I've been programming for around 10 years and working at it (W2) for 8 or so. I've had quite a few jobs. I am sometimes asked if I want to work as a contractor or as an employee and I have always said "employee" mainly because I've always done that. I figured I could probably easily take those jobs on a contract basis and figured that someday I'd have to (or even want to) but that day hasn't come until today.
A recruiter got my resume off an employment recruitment site and has been lining me up for a position at one of their client companies and yesterday I was told that the decision has been made that I get the job. I am to be paid on an hourly basis as a contractor. They emailed me papers to sign yesterday. Generally, when I sign preemployment papers I scan them and sign, have a general idea what it's about, the legalese notwithstanding. Since I was at home this time, at my "leisure," I took the time to read this stuff carefully. Most of it looks pretty OK, although I'm rather inexperienced at this, obviously. There's a nondisclosure agreement, a W9 form - pretty standard stuff. Then there's the 5 page contract with an "Exhibit A" tacked onto that, being a purchase order for my services. That's a bit weird from my perspective, but probably standard, I figure. It states my hourly rate, basically, with a sentence or two with yet another guarantee by me that I won't make any agreements with the 3rd party for a year after the completion of my assignment, things of that nature. In the contract they want me to guarantee that if I do start working directly with their client, I will fork over 20% of my salary. I guess I'm OK with signing on that. However when I got to paragraph 12 in the contract, I did a double take:
12. INSURANCE. Contractor will obtain for itself and its personnel before providing services, at its own expense, comprehensive General Liability insurance coverage for projects covered by this Agreement, for limits of liability not less than $500,000 and will name <insert name of recruiter here> as an Additional Insured, provide a copy of the binder and policy to <insert name of recruiter here>, and hold <insert name of recruiter here> harmless for any damages or expenses, including attorney's fees, incurred as a result of misconduct of Contractor or its personnel involving <insert name of recruiter here>, the TPU (third party unit), or any customer of client of the TPU.
Now, that's something I wasn't prepared for and I figure I'll be calling them first thing in the morning - their office won't be opening for at least 3 hours. You people with experience, can you tell me what this is about? Are they going to waive this for me? I can't believe that they recruited me with the assumption that I already have an insurance policy of this nature and didn't ask me up front. I'm a computer programmer, and they were careful to check out my references before making me the offer. In the past, the trust inherent in that type relationship has floated my boat.
Please, in addition to answering that specific question, can I get some tips and hints to give me a more solid footing in embarking on my first gig as a contractor? I've had quite a few contractor-like assignments, but never actually been on a contract basis. I always figured it was going to be principally a matter of filling out some different or extra IRS forms, but I guess there's more to it. For one thing, it looks like I'm going to have to manage my own withholding of federal and state taxes and SS. Do I do that at tax time or do I have to manage that during the work year? This job is 6 months+ (I'm told it's funded for a year, possibly with extensions) but I will be on a trial basis, especially at the start. The TPU is contractually entitled to send me home for any reason at any time. The contract seems to carefully stipulate that I'm entitled to zero benefits, just my hourly rate with no possibility of extra compensation for overtime, no possibility of being compensated for training of any kind, etc. Thanks for any help.
A recruiter got my resume off an employment recruitment site and has been lining me up for a position at one of their client companies and yesterday I was told that the decision has been made that I get the job. I am to be paid on an hourly basis as a contractor. They emailed me papers to sign yesterday. Generally, when I sign preemployment papers I scan them and sign, have a general idea what it's about, the legalese notwithstanding. Since I was at home this time, at my "leisure," I took the time to read this stuff carefully. Most of it looks pretty OK, although I'm rather inexperienced at this, obviously. There's a nondisclosure agreement, a W9 form - pretty standard stuff. Then there's the 5 page contract with an "Exhibit A" tacked onto that, being a purchase order for my services. That's a bit weird from my perspective, but probably standard, I figure. It states my hourly rate, basically, with a sentence or two with yet another guarantee by me that I won't make any agreements with the 3rd party for a year after the completion of my assignment, things of that nature. In the contract they want me to guarantee that if I do start working directly with their client, I will fork over 20% of my salary. I guess I'm OK with signing on that. However when I got to paragraph 12 in the contract, I did a double take:
12. INSURANCE. Contractor will obtain for itself and its personnel before providing services, at its own expense, comprehensive General Liability insurance coverage for projects covered by this Agreement, for limits of liability not less than $500,000 and will name <insert name of recruiter here> as an Additional Insured, provide a copy of the binder and policy to <insert name of recruiter here>, and hold <insert name of recruiter here> harmless for any damages or expenses, including attorney's fees, incurred as a result of misconduct of Contractor or its personnel involving <insert name of recruiter here>, the TPU (third party unit), or any customer of client of the TPU.
Now, that's something I wasn't prepared for and I figure I'll be calling them first thing in the morning - their office won't be opening for at least 3 hours. You people with experience, can you tell me what this is about? Are they going to waive this for me? I can't believe that they recruited me with the assumption that I already have an insurance policy of this nature and didn't ask me up front. I'm a computer programmer, and they were careful to check out my references before making me the offer. In the past, the trust inherent in that type relationship has floated my boat.
Please, in addition to answering that specific question, can I get some tips and hints to give me a more solid footing in embarking on my first gig as a contractor? I've had quite a few contractor-like assignments, but never actually been on a contract basis. I always figured it was going to be principally a matter of filling out some different or extra IRS forms, but I guess there's more to it. For one thing, it looks like I'm going to have to manage my own withholding of federal and state taxes and SS. Do I do that at tax time or do I have to manage that during the work year? This job is 6 months+ (I'm told it's funded for a year, possibly with extensions) but I will be on a trial basis, especially at the start. The TPU is contractually entitled to send me home for any reason at any time. The contract seems to carefully stipulate that I'm entitled to zero benefits, just my hourly rate with no possibility of extra compensation for overtime, no possibility of being compensated for training of any kind, etc. Thanks for any help.