Perm doesn’t exist
I’m sorry to burst your bubble, but there is no such thing as a “permanent” job position, especially in Illinois, and contract to hire offers several important benefits over perm positions.
Get real
In the state of Illinois especially, an employer is under no obligation to keeping you employed, you can be laid off or terminated for any reason related to your performance or not. Even the placement fee that your IT recruiter will receive is usually under 60-180 days guarantee period, to minimize their loses in case of separation in that period… What does that tell you?
Make it work
Some people worry about health benefits, PTO and eligibility for unemployment. I agree that most staffing companies who would host the contract to hire, would not provide the best health insurance rates (if any) and may not offer any PTO. However these “benefits” can be easily converted to dollars and cents. You should take this into consideration and negotiate an hourly rate that would cover health insurance and time off. Since you will actually be paid for every hour you put in, if the benefits to dollars conversion is done correctly, you should come out on top! Also note that being a 2W contractor makes you eligible for unemployment, if things don’t work out.
Reap the benefits of contract-to-hire:
- Evaluate the job firsthand. You’ll be able to see for yourself what working for the company is like instead of relying the impression you made after a few interviews. You can assess your chances of growth, likelihood of getting along with your boss, or if you can learn form your peers. In other words you will get to have a courtship period before the wedding, verses marriage after 2 dates!
- Contract to hire position gives you an advantage when it comes to full time salary negotiation. With contract-to-hire, while the full-time salary range is discussed up front, the final number doesn’t come into play until the offer is extended. By this time the employer is certain that you’re the one they want. They have seen what you bring to table, and they have invested time and effort in bringing you up to speed . You have leverage, since replacing you would be costly and risky. Now paying you an extra 10K seems like no big deal compared to the expense of bringing on a replacement!
- If things don’t work out, you are better off than with a perm position. Even with a perm position things can happen to cut your tenure short. Short term employment in a full time role raises red flags when prospective employers review your resume thereby reducing your chances of obtaining a new job.
Contract-to-Hire is really only suitable for entry-level or low-level IT employees. A person looking to work in a different area of IT, or to get some added experience may consider it if they have no other options, but high-level individuals do not need to resort to this. Contract-to-Hire is a sign of bad faith by the company, in that:
1. It is typically used to get a contractor in at a lower rate than if that contractor had his or her own business and was charging the company directly.
2. It is also used to get someone to complete a project over specified period of time and then let them go when the date approaches in which they would convert to full-time.
3. The contract-to-hire aspect of the position serves as a “carrot” dangled in front of the worker by a company that has no intention of hiring someone full-time, but wants a commitment from the worker. A situation that should be reciprocal, instead becomes exploitative.
If you have enough experience and skills, it makes no sense to do contract-to-hire. Simply work as an actual contractor (start your own company, sign on with a broker or 3rd party that places you into projects and gets a piece of the action, etc.), or go work somewhere full-time.
The sad reality is (or maybe, as the author proposes, not so sad) that many MANY companies use contact-to-hire to get perm employees.
Yes, there are companies that lead people on. Or, sometimes the business climate changes and suddenly the hiring manager loses the position they thought they were going to fill with the contractor.