assuming you are going for a contract job. If the agency is submitting you to be a FT employee, disregard most of that. In that case there are almost no drawbacks for you.)
posted by drjimmy11 at 3:46 PM on May 17, 2012

In general this has been smooth sailing for me. In fact, many of the contracting agencies in our industry offer better benefits and more assurance that you will get paid on time.

Read everything you sign, and strike freely from contracts. Don't give up rights to previous inventions. (This is actually not enforceable in some states, YMMV, IANAL)

It never hurts to research the contracting company in question.

If you actually need a contracting middle man, consider: http://www.solow2.com/ friends have used them with no problems.
posted by poe at 3:48 PM on May 17, 2012 [1 favorite]

I've done this for about a year. On the whole, it worked just fine, but here are some things that caught me off guard.

Watch that the work tasks as described are actually what the job will entail. I got bitten by this one. Imagine if you were hired to do, say, HTML, at an HTML-appropriate wage, and then once on the job, your client realized you had more advanced skills: "Oh, you do Java? Great! HEY THIS GUY DOES JAVA!" And all of a sudden, you're doing Java at HTML wages. Oops.

Clarify who you should contact when, say, you need to call in sick, or late. Usually the temp agency will run interference (which I liked).

Clarify overtime, etc. Your contract will spell this out, but it's good to make sure the agency's understanding matches the client's.

Overall, it was a positive experience. I was hourly, and I LOVED being paid for every hour of my work, vs. watching my hourly rate decline as unpaid overtime crept into the schedule.
posted by quivering_fantods at 3:52 PM on May 17, 2012

Contract-to-perm and temp-to-perm is extremely normal in tech hiring in the US, but in the past few years a common twist is for contracting agencies to inject themselves into the process (by reading the job listing online and contacting you as if they are specifically representing the hiring company) when the hiring company would prefer to just hire direct. That way the agency gets a finder's fee and gets to skim your paychecks and you, in all likelihood, get paid less when you go permanent than you would if you had hired directly in.

Check the hiring company's website to see if they have listed the job themselves. If so, apply directly. If not, and you really do have to go through the agency, just keep in mind that you are livestock to them, not a precious resource. You do get the advantages of being W-2, though, which keeps your taxes from getting complicated.
posted by Lyn Never at 3:53 PM on May 17, 2012 [2 favorites]

I think this situation has become a lot more common and a lot less abused since it was made famous by Microsoft.
posted by gurple at 3:57 PM on May 17, 2012

Stating the obvious, but: it's worth researching the reputation of the agency as well to see if the job they are pitching you even exists. There are a few agencies that are known for monkey business such as luring you in with promise of a non-existent job, and then trying to get a company to create a job for you. Perhaps not the worst thing, if you end up with a job out of it, but still.

There is one agency who posts zillions of programming jobs in my area, who never EVER seem to get back to anyone. There is some discussion online that they are part of a dodgy scheme to slip H1-B labor under the radar. Dunno.
posted by quivering_fantods at 4:07 PM on May 17, 2012 [1 favorite]

Pay close attention to how overtime reporting and pay is spelled out in the contract.
posted by asockpuppet at 4:18 PM on May 17, 2012

*The people from the agency will lie to you about everything as a matter of routine. That's just their way.

So true

And, if you find you really like the people you work with and they make you an offer over what the pimps are paying you, then you're typically screwed. It's a pretty common way of being IT employed here - so mostly it's OK. There are some shonks. Make sure they are paying all your benefits etc...
posted by mattoxic at 6:31 PM on May 17, 2012

it's worth researching the reputation of the agency as well to see if the job they are pitching you even exists

Yeah forgot to mention that. Cybercoders is one I know of that seems to send me jobs that don't actually exist. I think what they're doing is pulling keywords from my resume, then emailing me about a "job" that fits me really well in the hope I'll respond.

Then they'll have me in their database and on call if a job actually materializes. A lot of them will do whatever just to get you in their system. Not really harmful, just annoying and disingenuous.
posted by drjimmy11 at 6:33 PM on May 17, 2012 [1 favorite]

(What I do to check is google bits of the job description. It's not like agencies bother to rewrite them, and it's not like it wouldn't be posted somewhere else if the job really existed.)
posted by drjimmy11 at 6:34 PM on May 17, 2012

Good points made above. Been a long time since I did any contracting but here's my 2c from a European perspective.

1. Some agencies will lock you in to a term during which you cannot accept further work from the company without going through them. imo, not really a problem as long as it is reasonable, but some get silly with the duration, e.g. 2 years for a 3 month gig, and you can usually get this reduced to something more acceptable.

2. Anything that has a broad range of skills is a harvesting ad, and has nothing behind it. All they want is you on their books.

3. There are a few good agents, but many of them were selling furniture and white goods a couple of weeks ago and now they are working off a script. Explains why they lie so much.

4. You can often find out what rate the is that the hiring company is paying. If you're new at contracting you may be find a huge discrepancy between that and what you get.

Not to worry, if the company likes you and you get extended, this is the time to rectify the situation. Otherwise, its a lesson you needed to learn anyway.

5. Used to be that all contracts were for 3 months. If they like you, you get extended, because typically they need someone for a longer term, otherwise they would tough it out internally. If they don't like you its "thanks for your hard work but the position is no longer required".
posted by w.fugawe at 12:27 AM on May 18, 2012

The markup on your rate at these agencies is shockingly high. I found out that for a job I was considering taking, the recruiters had marked my rate up by 50%. On one hand, maybe you wouldn't have found this gig without them.

On the other, it makes you think - what could you find on your own, putting yourself out there for 66% of what these recruiters charge these companies? It's worth considering.
posted by ignignokt at 11:41 AM on May 18, 2012

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