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An Agency’s View of Contracting

SQ Computer Personnel is one of the largest privately owned IT Recruitment Consultancies in the UK, supplying both contract and permanent IT staff. We speak to Director David Ward regarding a number of issues facing modern contractors, and learn a few tricks of the trade along the way.

What are the common concerns of contractors who are new to the profession?

We have found that contractors who are new to the profession have an initial concern regarding how to manage their company’s financial / tax position because it is something that they have no previous experience of.  Contractors often want to gain the best financial rewards from contracting but can be concerned regarding the level of risk involved if they choose to work outside of IR35, so it is important that contractors ensure that they are receiving sound advice.

Also, in an uncertain market there is the natural concern over job security and whether or not their contract will be renewed beyond its initial term.

Are any sectors performing particularly well/badly at the moment?

SQ Computer Personnel provides IT and Project resources to its main client base of Financial Services, Oil & Gas, Payments / Card Processing companies.  We have found that IT and Project based recruitment for our clients across these sectors have performed consistently throughout 2013. 

Do new contractors tend to be aware of IR35 and, if so, are they concerned about it?

The majority of SQ’s first-time contractors tend to already be aware of IR35 because they are either friends with or have worked closely with seasoned contractors who have given them advice on how they operate their own ltd company.  At SQ we help to resolve any additional queries regarding IR35 by offering our contractors a ‘First Timers Guide to Contracting’.  We also put our contractors in touch with an IR35 specialist accountancy firm and IR35 Insurance companies.          

Have you noticed a decline in the number of contractors using umbrella companies?

We have noticed that those first time IT contractors who initially chose to work via an Umbrella company then tend to set up their own ltd co as soon as their contract is renewed or when they find their next contract assignment.  We have also seen an increase in the number of contractors moving away from tax avoidance schemes and back into working via their own ltd co.     

As a recruitment specialist, what tips could you give a modern contractor in landing contracts and seeking new job roles?

Other than the traditional methods of checking job boards and keeping in touch with preferred agencies, I would advise contractors to make as much use of their network as possible.  A good level of vacancies are not released to agencies because they are filled directly by the hiring manager utilising his or her own network of contractors.

Do you think LinkedIn is a useful tool for contractors looking for new roles?

Absolutely. Both from a self-promotion perspective and networking perspective.  For a contractor looking for their next assignment their LinkedIn profile can be as important as their CV because we are finding that more and more of our clients are starting to look at a candidates LinkedIn profile and recommendations in addition to their CV when deciding on who to shortlist for interview.  Also by updating your status on LinkedIn to say that you are looking for work or have found work will alert the world to your change of availability.  

Do you have any tips for contractors when writing/reviewing their CV?

The move in recent years towards cutting down the number of pages in a CV has stayed in place.  Our clients prefer to receive CVs that hold quality information in a clear and concise summarised manner.  Some say that a CV should be as little as 2 pages, however the majority of our clients will accept a CV of up to 4 pages in length.

It’s a good idea to have a general CV which covers all skills and experiences for agencies to keep on their files to use when they conduct database searches, but do not limit yourself to having a ‘one CV fits all’ approach when applying for roles.  You will get better results if you tailor your CV to bring out your relevant skills and experiences for the particular role you are applying for.

What would you say the general success rate of interviews vs. placements is?

It really can vary depending on the demand for skills vs. the volume of suitable candidates on the market.  Candidates with some specialist niche skills can be offered every role that they interview for, whereas some more generalist IT / Projects contractors may need to interview for many roles before they receive an offer because of the high amount of competition they face.       

Do you have any words of warning to budding contractors out there? Any tell-tale schemes or ploys that they should steer clear of?

The contractor has the final decision on how they operate their vehicle and what level of risk they are prepared to take but with tax avoidance schemes coming under more scrutiny it is very important that contractors don’t just buy into the glossy sales brochures of the avoidance schemes and always get independent impartial professional advice before making any decisions.

David is a highly experienced contractor recruiter, and has agreed to answer any questions asked. To leave a statement or ask David a question, please leave your comments in the box provided.

By Troy Stevens

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6 thoughts on “An Agency’s View of Contracting”

  1. Scott

    Shame there was no question regarding the Opt out of Conduct of Employment Agencies 2003 act? And why some recruitment agencies break the law in forcing Ltd Company contractors to sign the Opt-out agreement.

  2. David Ward

    At SQ, we are happy for our contractors to either opt in or opt out. However we find that by opting out, contractors hold a stronger position with regards to working outside of IR35.

  3. Scott

    As like many recruitment agencies, you fail to realise that the Opt-In/Out issue has nothing to do with IR35. Please go and recheck your facts. The only reason agencies want contractors to Opt out is so that they can hold them to restrictive handcuff clause before and after working for the client and ensuring that if the client does not pay you, any contracts that ARE OPTED IN BY DEFAULT you are still liable to pay them. IT IS NOTHING TO DO WITH IR35.

  4. David Ward

    I agree with you that there are benefits to the agency too if a contractor chooses to Opt-out, however as I said before it is the contractors’ choice entirely and we will not force a contractor to work in one way or another. SQ may operate in a different way to other agencies with regards to our liability to pay contractors because we honour our contractors’ payments regardless of whether they have Opted-In or Out. We spoke to IR35 specialist accountants and IR35 insurance companies to discuss the potential impact. It was on the information and advice that they gave that by opting out a contractor holds a stronger position with regards to working outside of IR35, basically because opting out helps imply that you are not a temporary worker requiring the kind of protection that agency workers require, and AWR tries to supply, but that you are running a genuine business.It is not a massive indicator of IR35 status, but our advice is that it helps a little, and every little helps…!

  5. John

    Does SQ provide some form of guarantee of service? In my experience agencies tend to lose interest if I fall short by failing an interview. Does continuing support exist?

  6. David Ward

    Hi John, Would you like to connect to me on LinkedIn so that we can talk about your interview experiences offline? uk.linkedin.com/in/davidwardsq/
    Thanks

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