QUESTION: Can you talk about the structure of an interim contract? What are the general terms? What if they want to convert from full time? Is there a conversation clause? Any help on this is welcome. – Jon, Philadelphia, PA
ANSWER: Yes, yes, yes. I know you really well, Jon, and I know you do not do interim that often. I would get a hold of People 2.0 because they will fund the payroll. Even if you can afford to fund the payroll, think about whatever you are going to pay this contractor, and make sure the record-keeping is right. These companies will do all that for you.
I think they will take a percentage, but they will pay the payroll taxes, they will run the payroll, and they will send you the excess money. Worst case, even if you do not use them, the people in both organizations are fantastic human beings. Tell them what your situation is. They will help you engineer it based on the specific situation.
Generally, depending on the position, it is a 50% to 80% gross markup of what you are paying the individual. There are conversion clauses all over the place. So, for the purpose of this call, if they hire the person in the next 30 days they might pay 15%. If they hire them in 4 or 5 months, maybe they pay 5% or 10%, and that is all negotiable.
Generally, the terms are net 30, net 45 on the client side and you have got to start paying the person every 2 weeks. That is why I generally recommend outsourcing it. I believe People 2.0 and Top Echelon have a great perk, if the client does not pay you, they still absorb the loss, meaning they are going to remove a huge financial liability. Tell them I said to call. Both people I know really well, and they will probably take a little bit better care of you.
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