Guest Blog: Niall Kelly,

07 Mar 2018 | 12.41 pm

Guest Blog: Niall Kelly,

Calculating the daily rate for IT Engineers

07 Mar 2018 | 12.41 pm

One of the most common questions we get asked at is how do you work out a contractor’s daily rate. We suggest a simple rule of thumb as follows.

A .NET web developer with five years commercial experience and a degree will probably command a permanent salary of €55k to €60k. Due to the uncertain nature of contracting – they are usually in and out within 3-6 months – if we add 33% this will give a notional annual salary of just under €80k.

This is then divided by 230 which is the available ‘billable’ days in the year. This takes into account holidays (14-20), days sick (5-10) and bank holidays (4), as well as 104 weekend days from the 365 days in the year.

So if you divide €80K by 230 you get €347, which is his or her daily rate, or rounded to €350 per day.

The recruitment company will then usually add a margin of between 15-20% for their services in both finding the candidate and payrolling them i.e. paying the contractor and waiting to be paid by the client.  So the client will then expect to pay between €400 and €420 per day for a senior .NET developer.

There are other factors which must also be considered. High demand for specific skills can add a premium of anywhere between 15-25% onto a contractor’s daily rate.

Specific industry experience can also command a similar premium. Using a consulting house/software house that will also be involved in managing an IT project can mean the rate paid by the client will usually be double and treble the contractor’s rate.

For more information, visit ‘Contractor’s Corner’ on


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