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How to Hire a Good IT Contractor

Even if you are blessed with a stellar line-up of permanent IT staff, there can be times when temporary help may be needed to crack a difficult project or meet an unexpected deadline. Opting to use a contractor instead of a permanent employee can be beneficial for a number of reasons. Contractors can fill a […]

By Alex Graham on 09 Mar 2016
Read time: 4 minutes

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Even if you are blessed with a stellar line-up of permanent IT staff, there can be times when temporary help may be needed to crack a difficult project or meet an unexpected deadline.

Opting to use a contractor instead of a permanent employee can be beneficial for a number of reasons. Contractors can fill a skills gap in your workforce, be more cost-effective than a permanent employee and boost your headcount temporarily in busy business times.

Many IT professionals still feel sceptical about using contractors. Common concerns include quality of the work, a perceived security risk and effectively communicating your project needs to an individual not familiar with your company.

But, with a little careful planning, there is no need to feel pensive about hiring a contractor. Here’s a step-by-step guide to dealing with IT contractors:

Work out your rates

Most IT contractors are paid on a daily or hourly rate – this amount will vary depending on a huge range of factors such as skill set, market demand and experience. Recent research from accountancy firm Nixon Williams found that almost one third (32 per cent) of the IT contractors they surveyed commanded daily rates of between £400 and £499, with 30 per cent receiving £500 to £750 per day.

In order to offer competitive rates, you will need to do a little research of your own – try contacting a few recruitment agents or scanning recent advertisements for IT contracts in your sector.

Be ready for some unique CVs

A contractor’s CV may not follow the ‘normal’ layout and content you might expect from an employee. They tend to tailor their CV to the project they are applying for and only include the relevant experience and information required. Alternatively, some IT contractors will offer you a portfolio of their work, usually as in an online format. Be flexible here and remember you are entering into a business-to-business relationship here, not recruiting a permanent member of staff.

Interview once, and well

There should also be a different approach to interviewing contractors, compared with permanent positions. A contractor will come to an interview ready to sell their skills and experience and will not often be available for multiple interviews. It’s also important to ascertain whether they will fit in with your company, culture and work well with your permanent employees within this one key meeting.

Finding contractors

Many IT professionals turn to recruitment agencies when filling their contract vacancies. Make sure you do your homework before selecting an agent to work with.

Start by looking at agencies that advertise contracts similar to yours, then investigate further. The IT recruitment agency directory is a good place to start. It is important to choose an agency that has an in-depth understanding of your specific industry and IT sector – as well as experience in hiring contractors. A bonus when dealing with agencies is that invoices often come directly from them, so they are left to deal with all the compliance and payment of the contractor – but this will come at a markup cost.

If you want to avoid recruitment agencies completely, you can try to source a contractor directly by advertising on contract job boards or searching CV databases. A specialist IT job site such as Technojobs is worth a look and social media tools such as LinkedIn are also useful to help reach out to candidates.

Negotiations with contractors

Once you’ve picked your candidate there is often a period of negotiation over their rates, the length of contract and the services the contractor will provide. This could be outsourced to a contractor recruitment agency if you are unsure of handling the negotiation process. It’s an obvious point but never hire a contractor without a clear contract in place.

Signing on the dotted line and IR35

IR35 is a piece of legislation that all contractors must work under. It was designed to stop unscrupulous contractors working as ‘disguised employees’ by taxing them at a rate similar to permanent employment.

An IR35-friendly contract reflects that a contractor does not have the same responsibilities, control and benefits as a permanent employee – so they can be taxed as ‘self-employed’ accordingly. IR35-friendly contracts will go a long way to keeping contractors on board.

It is also vital to complete the relevant security checks on your prefered contractor at this stage, and ask for references from previous work. A good contractor will happily provide this information and alarm bells should ring if they do not.

Keep good contractors on board

Once the contract is completed, and if you are happy with a contractor’s work, then it is a great idea to keep their details on file for future work. Not only will this save you from dealing with recruitment agencies and interviewing endless candidates – you know this person will already have experience working with your business and can hit the ground running on future projects.

If you feel that now is the right time for you to make the move to contracting, then please call our New Business Team on 01253 362062 or email contractoradvice@nixonwilliams.com

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