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Hays email blunder exposes high RBS contractor pay rates

36 points by Netadmin 15y ago

arethuza 15y ago
I'm willing to bet that the contractor getting paid £2000 a day was probably updating their Hyperion HFM rules - a black art if there ever was one.
- ra 15y ago
  For a consultant who offers professionalism, experience and a truly in-demand or rare set of skills, 2k / day isn't anything out of the ordinary.
  - arethuza 15y ago
    Indeed, I bet RBS don't get many lawyers charging them as little as £2000 a day.
  - Silhouette 15y ago
    For software contractors, in the UK, 2k/day would not only be out of the ordinary, it would be about twice what I've previously heard of anyone getting, and that includes a few people who work for the kinds of project that traditionally pay serious money: banking in the City, defence with clearances/specialist skills, etc. etc. The article doesn't say who is getting those rates, but if it's the software guys then I'm guessing we're talking about a very small number of isolated cases, where probably either someone had them over a barrel with knowledge of a critical project that was otherwise going to be lost or someone knew where the skeletons were buried. Either way, management made the expensive screw up a long time ago...
    - corin_ 15y ago
      I've heard of higher daily rates in a couple of industries here in the UK, but not commonly.
    - arethuza 15y ago
      Hyperion HFM rules are both fairly logically complex (manipulation of 12 dimensional data), usually associated with fairly arcane financial requirements that only apply to large companies and, as a final wonderful touch, implemented as dirty great lumps of ulta-conditional VBScript. This is not a pleasant combination.
      - Silhouette 15y ago
        > as a final wonderful touch, implemented as dirty great lumps of ulta-conditional VBScript. Sounds like the people implementing them don't deserve £200/day, never mind £2,000! :-) Seriously, though, nothing you wrote there sounds particularly impressive when you look at what plenty of very smart, very skilled, very well trained contractors do for daily rates in three figures. I'd guess that in the UK today, the middle of the bell curve for software contracting rates is probably in the £30-£50/hour or £250-400/day region. With specialist skills/relevant experience you can get higher, and in London you generally shift everything upwards a bit as well, so for something like banking in the City you might be looking at £600-800/day. Even in London, in a generally high-paid industry, with specialist skills and experience, you're still an outlier if you're approach £1,000/day though. I know absolutely nothing about Hyperion HFM rules, but I find it hard to believe anything could be so difficult to learn and work with that you couldn't get someone capable of doing those other jobs to learn it and do it for half the rate we're talking about. Is there some sort of artificial barrier that stops otherwise capable software contractors from moving into the field? [Edit: The PCG's benchmark report from June this year had the middle of the curve around £300-500/day or £60k-100k turnover, with the middle of the respondents curve around ages 35-55 and IT making up the majority of responses and fitting the turnover curve pretty well when isolated. That's based on self-selected respondents who are members of a professional organisation, and certainly tending to the more experienced age ranges, so I think it's fairly consistent with my guess above. They did indicate a small number of responses with turnover above £200k, and even some with turnover in the £300k-500k range. There is no way to tell whether those correspond to the respondents whose businesses had more than one fee earner (10% of the total).]
        arethuza 15y ago
- patio11 15y ago
  My understanding is that it would be on the high end up not unheard of for various security-related services, too. What are you going to do next time you lose a database, say "Oops, sorry, we were going to use the best available firm but we decided to save 5k quid and then..."
- jedc 15y ago
  Most employers (particularly banks) are perfectly fine paying contractors a significant premium, since it gives them a flexibility to end their contracts quickly and without a hassle. Particularly compared to what they have to do in order to make employees redundant...
Powerscroft 15y ago
In house IT staff are getting made redundant while this is going on. Contractors deserve to get what the market will pay - but it doesn't say much about planning and skills development at RBS does it.
- ig1 15y ago
  Contracting staff don't tend to cost companies much more than direct employee staff (the difference is typically <20%) - the big difference is that companies have to provide employees benefits,national insurance, pensions, holidays, sick pay, bonuses etc whereas for contractors they just get the monetary equivalent. At RBS this is particularly significant as they have some of the best non-financial employee benefits in the financial sector. The ability to hire/fire contractors at will makes the 20% premium well worth it for companies, especially when those skills are only need for a short time period or for particular projects.
  - arctangent 15y ago
    It probably looks good on paper for companies but there are often some hidden pitfalls. Firstly, the options appraisal around whether to increase headcount or to get in a "temporary" consultant are highly sensitive to estimates about how long a piece of work will take to do and how much ongoing support would be required afterwards. If the estimates are optimistic then it might actually have made more sense to hire a permanent employee. Secondly, there is often a motivation hit when contractors are brought in. If the contractor is brought in solely to increase a team's capacity (rather than to bring in skills that a team lacks) then the permanent members of staff will be all too aware that the person sitting at the next desk is making twice as much (or more!) for doing the exact same job.
    - ig1 15y ago
      Even if you're using contractors on a long term basis the premium can be worth it if you're in industry which goes through contractions so you can get rid of staff when you want to. Like I said the actually premium is relatively small for companies, and it's much easier to replace a contractor with a employee than vice versa if you need to. I've worked at a few companies with mixed contractor/employee teams where it hasn't been an issue, after all there's nothing stopping the employees from becoming contractors if they prefer that lifestyle and it aligns with their long term goals.
perfunctory 15y ago
I wonder how much of those £2,000 went to actual contractors, after the agency margin that is.
mattmillr 15y ago
"We are working with RBS to recover the data from recipients where possible." Is there some business or legal necessity for making statements like this? When I've got my geek hat on, this seems like an incredibly stupid statement that betrays a fundamental misunderstanding of the nature of data. What am I missing?
- ig1 15y ago
  I thought that as well, it's pretty poor journalism that a technology magazine didn't pick up on that. But saying that it's pretty bad journalism anyway in that they're using an extreme data point and implying it was representative of the entire data set when it obviously isn't.
forgotAgain 15y ago
“We are working with RBS to recover the data from recipients where possible.” How exactly do you recover emailed data?
- a3camero 15y ago
  Delete it from people's mailboxes on Exchange? Some people maybe don't check their email frequently...
- a3camero 15y ago
  Delete it from people's mailboxes on Exchange? Some people maybe don't check their email frequently... I'm not saying it isn't a stupid comment but there's probably a bit of a reason for why they said that.
whyleyc 15y ago
Does anyone know if the source email has been posted anywhere on the InterWebs ?
ilcavero 15y ago
The only outrage here is that a tax-payer funded entity is outraged because its payroll details were leaked. Don't I have the right to know how my taxes are spent? (supposing I was Scottish)
- arethuza 15y ago
  The whole of the UK bailed RBS out (not to mention HBOS).
- ig1 15y ago
  RBS is a publicly listed company, like any other listed company you can just have a look at their annual accounts to see how much money they spent on staffing.
bankingtech 15y ago
The rates of £2k per day are most likely for finance workers in the front or middle office – these are not tech contractors. Nowhere in the article does it state that they are anything to do with the technology department. From that perspective, £2k per day is a less surprising figure given that the permanent staff in these areas can easily earn £300k - £500k + depending on the role.
- MortenK 15y ago
  It might very well be tech contractors. For people with specialized skills (not your typical .NET, PHP, RoR guy) who contract on stuff like SAP or similar, it is definitely not unheard of, to have a rate of £2K for a 8 hour working day. Especially not if you are in the banking / financial services sector.
tlianza 15y ago
Assuming this wasn't some sort of kickback, doesn't the willingness to pay contractors £2k per day while shedding full-timers suggest that there is something absolutely crippling about the terms for full time employment? Is it regulation?
- ig1 15y ago
  I imagine at that price point either: 1) The skill set is rare enough that the only choice for the company is to hire a contractor 2) The company only needs the skill-set for a short period of time, i.e it doesn't make sense to hire someone who'll cost 300k/year when you only really need them for three months
gte910h 15y ago
2000 pounds a day (for say, a 12 hour day) would come out to about $273 USD an hour. That's not inconceivable, especially for a non-technical business contractor.

36 points by Netadmin 15y ago

I'm willing to bet that the contractor getting paid £2000 a day was probably updating their Hyperion HFM rules - a black art if there ever was one.

ra 15y ago
For a consultant who offers professionalism, experience and a truly in-demand or rare set of skills, 2k / day isn't anything out of the ordinary.
- arethuza 15y ago
  Indeed, I bet RBS don't get many lawyers charging them as little as £2000 a day.
- Silhouette 15y ago
  For software contractors, in the UK, 2k/day would not only be out of the ordinary, it would be about twice what I've previously heard of anyone getting, and that includes a few people who work for the kinds of project that traditionally pay serious money: banking in the City, defence with clearances/specialist skills, etc. etc. The article doesn't say who is getting those rates, but if it's the software guys then I'm guessing we're talking about a very small number of isolated cases, where probably either someone had them over a barrel with knowledge of a critical project that was otherwise going to be lost or someone knew where the skeletons were buried. Either way, management made the expensive screw up a long time ago...
  - corin_ 15y ago
    I've heard of higher daily rates in a couple of industries here in the UK, but not commonly.
  - arethuza 15y ago
    Hyperion HFM rules are both fairly logically complex (manipulation of 12 dimensional data), usually associated with fairly arcane financial requirements that only apply to large companies and, as a final wonderful touch, implemented as dirty great lumps of ulta-conditional VBScript. This is not a pleasant combination.
    - Silhouette 15y ago
      > as a final wonderful touch, implemented as dirty great lumps of ulta-conditional VBScript. Sounds like the people implementing them don't deserve £200/day, never mind £2,000! :-) Seriously, though, nothing you wrote there sounds particularly impressive when you look at what plenty of very smart, very skilled, very well trained contractors do for daily rates in three figures. I'd guess that in the UK today, the middle of the bell curve for software contracting rates is probably in the £30-£50/hour or £250-400/day region. With specialist skills/relevant experience you can get higher, and in London you generally shift everything upwards a bit as well, so for something like banking in the City you might be looking at £600-800/day. Even in London, in a generally high-paid industry, with specialist skills and experience, you're still an outlier if you're approach £1,000/day though. I know absolutely nothing about Hyperion HFM rules, but I find it hard to believe anything could be so difficult to learn and work with that you couldn't get someone capable of doing those other jobs to learn it and do it for half the rate we're talking about. Is there some sort of artificial barrier that stops otherwise capable software contractors from moving into the field? [Edit: The PCG's benchmark report from June this year had the middle of the curve around £300-500/day or £60k-100k turnover, with the middle of the respondents curve around ages 35-55 and IT making up the majority of responses and fitting the turnover curve pretty well when isolated. That's based on self-selected respondents who are members of a professional organisation, and certainly tending to the more experienced age ranges, so I think it's fairly consistent with my guess above. They did indicate a small number of responses with turnover above £200k, and even some with turnover in the £300k-500k range. There is no way to tell whether those correspond to the respondents whose businesses had more than one fee earner (10% of the total).]
      - arethuza 15y ago
patio11 15y ago
My understanding is that it would be on the high end up not unheard of for various security-related services, too. What are you going to do next time you lose a database, say "Oops, sorry, we were going to use the best available firm but we decided to save 5k quid and then..."
jedc 15y ago
Most employers (particularly banks) are perfectly fine paying contractors a significant premium, since it gives them a flexibility to end their contracts quickly and without a hassle. Particularly compared to what they have to do in order to make employees redundant...

Powerscroft 15y ago

In house IT staff are getting made redundant while this is going on. Contractors deserve to get what the market will pay - but it doesn't say much about planning and skills development at RBS does it.

ig1 15y ago
Contracting staff don't tend to cost companies much more than direct employee staff (the difference is typically <20%) - the big difference is that companies have to provide employees benefits,national insurance, pensions, holidays, sick pay, bonuses etc whereas for contractors they just get the monetary equivalent. At RBS this is particularly significant as they have some of the best non-financial employee benefits in the financial sector. The ability to hire/fire contractors at will makes the 20% premium well worth it for companies, especially when those skills are only need for a short time period or for particular projects.
- arctangent 15y ago
  It probably looks good on paper for companies but there are often some hidden pitfalls. Firstly, the options appraisal around whether to increase headcount or to get in a "temporary" consultant are highly sensitive to estimates about how long a piece of work will take to do and how much ongoing support would be required afterwards. If the estimates are optimistic then it might actually have made more sense to hire a permanent employee. Secondly, there is often a motivation hit when contractors are brought in. If the contractor is brought in solely to increase a team's capacity (rather than to bring in skills that a team lacks) then the permanent members of staff will be all too aware that the person sitting at the next desk is making twice as much (or more!) for doing the exact same job.
  - ig1 15y ago
    Even if you're using contractors on a long term basis the premium can be worth it if you're in industry which goes through contractions so you can get rid of staff when you want to. Like I said the actually premium is relatively small for companies, and it's much easier to replace a contractor with a employee than vice versa if you need to. I've worked at a few companies with mixed contractor/employee teams where it hasn't been an issue, after all there's nothing stopping the employees from becoming contractors if they prefer that lifestyle and it aligns with their long term goals.

perfunctory 15y ago

I wonder how much of those £2,000 went to actual contractors, after the agency margin that is.

mattmillr 15y ago

"We are working with RBS to recover the data from recipients where possible." Is there some business or legal necessity for making statements like this? When I've got my geek hat on, this seems like an incredibly stupid statement that betrays a fundamental misunderstanding of the nature of data. What am I missing?

ig1 15y ago
I thought that as well, it's pretty poor journalism that a technology magazine didn't pick up on that. But saying that it's pretty bad journalism anyway in that they're using an extreme data point and implying it was representative of the entire data set when it obviously isn't.

forgotAgain 15y ago

“We are working with RBS to recover the data from recipients where possible.” How exactly do you recover emailed data?

a3camero 15y ago
Delete it from people's mailboxes on Exchange? Some people maybe don't check their email frequently...
a3camero 15y ago
Delete it from people's mailboxes on Exchange? Some people maybe don't check their email frequently... I'm not saying it isn't a stupid comment but there's probably a bit of a reason for why they said that.

whyleyc 15y ago

Does anyone know if the source email has been posted anywhere on the InterWebs ?

ilcavero 15y ago

The only outrage here is that a tax-payer funded entity is outraged because its payroll details were leaked. Don't I have the right to know how my taxes are spent? (supposing I was Scottish)

arethuza 15y ago
The whole of the UK bailed RBS out (not to mention HBOS).
ig1 15y ago
RBS is a publicly listed company, like any other listed company you can just have a look at their annual accounts to see how much money they spent on staffing.

bankingtech 15y ago

The rates of £2k per day are most likely for finance workers in the front or middle office – these are not tech contractors. Nowhere in the article does it state that they are anything to do with the technology department. From that perspective, £2k per day is a less surprising figure given that the permanent staff in these areas can easily earn £300k - £500k + depending on the role.

MortenK 15y ago
It might very well be tech contractors. For people with specialized skills (not your typical .NET, PHP, RoR guy) who contract on stuff like SAP or similar, it is definitely not unheard of, to have a rate of £2K for a 8 hour working day. Especially not if you are in the banking / financial services sector.

tlianza 15y ago

Assuming this wasn't some sort of kickback, doesn't the willingness to pay contractors £2k per day while shedding full-timers suggest that there is something absolutely crippling about the terms for full time employment? Is it regulation?

ig1 15y ago
I imagine at that price point either: 1) The skill set is rare enough that the only choice for the company is to hire a contractor 2) The company only needs the skill-set for a short period of time, i.e it doesn't make sense to hire someone who'll cost 300k/year when you only really need them for three months

gte910h 15y ago

2000 pounds a day (for say, a 12 hour day) would come out to about $273 USD an hour. That's not inconceivable, especially for a non-technical business contractor.