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| Reply To This Thread |
| Re: Finders fee |
| Author: | Mitch |
| Date: | Tuesday, 21st Apr 2009 16:02 |
| Views: | 25 (excluding Digests and RSS feeds) |
| Category: | Other | | URL: | http://web.ukrecruiter.co.uk/forum/Forum/read.php?i=182655 |
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Can you not let him bill you monthly and you markup and bill the client monthly?
Failing that, if it's a 6 month contract, I would charge them 60-70% of the salary as a placement fee and tell them they can re-hire him whenever they want in the future without incurring any additional fees. |
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| Reply To This Thread |
| Re: Finders fee |
| Author: | Ruffski |
| Date: | Tuesday, 21st Apr 2009 16:28 |
| Views: | 33 (excluding Digests and RSS feeds) |
| Category: | Other | | URL: | http://web.ukrecruiter.co.uk/forum/Forum/read.php?i=182655 |
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What's stopping you from contracting him to your client under a contract for services? Most of our contract workforce operate on a Limited Company basis, which is far easier for our payroll to deal with as they don;t have to do anything but make a gross payment to him and invoice the client, there are no tax or NIC issues to deal with. You'll need to see copies of his / her certificate of incorporation and company bank account details and VAT Certificate if they are registered for VAT. I'm sure you could get a contract template from the REC or Professional Contractors Group (PGC) which would offer you both security (His / her main issue will no doubt be IR35 related, but PCG contracts are written to give protection for this) The main thing your contractor needs to be aware of is that IR35 works on 2 levels, the contract being one and the other being the companies work practices, but in reality it's pretty simple. This would probably be your clients preferred option as when supplying a Limited Company contractor, you can't normally tie them into a defined length of contract, hence your client may not want to pay such a big fee on the basis that the Limited Company contractor may not hang around for too long.
Feel free to email me directly if you have any specific questions Liz and I'll do what I can to help.
Thanks
Ruffski |
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| Reply To This Thread |
| Re: Finders fee |
| Author: | liz |
| Date: | Tuesday, 21st Apr 2009 17:03 |
| Views: | 26 (excluding Digests and RSS feeds) |
| Category: | Other | | URL: | http://web.ukrecruiter.co.uk/forum/Forum/read.php?i=182655 |
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Thanks for responding guys. The reason I don't do temps is because I want my bank balance to be really healthy so that I can afford it. If one of my clients didn't pay immediately then I'd be paying out a lot and would struggle cashflow wise.
If he got £30ph and did 40 hours pw that's £1200, so around £5k a month. I don't want to be paying that out and then waiting for my client to pay (they always pay by cheque as well).
I thought for the sake of simplicity to just charge a finders fee and then he's theres for however long.
Thanks for the IR35 info Craig. This guy has been working in this way forever, for major companies like Thomas Cook, so I'm hoping he's aware of all the rules and regulations.
Just tweaking your idea slightly Mitch what about (if they don't want the large finders fee because there's no guarantee of longevity), he invoices them weekly/monthly/whatever and I also invoice my client on a monthly basis with the markup. Could that work? |
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| Reply To This Thread |
| Re: Finders fee |
| Author: | liz |
| Date: | Tuesday, 21st Apr 2009 17:32 |
| Views: | 48 (excluding Digests and RSS feeds) |
| Category: | Other | | URL: | http://web.ukrecruiter.co.uk/forum/Forum/read.php?i=182655 |
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Good idea, have suggested that. He baulked at the £7k fee. I've done so much work on this and we agreed a flat fee upfront (I always discuss rates upfront). However, that was a for a perm person and I didn't anticipate going down this route.
I do feel that I haven't done a good enough job on justifying my fee to him, despite him knowing exactly what I do. I think that as a regular client he just expects the level of service and added value that I give. |
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| Reply To This Thread |
| Re: Finders fee |
| Author: | David James |
| Date: | Tuesday, 21st Apr 2009 18:27 |
| Views: | 38 (excluding Digests and RSS feeds) |
| Category: | Other | | URL: | http://web.ukrecruiter.co.uk/forum/Forum/read.php?i=182655 |
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Hi Liz
Having worked for a start up i can understand where you coming from regarding cash flow and if you don't usually place interims it's perhaps not worth engaging an invoice factoring company.
Usually we would charge 20 - 25% margin for an interim (ltd Co Contractor), so in this case £30 per hour x 25% margin = £40 per hour giving you £10 per hour profit.
Could you take this figure and multiply by the hours your contractor is required to work and invoice this on a monthly basis - 35 hours per week x 4 weeks (140) x £10 = £1400? The reason it is more expensive is that you might have done all the work only to find the client only requires the person for 4 -6 weeks and £1.5 - £2k for finding a £60k candidate hardly seems justified.
As a gesture of good will maybe you could reduce this slightly as you will not be exposed to the credit risk which is paying the contractor for up to 2/3 months without receiving any money.
Alternatively, maybe you could work at a slightly lower rate of 20% but split the fee over a couple of months – £6200 fee payable in 2 instalments, recurring every 6 months?
I think it is worth bearing in mind that in this current climate clients might look to recruit interims as it improves their cash flow - i.e. take someone on interim and they don't have to pay anything for a couple of months, in this case it could amount to over £12,500 in wages alone.
Whatever you agree Liz, and i know it goes without saying, but get agreement in writing from your client as this will probably fall outside of your normal terms of business.
All the best
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