Talent Development Centre

Category Archives: Independent Contracting

All Talent Development Centre posts for Canadian technology contractors relating to independent contracting.

How to Talk Money with Recruiters

Sam Rahbar By Sam Rahbar,
National Training Manager at Eagle

No one likes to discuss salary or rate, it can be an awkward conversation. But as an IT consultant this is a topic that comes up all the time when discussing contract opportunities with recruiters. Rate conversations can often turn into a long drawn out back and forth between the recruiters and consultants. Here are five tips on how to work with a recruiter to avoid the unnecessary lengthy conversations and land the best rate possible:

  1. Customize your resume. Before applying to the role, make sure to include all your relevant experience related to the provided job description, including the nice to haves. Don’t leave any room for assumptions. Competition is fierce and a customized resume is the first step towards getting a more competitive rate.
  1. Remember, you are on the same team! A recruiter’s primary role is to present the best available candidate with the most competitive rate. Work with your recruiter to find out the top end of the rate and the sweet spot where the client likes to hire at. With VMS companies dictating level playing grounds for all recruiting agencies, these days all recruiters work within the same rate brackets and cannot go above or below a certain percentage. This means all recruiters will compete for the best candidate with the most competitive rate.
  1. Ask about market rate. When it comes to current market rates, recruiters have VIP access! There is no one better to educate you on who is hiring at what rate. This is crucial information when it comes to landing your next gig. Ask your recruiter for current market rates, so you are able to position yourself accordingly.
  1. Be flexible. I hear so many times about great candidates that lost out on opportunities due to not being flexible on a couple of dollars an hour. Clients want the job done with the best quality and most reasonable price. Sometimes that 2-3 dollars an hour can put you in a competitive advantage. And when you calculate 2 dollars an hour over a course of a 6 month contract, after taxes, it does not amount to much. It’s definitely not enough to lose out on a chance to work on a project with a reputable brand.
  1. A new project means a new budget. Different clients will have different budgets based on their industry, type of project and market rates. It is normal to have your hourly rate fluctuate 10 dollars, up or down, depending on the end client and type of project. So try not to use your most recent rate as a hard bottom-line for your next contract because that will potentially limit your options.
  1. Consider the BIG picture. When discussing a new opportunity with a recruiter, make sure to consider all angles: length of the contract, possibility of extension, getting exposed to new technology, or a new type of project under your belt. Think about what the positive effects could do for your marketability long term. There are other factors to consider like your hours, commute, company culture, and perks to name a few.

 

Should IT Contractors Charge for Their Breaks?

Should IT Contractors Charge for Their Breaks?Sorry to break this to you, but as critical as your role may be to your project, you’re not that important. Yes, even you deserve and can afford to take a break throughout the day, and you shouldn’t feel guilty about it. In the same way athletes require a break to recharge muscles, so do office professionals to recharge their minds. We recently published a post about the benefits of taking breaks and some tips on maximizing those benefits. As an IT contractor, it all may be a great idea but can raise an additional question — how do you charge your client when you take breaks?

In the simplest and most straight-forward terms, as an independent contractor, you should only charge your client for the time you are working for them. Most clients only require timesheets to say the total hours worked per day (or even a period) but you may come across some who want to see a breakdown of your hours worked. In theory, separating every chunk of time and submitting it to a client would be easiest to demonstrate your productivity; however, that is not a practical solution. Especially if you follow the “microbreak” strategy of time management and take 5-minute breaks every 25 minutes, that is going to be a long, complicated timesheet. It’s more common for independent contractors to charge in increments of 15 minutes and adjust their time for the entire day. For example, if you worked 8-4 with six 5-minute breaks throughout the day, you would only record 8:00 to 3:30, which makes up for the half hour worth of non-productive time.

There may also be a grey area in what is considered a “break” and what is billable. For example, some independent contractors eat lunch at their desk and deem that time as working so do not record a lunch break. In these cases, you must ask yourself how available and productive you actually are. Although you are sitting at a desk, if you’re busy eating and ignoring phone calls or emails, it is technically a break. On the other side of the coin, everybody’s day consists of a couple quick personal phone calls and of course “nature breaks”. Should your client really nickel and dime you for such situations? Finally, when you take a quick 5-minute walk to clear your mind, you’re sure to return more energized and productive. Given that quick bit of exercise was in your client’s best interest, can you charge them for it? How you respond to those questions is a combination of your personal ethics and the agreement between you and your client, but it is important to be aware of your activity.

Tracking your breaks can be an eye-opening experience, on both extremes. You could learn that you are over-charging your client or realize that you should add some breaks into your day. Tracking that time is as simple as keeping a spreadsheet or notebook. You can also download a time management app that lets you quickly turn on and off your work time. Though you’re unlikely to charge your client 6 hours, 41 minutes, 4 seconds, seeing that final time will hopefully make you think twice before billing out an even 8 hours.

An honest and open time management system is crucial to a working, trusting relationship with clients and staffing agencies. No ethical independent contractor is out to rip of their client, nor do they want to rip off themselves by undercharging or failing to take care of themselves with proper breaks. How do you manage breaks and time entry with your clients?

How IT Contractors Can Take Better Breaks

All IT contractors can relate to how easy it is to get caught up in a project and let time fly by. You pour back coffee and energy drinks to keep moving towards your end goal and eventually hours have flown by and you haven’t left your computer. You may end those days thinking you maximized your productivity, but did you really? Even if you did, was it enough to justify the negative consequences of skipping a break? According to a ton of recent research, you’re not doing yourself any favours.

Taking a Break is a Good Thing

Study after study has proven that taking a break throughout your day is indeed a good thing. On top of simply being refreshed physically, when you step away from a task that requires a lot of thinking power, it gives your analytical processing skills a break. When you return, your renewed energy — both mentally and physically — allows you to solve problems faster, which in return, boosts your productivity.

But delivering a better solution to your client shouldn’t be your only motivation to take a break. A pause from work is important to your own well being. Accepting that you should have time away from your desk means you’ll open up more time to exercise and eat properly through your day. You can also run some personal errands and tasks, which will free up your evening, ease a stressed out mind, and maximize work-life balance.

How to Take the Best Breaks

We understand. Taking a break is much easier said than done, especially in the IT industry when you have to deal with emergencies, outages and tight deadlines. IT contractors can’t just get up from your desk and leave… or can you? Keep in mind that you are a contractor, and not an employee — you are entitled to work any hours you please as long as you continue to honour the agreement between you and your client. Here are a few tips to take the most effective breaks:

  • Fully detach. When you take a break, turn your mind off completely from the task-at-hand and change your train-of-thought.
  • Move around. This will help with the previous point. Get away from your desk, go outside, and get some exercise.
  • Be social. Breaks are better with others and the social aspect will help you recharge. Just be careful not to distract your client’s employees.
  • Avoid all screens. When you go outside to recharge your batteries and get your mind off things, your phone is going to be a hinderance. If you must bring it with you, put it on silence and turn off email alerts.
  • Take a nap. Research has proven that a quick 20-30 minute nap can have significant health benefits for some people. Meditation is also an option that will clear your mind.
  • Do something else. Perhaps you don’t want to take a full break. Completing entirely separate, irrelevant tasks will let you stay productive AND temporarily break from your current project.
  • Take Microbreaks. Often when we think of a break it’s the traditional 1-hour lunch break, but productivity experts also encourage microbreaks throughout the day. For example, 90 minutes on/20 minutes off or 25 minutes on/5 minutes off.
  • Try any one of these 51 ideas to do when you need a break from The Muse.

Taking breaks isn’t just important at work but everywhere in life. Home DIY projects get done with more care when there are breaks, gamers see more success when they let their mind rest for a few minutes, and resumes are written much more clearly when you review them with a fresh set of eyes. How often do you take a break?

Bill 148: What Independent Contractors Need to Know

David O'Brien By David O’Brien,
Vice President, East Region & Government Services at Eagle

The Ontario Government introduced a sweeping legislation last fall regarding work and the ESA (Employment Standards Act). Many of the changes came into effect on January 1, 2018 with additional pieces that took effect April 1, 2018 and more to come on January 1, 2019.

Bill 148 covers an array of components. In addition to the headline-grabbing dramatic increase of minimum wage, there are changes to vacation entitlement, personal emergency leave, equal pay and termination of assignment pay for temporary employees, union certification rules and many others. All of these components have very significant impacts to employers and employees alike.

However, another very significant impact of Bill 148 that directly impacts independent contractors is employee misclassification. The new bill introduced a reverse onus provision whereby employers must demonstrate that any independent contractors they have engaged are not in fact employees.  Bill 148 shifts a substantial new burden of risk to employers and employment staffing agencies and will potentially have several unintended consequences as a result. As is often the case with activist governments, it is the unintended consequences of legislation that can be the most impactful.

In Ontario, it is estimated that about 12.5% of the total workforce of 5.25 million identify as self-employed, which is about 630,000 contingent workers. It is further estimated that of this group about 55,000 are knowledge workers in the IT, Engineering, Finance and Healthcare sectors, who bring significant economic impact to many of Ontario’s private and public sector organizations. The majority of these knowledge workers are independent, incorporated contractors. As the nature and notion of work transforms to a more project or engagement-based ideation, these knowledge workers are critical. With the modernization of our economy and overall productivity and competitiveness, our governments should be looking for ways to adapt to this new reality.

With the new legislation, when there is a question about whether an individual is an employee or independent contractor, the reverse onus provision is triggered. This means the burden lands on the employer or agency to prove the individual engaged with them is an independent contractor, not an employee and as such would be excluded from ESA coverage. As experience indicates, work moves offshore when employers are faced with impediments like this. Employers losing access to these valuable resources on a contingent basis should be very concerned.

Employers and staffing agencies are now looking at ways of assessing individuals to understand the true nature of relationships early on in engagements to ensure this risk is mitigated. These early assessments will help determine whether such individuals are properly classified as independent contractors.

As an independent contractor, there are a number questions you can ask to help establish the nature of your relationship with your clients. Here are a few of them to keep in mind:

  1. Are you providing services through a corporation?
  2. Have you registered with CRA for GST/HST?
  3. Do you carry business insurance, such as commercial liability or errors and omissions insurance?
  4. Do you market your services as a business, for example with a website, business cards, etc.?
  5. Do you have a corporate bank account, use business invoices in the corporate name and maintain corporate books and records?
  6. Do you have a written contract engaging your business? Is it for a fixed term period or completion of a project?
  7. Do you have the ability to determine how the services are provided?
  8. Have you invested his or her own financial resources into their business?
  9. Is there risk of loss or financial loss if the services are not successfully completed?

The answers to these questions will also help employers and agencies assess an individual’s status. There are numerous others that will have to be asked to help ascertain answers for all parties and ensure against employee misclassification. And just as important, independent contractors will need to be prepared to self-assess. Those who wish to be independent incorporated contractors should seek advice. Govern yourself as a business would and avoid acting or being treated as an employee.

Quick Poll Results: Taking Steps to Prove Independence

Being able to distinguish yourself as an independent contractor as opposed to an employee has been an ongoing issue in our industry for years. Sometimes certain headlines and trends bring it to the front-line of concerns and that’s exactly what happened when the Ontario Government’s Bill 148 became law in late 2017.

As the topic regained popularity and concerns once again grew relevant, we decided to ask our readers to review what they’re doing to protect themselves and make it part of our February quick poll and the results are positive. Although there is no single step that every independent contractor takes, it’s clear that many professionals are already doing some great things!

Quick Poll Results: How do you show that you're an independent contractor?

Contractor Quick Poll: Are you really an independent contractor?

For nearly 10 years now, the CRA has been paying close attention to independent contractors’ employment statuses and performing audits to determine if they should be deemed Personal Services Businesses (PSBs). Independent contractors across Canada quickly learned the importance of taking steps to protect their independent business status, or else suffer the tax consequences. Recently, the Ontario Government passed Bill 148 that, among many things, will also put a spotlight on independent contractors’ business habits.

This makes today a good time to assess how well you’re doing at ensuring that your independent contracting business is in fact considered a business. This month’s contractor quick poll helps with just that as it includes some basic actions you can take to separate yourself from your clients’ employees. As usual, we strongly recommend you seek legal advice to ensure you’re taking all the proper steps.

2017 in Review: Independent Contracting

2017 in Review: Independent ContractingAt the core of the Talent Development Centre is our desire to help independent contractors gain more opportunities and be more successful in their business. That is this blog’s mission. So, when summarizing a year, it’s only natural to review some of the most popular posts on the topic.

First, there’s the business of independent contracting…

Another part of being a contractor is working with staffing agencies. In many cases, it’s inevitable. Here are a few tips to help the relationship go smoothly…

There’s One Simple Way to Thrive as an Independent Contractor

There's One Simple Way to Thrive as an Independent ContractorWe repeatedly say throughout the Talent Development Center that “Independent contracting isn’t for everybody” and “There are things you should know before taking the leap.”  While it’s not intended, this can make new IT professionals nervous to making that leap, as it makes the change seem daunting and overwhelming.

The truth is, becoming an independent contractor does require extra work but it does not have to be scary. There is one very simple way to ensure you are successful: Don’t do it alone. Of course, that encompasses many small items like engaging a lawyer and accountant, working closely with recruiters, and attending learning from experienced contractors who have already been through the hurdles.

We recently came across this article that Melissa Thompson, an accomplished entrepreneur, wrote for Inc. about freelancing. In it, she provides advice based on her experience to help contractors get hired. She lists four specific tips:

  1. Freelancers need to take initiative
  2. Networking is still important
  3. Build an outstanding profile
  4. Be prepared for variable income

You can read the article here for all of the details on the advice. Or, if you’re already an experienced and successful freelancer, could you add anything else? If so, please share it in the comments below.

Do You Have these Traits of a Great Freelancer? Take the Quiz!

Do You Have these Traits of a Great Freelancer? Take the Quiz!There are certain jobs that are more active in the gig economy. Obviously technology contractors form a big part of it, and so do writers, graphic designers and carpenters. It is a massive trend beneficial for many; however, freelancing and independent contracting is not for everyone. In many ways, it requires a person with strengths in various areas.

According to this article from moneyguru, there are 10 traits every great freelancer has:

  1. Time Management
  2. Sociability
  3. Skin like a rhinoceros
  4. Little need for sleep
  5. A headful of ideas
  6. Adaptability
  7. Marketing savvy
  8. Patience
  9. Time alone
  10. Multitasking

Based on past articles published to the Talent Development Centre, it is clear that we agree with each of these traits, and we believe some are more important than others depending on the industry, role and client.

In addition to explaining the traits further, moneyguru’s article also provides a fun quiz you can take to see if you possess the right mix of what it takes to be a freelancer. You can take the quiz here. We don’t recommend taking the results to seriously, but it’s a nice starting point to understand your personal situation.

Bookkeeping 101 for Independent Contractors

Perhaps the biggest challenge of taking the leap from being a full-time IT employee to an independent technology contractor is learning the ins and outs of running your business. While your prime responsibility continues to be delivering on your IT projects, you can’t ignore your accounting and tax obligations.

If you’re considering a change, don’t be intimidated by the administrative work that comes along with the countless benefits of working for yourself. Instead, take a breath and watch this video from Dice to get some helpful bookkeeping tips for those starting out in the contracting world.