DevOps Contracting: Tips & Tricks

Have you ever considered switching up to contracting? 

Contractors can create a work environment that suits them. By managing their hours, being responsible for their own business dealings (unlike temporary employees who receive payment from an agency) and having the opportunity to decline work, they are given much more freedom in the type and quantity of work they do, all in all giving them more independence and control in their working life. Contractors in the tech industry providing expertise in DevOps can make significantly more money with higher pay rates and tax advantages. They are seen as specialists, problem fixers or ‘SAS’ engineers, providing specific knowledge and expertise to help deliver on challenging client projects.

Before becoming a contractor, it is important to evaluate whether the employment type is suited to you. Do your research and make an educated decision on whether the attributes required suit your personal circumstances. For example, will flexible/varied working hours make your life easier or is it outweighed by the lack of job security that comes with contracting? Do you possess the drive to find new work regularly?

When researching, assess whether there’s a demand for contractors in your desired field and ensure you have calculated what your daily rate expectations are keeping in mind that some roles will fall inside IR35 (more on this below) and your tax deductions will be higher. As the role is financially independent, you’ll be in control of every monetary detail, including setting up a business bank account and paying the correct tax if you work through your own limited company or making sure you sign up with a reputable umbrella company. Therefore, you will need to be aware of the fundamentals of business finance and ensure you’re financially organised.

Two Options

There are two options when it comes to becoming a contractor, as mentioned above you can create a limited company or join an umbrella company. Working through an umbrella company is the most straightforward of the two, it is ideal for those who wish not to deal with the administrative side. An umbrella company will pay you on a weekly/monthly basis whereas starting your own limited company can yield a higher take-home pay from paying less tax and easier access to funding. Get speaking to umbrella companies and accountants so you can ascertain whether having your own company or going through an umbrella to look after your financial responsibilities will be the best option.

Taxes

HMRC realised that both contractors and businesses were bending the rules and not paying the appropriate tax. For example a disguised employee with all the benefits on both sides (company perks and lower taxes) and not on a PAYE basis – now the IR35 regulations keep everyone in check. Contracts are now classed as inside or outside IR35: inside meaning you will need to work through an umbrella company and outside meaning you can work through your limited company should you wish to set one up. To find out more information about IR35, read our IR35 blog or get in touch with us and we can recommend some trusted umbrella companies to contact.

Advice on building your contractor CV

Building a CV and online presence is vital for attracting top clients and landing your first contracting role.

You’ll need to ensure your CV is up to date and you’re marketing your skills effectively. Most roles require a specific skill set, focusing on the skills required or even tailoring your CV to target these will help you appear as a strong candidate. 

•    Contract work tends to be relatively short term which could create an extensive list of previous experience, however, try to keep your CV brief and informative. Perhaps prioritising the relevant experience to the role.
•    A common complaint from clients is that contractors’ technical documentation/ knowledge transfer is lacking. Why not help alleviate this concern by being thorough in this area and promoting your attention to detail in this space in your CV and in an interview.
•    Having strong references from previous employers is essential. Validating your experience timelines on your LinkedIn profile will show that you’re a thorough candidate. Keeping your profile up to date is also vital as contractors with sparse-looking profiles look suspicious.
•    Try to avoid having multiple short stints with multiple clients. If your contracts are all 3-month long, people might see this as a red flag and question why the contracts aren’t longer-term or being renewed. 

Leaving your permanent employment 

•    It can be unnerving to leave a permanent job when you have no previous experience as a contractor, but it can be worth the change for the advantages contractors have over permanent employees.
•    As a permanent employee you will have a notice period, which clients might not be prepared to wait for. Clients will want contractors to be able to start immediately, and permanent employees will not want to leave their current position without anything lined up to replace them after notice is served. This is an obvious barrier to entry. A possible solution for this is to take an initial lower daily rate for your first gig with a company more willing to wait for you to serve your notice period. Certain clients who don’t have the largest budgets might be more forgiving of a long notice period and no prior contracting experience.
•    If you’re looking to transition from permanent employment to contracting in the DevOps space, get in touch with Prism Digital, as we may have the perfect first DevOps contracting job for you. 

Attracting work

•    Once your online presence is established it is important to start networking. This will also help with gaining referrals and recommendations.
•    There are many ways one can approach this but getting involved with community events/talks will help you meet other like-minded people as well as gaining knowledge in the subject area. Attending London DevOps meetups is a great way to network with others in the tech industry as well as meet potential clients. Come along this evening (26th May 2022) – you can register here! 
•    To gain access to the best clients, get in touch with a recruitment agency. They’ll be able to keep you updated on opportunities and assist you with securing new contracting roles. More people find their roles through an agency than independently according to Indeed, and many roles won’t get to the stage where they are advertised as they are filled by candidates who are already on an agency’s books. 

Speak to one of our team at Prism Digital today for assistance in breaking into the contract market!