Hello folks,
I’ve managed to get myself a pretty decent, several months long full time contract job. However, I’m told by this company that since they are hiring me on a contract basis, they want me to make up the contract. Here’s where it gets tricky-- they are offering the weekly pay rate I had asked for, but don’t pay overtime, and don’t want to stipulate the number of hours I will work per week in the contract, since they expect it to fluctuate with deadlines (but will be 40 hours per week on average, or so they tell me). I’m just wondering, how can I include some sort of provision for myself in this contract, so I don’t end up working a lot more hours than I’d like for the same amount of money? And since I’m the one making up the contract, should I specify some sort of termination clause in case they decide they want to end the contract early? Any advice, or links to helpful sites would be greatly appreciated.
I’m not a lawyer, but I used to be Contract Manager for a small company.
What you want to do it write out very clearly what the expectations are. Is it a fixed-term contract? If the contract is for, say, 10 weeks at an average of 40 hrs/week, I’d write out that the contract is for up to 400 hours of work to take place between <your start date> and <a date 10 weeks later>. Then they’ll have to renegotiate with you if they make you work 60 hrs/week and, halfway through, realize that they’ve burned up the 400 hours on the contract. And make sure to hold them to it - when hour #401 starts, you stop working until they agree to pay you more or you agree to continue at the same rate - get it in writing either way.
Alternatively, if it’s an indefinite term assignment, just break it down into, say, 4 week increments and state that you will work up to 160 hours in any 4 week period; that would ensure that you maintain a 40 hour average workweek while at the same time allowing them to ramp up or down your hours a bit.
To either of these, you can add a clause stating “any hours worked above XX hours will be billed at the rate of $Y/hour,” if you want to avoid renegotiating when the hour limit is reached. Make sure to state that you’ll give written notice when that threshold is about to be or has been reached, and do it, so they can’t come back and say “well, the project leader didn’t know you were about to go over the hours and would have taken you off if he had.”
In short: be definite, and make sure everything is written down and signed by them before you start work. They could still dick you over, of course, but they almost certainly will if you don’t.
To add to what JerH has already stated (good advice, imo):
Last one of these I did was like 3 months ago, I don’t do these often, but I have worked both sides of the fence, so here goes:
[btw, this advice is employee-biased, oh, and this post isn’t a factual question]
I like the 160 hr thing (my preferred method), but I would push for the weekly 40 hrs/wk thing, though with caveats. Each week you will be paid for 40hrs work at your price/hr as you indicated. At 120 hrs, you should indicate formally in writing that they you are at 120 hrs, and where you are in the project (or whatever it is you’re working on), and that over-time is coming. You may receive strong pushback against overtime if it is not industry standard, but you could counter that you are giving fair notice to your employer.
Limit your hours to Mon-Fri, unless you’ve been doing the weekend and late night stuff before (if you have, it just becomes harder to get). I try to give my clients a normal 40 hour work week, and make the employer pay over-time for extended hours, and on-call hours, even though the 40 hr work week hadn’t been reached yet.
Your termination clause should specify a 4 week notice (unless it’s the last month). Anything less, then charge them 80 hrs as a termination for convenience. Position yourself as an independent contractor (you are, aren’t you?), and that you’re planning on being at the job for X number of months. The 80 hrs allows a cushion for you to seek another job. Ok, I’m super late, and I have to run. Hope this helps.
one possibility might be to ask for comp (compensatory) time instead of overtime. if they are telling you the “average” work week will be 40 hours, then they shouldn’t mind putting it in writing. if you work 50 hours in one week, then you claim 10 hours of comp time for that week. then maybe for the next two weeks you only work 35 hours each week, or 30 hours for one week, or whatever. or you save your comp time and add it to your next vacation. it wouldn’t cost the company anything to agree to this unless they were dishonest in what they told you about the hours originally. to give the agreement some teeth, you might ask to be paid for comp time that you haven’t used when your employment ends.
Separate but related: When a company hires employees, the company (at least, large ones) usually provide benefits like vacation, medical insurance, life insurance, etc. And, of course, the company pays the company-portion of social security (I assume you’re in the U.S.)
As a contract employee, you get none of that. In addition, you’re self-employed and so much pay both the company-portion and employee-portion of social security contributions.
Be sure to set your wage rate high enough to include these “lost” benefits … on an after-tax basis!