At Rutherford Cross Interim we work in partnership with our clients and candidates to find the best way to engage Senior Finance specialists for a wide variety of interim vacancies.
Whether the engagement is via a day rate or a salaried fixed term contract can depend on a number of factors, and we thought it could be valuable to share our insights in this area. Director and interim specialist, Derek Lauder, discusses which option works best in different scenarios below.
The benefits of day rate assignments and the best circumstances to opt for this model:
- When the assignment is short term or when the duration is difficult to determine
- If a company has a headcount freeze but there is an essential skills gap requirement
- It offers both the client and contractor greater flexibility on days worked and notice periods
- When a very quick start is required. There is typically less paperwork for the hiring client, allowing for a ‘tomorrow’ start date
- The pre-employment checks for day rate workers, such as right to work in the UK, references and qualification checks are collected by the agency
- It gives the hiring company access to a number of high-quality candidates who enjoy the independence that working through a day rate offers them, compared to being an employee
- Using the IR35 CEST Tool is straightforward with circa 25% of assignments landing outside, allowing the contractor to use their Ltd Co. For PAYE Day Rate assignments, ensuring compliance with AWR is also easy if you are working with the right agency partner
- Generally there is a higher level of assignment completion
Expanding on the last point, at Rutherford Cross we found statistically higher assignment completion in 2022 when the engagement was through day rate (95%) compared to salaried fixed term contracts (90%).
With day rate, the agency communication with both the contractor and client tends to be more regular, and this can be beneficial for addressing any minor issues before they become significant. We believe this contributes to the higher completion rates on these types of assignments.
The benefits of fixed term contracts and the best circumstances to opt for this model:
- When the duration is known to be long term, such as 1 year or longer
- The business engages the temporary worker as an employee which allows the contractor to access company benefits including pension, car allowance, health insurance etc. It is worth bearing in mind that the value of these benefits is often included in the day rate figure to ensure the contractor is not worse off by going down the day rate route
- The FTC employee will have the same notice period as their permanent colleagues. It is possible to lengthen the notice period for day rate workers if both parties are in agreement, so notice periods shouldn’t be the deciding factor
Recruiting a fixed term contract can be risky if you are paying a fee to an agency up front and the candidate leaves partway through an assignment, especially if the duration is out with the guarantee period.
At Rutherford Cross, we have an almost 50/50 split between day rate and FTC, and we will always support our client and candidate to reach an outcome that works best for both parties; often dependent on a number of the factors listed above.
If you are looking to hire any specialist Senior Finance interims or you are looking for a new interim position yourself, please do not hesitate to contact our interim team here at Rutherford Cross:
Senior Appointments – [email protected]
East of Scotland – [email protected]
West of Scotland – [email protected]