Being an independent contractor has its benefits, but it’s a common misconception that you’re financially better off with the attractive day rates you can command as a contractor. When you consider the expenses of running your own business, gaps in earning periods, unpaid sick and holiday leave, and missing out on countless other company benefits like pension plans, the real cost-benefit analysis between permanent employment and being a contractor can surprise you!
Here’s why Alan and Nigel traded independent consulting for permanent roles at CGI and couldn’t be happier.
We work with a lot of independent consultants at CGI and for some, being a free agent suits their lifestyle. However, it’s a common misconception that pay-wise, you’re always better off contracting than taking on a permanent role. Independent rates are indeed attractive, but when you weigh up the employee benefits at a company like CGI, you’d be surprised how often the maths ends up equalling out.
Factor in things like annual leave, sick leave, pension plans and no earning gaps – not to mention the mountain of career support, opportunities and other perks our members enjoy – and you’re generally in a pretty similar financial position to (if not better than) contracting. Plus it’s fair to assume life’s a lot less stressful when you’re not always worrying about where the next month’s pay is coming from!
Variety, challenge and reward
Alan Dickinson, a Programme Director at CGI with a long history in software engineering and project management (in his earlier days he helped to write PRINCE2!), spent many years as an independent consultant before he joined CGI.
Alan wrestled with the notion of settling full-time with one employer, in part because he was afraid he’d miss the diversity of being a contractor. But since becoming a CGI member in 2017, he’s found the opposite true.
“At CGI, I’ve worked in energy (smart meter implementation programme), local and central Government and a corporate assurance function role,” says Alan. “ And they have been some of the most challenging and rewarding roles of my career”.
Nigel Bell, Director Consulting Services, is similarly pleased with his decision to leave his independent consultancy behind for the security and fulfilment of life at CGI.
“I’ve undertaken diverse roles in my career, both client and supplier side,” he tells us. “I worked in the NHS and across Central Government, then spent 10 years as an independent consultant. In all my roles, I have been a change leader at the interface between technology and business.”
“When I was independent, I was often approached by companies about ‘going permanent’ but I resisted on the basis that I enjoyed the mix and moreover, that I perceived my earnings as being far higher as a contractor.”
However, it took a conversation with a friend who worked in contract recruitment to change things. Nigel’s friend made him see that a permanent job at CGI would leave him in the same financial position he was in as a contractor, with the addition of security and a host of other broader employment benefits.
“He said to me, ‘Do the maths, Nigel!’”
The ‘lightbulb’ moment
Becoming a CGI member clicked for Alan after working with CGI on a client-facing programme. Alan recalls “the CGI team was fantastic – very professional and capable and the sense of ‘team’ and support was brilliant. I felt very much part of ‘it’, which I hadn’t experienced in other contracting roles.”
When he was approached about joining, he explored the ins and outs. “Clearly there is a different financial model to consider, but that isn’t simply comparing the salary to contracting fees. There is so much more to ensure a fair comparison, and when I realised all the benefits of life at CGI, I was convinced it was the right thing for me.”
For Nigel, it was seeing that a permanent role at CGI would provide the same variety he loved as a contractor, security, great colleagues, and the chance to see programmes through from start to finish.
“There’s a satisfaction that comes with that,” he explains. “Too often, I had been coming in late to rescue things that had gone wrong, or missed out on seeing the organisation reap the benefits of the change I’d helped to shape and implement.”
He continues: “Whatever my bank balance, I always found it difficult to relax into the gaps between roles; in theory, I had the luxury of being able to pick and choose my roles but the reality was that I needed to take on whatever roles became available during a window of time.”
As Nigel says, it’s easy to look at your day rate and kid yourself you’re earning more as a contractor. “But you’d have to be lucky to have your next contract lined up to start the day after your previous one ends. And every day between contracts is an unpaid one.”
Then there are the annual leave policies which let you take breaks or go on holiday, being paid throughout, and pensions which we make meaningful contributions to at CGI – it’s not just down to you to put aside savings for your retirement.
“So if it’s the money that’s making you hesitate over taking on a role you’d otherwise love,” Nigel continues, “don’t let that stop you. It tends to even out.”
Alan agrees. “I would add the costs of running a small business too. I had to pay for professional indemnity, accountants, solicitors, my own equipment and utilities, and travel expenses getting to clients.”
‘Belonging’ is a powerful thing
Being an independent entity certainly has its place, but for our people at CGI, being part of a collective force is something special.
CGI is a real community. Almost every member owns shares in the business and although we’re a very diverse workforce, our goals are shared. We’re all working together on projects that make big impacts on important areas, and there’s an enormous sense of team spirit and pride in our achievements.
“The senior management team certainly makes me feel like a valued member of the team, with feedback, involvement in decision making outside my direct remit and small gifts at key points,” Alan says. “Further to that, there’s a lot of choice in terms of roles, and encouragement to learn and develop with many courses (including online) available.”
Ultimately, the support available and opportunities inherent in a company of our size are hard to beat.
“I think there is something much softer that’s about being part of a team that does such great things and gives ‘you’ opportunities that just aren’t available when you’re independent,” Alan explains..
“Being a member of CGI has been enlightening; after so many years being independent or with small consultancies, the support mechanisms and sense of the greater team has been amazing. It brought a sense of belonging I hadn't had for a long time.”
“It's great being part of something bigger,” Nigel says. “I still don't always know how to find the person who is a specialist in X, but I now know who to talk to who can help me find that person. I play in position, as team players do, but can also flex around my core role to address the needs of my client or support my colleagues. I love having people around me who can help shape ideas and client propositions and inform broader conversations with the client.”
“I have absolutely no regrets about making the switch to full-time member at CGI. And if you’re struggling to decide which way to go because you’re having those financial concerns like I had, you know what to do – do the maths!”
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