How much to charge per hour?

[marisam]

I quit my old job (sql, crystal reports, access, content management, database etc.) in July. I now have a new job. Recently I've been contacted by employer to be a consultant. They want to pay me at the same rate I was being paid which was $27. They also want me to come in on evenings and weekends if possible.

I've never had this happen to me before. I don't mind working extra hours to make more money. The problem is do I want to accept the old rate or request more per hour. I mean I would be giving up my personal time to work. Should I ask for a few dollars more per hour? How much more is reasonable? I'm not sure how to go about this.




Any advice would be appreciated.

 

[mrdenny]

Keep in mind that when you consult you will be getting a 1099 and you will be responsible for all taxes comes next April. If they are going to have you on as a regular part time employee where they pay your taxes then taking your normal rate could be fine. However if they aren't you'll be responsible for the full ~42% tax rate instead of just the normal ~21% which W2 employees pay (when you are employeed under a W2 your employeer is actually responsible for the other ~21%).

If your former employeer has asked you to keep working for them on contract they need your assistance. It wouldn't be out of line for you to ask for a little more money. Especially if you will be working as a 1099 contractor (which most contractor/consultants work under). If you are going to be working under a 1099 be sure to add an extra 21% for taxes. If they balk give them the option of bringing you back on as a part time W2 employee.

As a contractor they also get to save a little money as they don't need to pay for benifits (medical, dental, etc) as well as STD and LTD insurance. There's no reason that you shouldn't get this money instead of them just keeping it.

Denny
MCSA (2003) / MCDBA (SQL 2000)
MCTS (SQL 2005 / Microsoft Windows SharePoint Services 3.0: Configuration / Microsoft Office SharePoint Server 2007: Configuration)
MCITP Database Administrator (SQL 2005) / Database Developer (SQL 2005)

--Anything is possible. All it takes is a little research. (Me)

http://www.mrdenny.com

 

[marisam]

Thanks for the advice. I'm going to ask for a few more dollars.

 

[JCreamerII]

marisam,

I would ask for more than a few more $'s. Tell them you would work for the same net $'s plus a little bump up. Let them know that you are responsible for their protion of all the taxes if you work independently for them. It is quite a big hit as mrdenny illustrated. Tell them that you would be ammenable to the work, you just don't want to be doing it for less than you would if you were still working directly for them, and that you think your worth more than you were getting anyway.

Jim C.

 

[aarenot]

3 times what they paid you is about the minimum standard for doing it as a consultant. Outside consulting firms would charge 5 times what your pay was. Also, as a consultant you will send an invoice, and they will take 30, 60, 90, or 180 days to pay you unless you negotiate a different pay contract.