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an additional item for consideration is the company itself.
You ned to check the company out along with their history with emplyees and contract workers. A company that has both employees and contractors may do this so they have a steady full-tme dedicated work force but they fill anticipated work load increases with contractors. So you have a days worth of work that they figure will be around pretty much all the time. But they also have peaks or project work where a contractor is used because when the work is done, you are done.
One thing to try and find out is what is the longevity of the contractors? If its always to the contract end and seldom goes past that time, now you know that in 1 year, your unemployed. But if emplyees have long term employment with the company, knowing that the odds are that you will still be working 1, 2 or 3 years later isn;t something to just shuff off for the pay. Basicaly, try and look pass the "pay" and look at the jobs and see if one has a benefit over the other.
Hourly rate x hours per week x 52 weeks = total annual compensation
Total compensation - employee income tax - 6.2% SS employee tax - 6.2% SS matching employer tax - 1.45% employee medicare tax - 1.45% matching employer medicare tax = After-Tax Compensation
Once you got the taxes removed, you can back out the cost of benefits to the employer and get the annual cost and then you have to divide by hours worked to calculate the hourly rate.
After-Tax Compensation - health insurance - dental insurance - 401k match - 3 weeks vacation = Net annual compensation
Net Annual compensation /(hours per week x 49 weeks) = hourly rate for employee|contractor
You have to take out the 3 weeks for vacation, since it's not worked.
Hourly rate x hours per week x 52 weeks = total annual compensation
Total compensation - employee income tax - 6.2% SS employee tax - 6.2% SS matching employer tax - 1.45% employee medicare tax - 1.45% matching employer medicare tax = After-Tax Compensation
Once you got the taxes removed, you can back out the cost of benefits to the employer and get the annual cost and then you have to divide by hours worked to calculate the hourly rate.
After-Tax Compensation - health insurance - dental insurance - 401k match - 3 weeks vacation = Net annual compensation
Net Annual compensation /(hours per week x 49 weeks) = hourly rate for employee|contractor
You have to take out the 3 weeks for vacation, since it's not worked.
To simply see your net pay after taxes, I suggest using paycheckcity.
Hi, I am currently in the middle of one of the toughest decisions of my career. I am a welder, and I've been offered a full time position with a shipyard making 22.80 per hour plus overtime @ 1.5 times that amount. This is a very stable career type opportunity includng insurance, 401k etc. On the other hand Im being harassed by an agency wanting me for the same job at the same company as a contracted employee for a 1+ year duration. The pay for the.contract work is 38 an hour and 50 an hour for overtime. Is the increase in pay worth the lack of benefits or should I just go full time and wait for advancement to make the better money? Also there is no guarantee that the full time position will be offered at any time in the future.
I would take the full-time. Medical benefits alone will eat up a lot of the profit from the higher wages, and the other benefits along with it probably make the full-time a better deal overall.
Hi, I am currently in the middle of one of the toughest decisions of my career. I am a welder, and I've been offered a full time position with a shipyard making 22.80 per hour plus overtime @ 1.5 times that amount. This is a very stable career type opportunity includng insurance, 401k etc. On the other hand Im being harassed by an agency wanting me for the same job at the same company as a contracted employee for a 1+ year duration. The pay for the.contract work is 38 an hour and 50 an hour for overtime. Is the increase in pay worth the lack of benefits or should I just go full time and wait for advancement to make the better money? Also there is no guarantee that the full time position will be offered at any time in the future.
NO! IN THIS ECONOMY please consider the advantages of going with the full time. The pay differential in contracting will not cover what you would have to make up for in lost benefits.
Are you a W-2 contract employee or a 1099 contract employee? If 1099, Knock 15% off the top because you're paying all of your own SS benefits. Figure out what health insurance will cost . Welding isn't exactly risk-free - the peace of mind that comes with knowing you have insurance if you need it is worth lots. No paid vacation, extra SS kick in, and insurance costs will eat up $10/hr of that $38.
Have you considered negotiating with the company? Saying you have a similar offer at $38/hr, and would like to know if there is any room on the hourly wage? You can do it in a professional and non emotional way, it's simply part of business. DON'T say from whom the offer came, lol! Your breakeven is $28/hr.
Best of luck.
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