5 must-knows for IT contractors in the brave new world of software development hiring

In some current pockets of contract software recruitment, the tables have turned. There is an oversupply of contractors seeking out opportunities. The power which highly experienced software developer contractors once had has somewhat shifted.

It is important to gear up for this brave new world to ensure you get the best deal that is mutually beneficial for you and the client, while not losing a good opportunity, writes Storm Robertson of specialist software developer recruitment agency VIQU IT Recruitment.

1. Shifting Sands

Previously, when established and skilled software contractors would seek new roles they would field off multiple calls a day from software development recruitment consultants like me, allowing them time to have the pick of the bunch. They’d sit back and then simply select whichever best suited their career aspirations and rate-desires, or just played to their strengths.

Now, with more software contractors on the market and uncertainty from businesses leading to less opportunities, the competition has exponentially increased. This means many software development contractors have got less offers coming their way, with rate pressures and questions as to whether to relax their requirements for the types of roles and projects they are willing to take.

Consequently, in recent months, for roles where I’m asking for experience in specific languages and applications, I have noticed an increase in software contractors applying who, mystifyingly, have barely touched the technology in the last three-to-five years! This is especially the case with some of the most popular openings -- outside IR35 roles.

Would YOU ring back three times?

Candidates now have to be brave and make tough decisions over whether to accept a contract and then honour; see it through to term, or to walk away and look for something more in line with their requirements.

The volatility of the software developer contractor market is causing many companies to only offer short-term contracts, so they can be more flexible in responding to market conditions. Therefore, it is now far more important for contractors to hit the ground running and show value-add, to stand a chance of being extended.  

Some contractors will still choose to turn software developer assignments down, and that’s okay. However, I would caution you not to be overly picky in this brave new world!

Decline once and then twice, and the recruiter might not think it’s worth calling you about software development opportunities in the future. Communication is key in terms of why you decline, and what you’re looking for -- assuming, that is, you want to get the most out of partnering with a software developer recruitment agency!

Overall, a mindset change is needed. Unless a software developer candidate has extremely niche skills / experience, they are no longer in the driving seat in Q1 2024. Some contractors need to adjust tactics to get the best out of the market -- or face being benched.

2. Contract blinkers

Contractors must read and review every contract, plus the schedule, plus T&Cs, for the parties they engage with. Sounds obvious; sure, but the amount of times software developer contractors quietly fess up to me that they didn’t get into the small print is worryingly high.

Are you an IT contractor in a rush, but acknowledge that the devil is likely to be hiding in the detail? Okay, here’s where to DEFINITELY look so you know where to brandish your fine-tooth comb for your next software development agreement or contract.

• Definitions

It is always important for the contractor to make sure the contract is clearly defined in terms of a huge host of factors. These include the IR35 determination; the term, and whether the engagement will be onsite, hybrid or fully remote. These aspects of a contract are nothing new, however, they’re among the finer details often skimmed over. Timesheet deadlines, notice periods and payment terms are too often overlooked too.

A word about the latter. I’ve spoken to numerous software development contractors of late who’ve been stung by extended payment terms. Some software developer recruitment agencies will sneak these terms into the contract, expecting it to go unnoticed (at least until AFTER the contract is signed).

• Preferred Supplier Lists

It's normal for recruitment agencies to have a list of umbrella companies they are happy to engage contractors through. Going through an agency-endorsed umbrella has its positives. They will have an existing relationship which they can leverage to solve any payrolling issues down the line, for example.

However, for some contractors, not being able to use their umbrella can be a deal-breaker. In these instances, the contractor must consider whether they can go ahead with the opportunity or not.

The way I see it is; as long as the umbrella demonstrates good compliance, their service is well-rated and the payroll rate is sound, I would try to be flexible and sample what another umbrella can do. That said, it is always important to be cautious with a new umbrella company, as my boss Matt Collingwood has recommended here, when it comes to PSLs.

• The unspoken

Be vigilant if not wary about clients and us recruitment agencies who are hesitant to share information about the client, the client/agency finances, or the project’s goals. Or any other area which you’d expect to be in the contract, or the schedule but isn’t.

A lack of transparency can indicate potential problems further down the line. Yes, there may be commercial sensitivities but, in the software development space especially, such sensitivities have been used by clients or projects as an excuse to misrepresent or mask issues. In some cases, we’ve had things embellished; in others, things severely undersold.

Where the unspoken or omitted bit emerged and was totally unreasonable, software contractors have had to give notice and start again on the contract search. My take? Contractors should be firm and walk away from unfavourable or unfair contract terms. It is absolutely okay to decline temporary opportunities that don’t meet expectations, particularly where you tried to straighten the issue out at the outset.

3. Interview blinkers

Before contractors accept a contract, they should assess the scope of work, timelines and deliverables required, and this assessment should begin at interview.

The face-to-face is the first opening for you, the candidate, to detect ambiguities and to not commit to unrealistic deadlines.

So, this comes down to you asking all the right questions in the interview and ensuring what was discussed is reflected in the scope of work and then the contract.

I have spoken to many software contractors who took part in detailed interviews, but still found themselves walking in on their first day to something completely different -- situations riddled with spaghetti code and legacy, lacking the innovation that was ‘sold.’ So don’t be frightened to adding to the already significant interview duration by probing whatever you feel needs probing.

Contractors who choose not to thoroughly assess the scope of work because they are just interested in getting the interview done and accepting a contract to get paid, should think again. This ‘get in-get-out’ approach could result in contractors needing to suddenly exit and not honour the terms they agreed. Even if your only fault was NOT turning inquisitor in your own interview, this premature end can follow contractors into future roles, reputationally, and see doors closed. Therefore, contractors must ensure they use the interview stage to feel happy and confident in their abilities to deliver the scope of work.

4. Longevity? I don’t blame you…

The brave new world of software development for contractors has seen some companies choose to terminate their contractors early, due to budgetary constraints.

It is very difficult to gauge whether the project’s cash running dry is a possibility from the off, even if you did use the interview stage sensibly.

However, sometimes the writing is on the wall, but contractors ignore the inevitable in the hope that the client will find a magic money tree!

Previously, pre-brave new world, contractors would NOT have had to search far and wide for their next software development engagement. But now clients are in the driving seat, and competition is fierce, those contractors whose engagers didn’t’ count the pennies properly are getting a nasty shock.

If you want a contract that ensures longevity (and in the current climate I’d very much understand if you did), try to get one which adds positively, or differently to the breadth of projects that you have already completed.

Should you end up out of contract unexpectedly, due to the client’s bean counters fouling up or another reason, it’s the bouncing back that’s important. Software developer contractors should be regularly updating their Github and LinkedIn profiles, staying active on professional platforms and nurturing relationships with software developer recruiters to thrust themselves back into the market.

A final word on those pesky purse strings. Contractors should only partner with recruiters who run background checks on companies so that you, the candidate, can at least tick off financial stability from your client concerns. Contractors can also do their own ‘due diligence’ on the company to double-up on peace of mind.

5. Trust your agency

If a contractor is choosing to partner with a software developer recruitment agency, they must trust in that relationship. If the contractor wins a contract, the recruiter wins a contract, so it’s a mutually beneficial relationship. As a recruiter, I will go to war for my candidates (and clients), to ensure we get the best deal where everyone is happy.

Too many times have I heard of very transactional-based relationships filled with mistrust. I don’t paint every contractor the same and similarly, I don’t paint every recruiter I go up against the same, so contractors should not either!

The key to solving this is to build a connection consisting of honest communication and a belief that each party understands what the other expects. Every party should be working towards the common goal -- which is a contract. Mistakes happen. However, if a contractor feels the recruiter is not taking their best interests into consideration, organising a call is the best way to get back on track.

Pick your battles

A recent experience I had is a great example of trust being key.

One of my new software engineer contractors was excited to have a final-stage interview in the diary, but it was cancelled as the client met with another candidate who they instantly loved -- they offered up the contract in the very first interview! The client said they would “consider” my candidate for future contracts. I was very honest with my candidate about the situation. We both lost out, as the other candidate wasn’t mine.

Yet quite annoyed, the contractor took it upon themselves to get in touch with the hiring manager directly. This was unfortunate and had a detrimental impact, as the client would have likely looked at the contractor for future contracts. But on the receiving end of the disappointed, vexed contractor, the client now says it won’t work with the individual. Mainly, they said, it’s because they don’t like how the contractor handled the situation. 

I understand there are instances where contractors have to take matters into their own hands. However, this wasn’t one of those occasions. It showed a clear lack of trust on the contractor’s side, and it resulted in no contract! And no contracts going forward either.

Final thoughts

In closing, don’t downplay red flags. Things do happen at the contract negotiation stage and it is human nature for there to be teething problems. So, try to solve any issues or niggles early on. Give the client and software developer recruitment agency a fair chance to address your concerns, so that informed decisions can be made.

Remember, being a successful software contractor in this brave new world requires adaptability, resilience, and a proactive approach. By following the above tips and utilising your skills effectively in the market, you can navigate the challenges and thrive in this dynamic yet challenging environment.