Hourly Rate Increase

[Katie]

Hi,

I work from home as a self employed PA.

I haven’t increased my hourly rate for 3 years and would appreciate any advice for what would be a reasonable increase please?

Thanks

 

[BubbaWY]

You would have been best increasing year on year as its more difficult doing a significant increase in one jump.

One option is to increase it year on year (for the last three years ) based on each years annual inflation rate and see where it gets you to and whether you believe the increase will be accpetable to your clients.

 

[Paul Kelly ICHYB]

You know what you need to increase it by.

Your clients know what they will accept.

Your increase will depend on what you currently charge and what you are worth to your clients.

 

[HFE Signs]

Find out what other people are charging, I'm not saying copy them but it will give you some idea of the market rates

 

[Katie]

Thanks for your replies.
I was thinking £1.50 to £2 increase per hour. Would that seem reasonable?
I work as a PA for a UHNWI in their business but am conscious they don’t like to reward and give bonuses. Eg, PA’s doing a similar job to mine receive monthly bonuses, commission and I don’t. I just get paid for the work I do.

 

[AlanJ1]

I was thinking £1.50 to £2 increase per hour. Would that seem reasonable?

Depends what you are currently on, kind of a how long is a piece of string question.

It also depends on how you think your employer will take it, what if they say no?

 

[Mark T Jones]

Look up RPI for the period in question - at a guess I'd expect it to be circa 25% (given that we've seen the highest inflation in a generation)

That's a reasonable increase. However, ad others have said it is far more palatable if you go for an increase each year rather than a sudden jump.

 

[ecommerce84]

Agree with @Mark T Jones completely - a 25% increase is what you should be looking for after no pay rise for 3 years.

I’d also agree @BubbaWY in that you need to increase your prices every year so that you’re earnings aren’t going backwards which is what has happened.

Finally, is the UHNWI your only client? If so, HMRC would likely not consider you self employed, but an employee.

By being self employed rather than an employee you are missing out on paid holiday and pension payments so your base charge as a self employed PA needs to be much higher than that of an employed PA to compensate.

Don’t let your own standard of living drop to save this person a few £. You’ll regret it later down the line. But I do appreciate that’s easier said than done.

 

[Porky]

Some of the replies here just illustrate to me how this country is losing its way. This ideology that as the OP hasn’t increased her freelance rates for three years well she is due at least 25% then is utter BS. Perhaps a union or pay review body is needed ehh??!

The U.K. is just becoming uncompetitive by the day and this ridiculous ideology over pay, led by our new lefty government just fuels it.

Look it’s simple business here. It’s supply and demand based on not what she thinks she wants, or should get 25%, why not 100% and back date it for three years, perhaps go back to work done three years ago and re-invoice that higher, no, it’s what that service is worth to the actual person or company paying the bill and what they can afford. There is a worldwide market of suppliers out there.

If she puts rates up to a ridiculous level she risks losing the contract, her clients outsourcing the work elsewhere. There are plenty of hungry mouths out there ready to take her work on. Also, the very businesses she supplies are equally under pressure, the climate is ugly out there imo unless you work in the public sector and oblivious to it.

My advice would be not to whack her rates up so she becomes uncompetitive but to look at what others supply her clients at and ask for an average smaller moderate increase now based on that and be flexible. If the client can’t afford the increase be flexible enough to compromise. She can always look to annually increase in the following year by a few percent. If she hasn’t increased her rates for three years then she can justify why an uplift is in order but not to get greedy is my view. She can always look to add other new clients at higher rates if she can secure them? But a big increase on no future work if they go elsewhere won’t benefit. Tread carefully is my view.

 

[Mark T Jones]

Some of the replies here just illustrate to me how this country is losing its way. This ideology that as the OP hasn’t increased her freelance rates for three years well she is due at least 25% then is utter BS. Perhaps a union or pay review body is needed ehh??!

The U.K. is just becoming uncompetitive by the day and this ridiculous ideology over pay, led by our new lefty government just fuels it.

Look it’s simple business here. It’s supply and demand based on not what she thinks she wants, or should get 25%, why not 100% and back date it for three years, perhaps go back to work done three years ago and re-invoice that higher, no, it’s what that service is worth to the actual person or company paying the bill and what they can afford. There is a worldwide market of suppliers out there.

If she puts rates up to a ridiculous level she risks losing the contract, her clients outsourcing the work elsewhere. There are plenty of hungry mouths out there ready to take her work on. Also, the very businesses she supplies are equally under pressure, the climate is ugly out there imo unless you work in the public sector and oblivious to it.

My advice would be not to whack her rates up so she becomes uncompetitive but to look at what others supply her clients at and ask for an average smaller moderate increase now based on that and be flexible. If the client can’t afford the increase be flexible enough to compromise. She can always look to annually increase in the following year by a few percent. If she hasn’t increased her rates for three years then she can justify why an uplift is in order but not to get greedy is my view. She can always look to add other new clients at higher rates if she can secure them? But a big increase on no future work if they go elsewhere won’t benefit. Tread carefully is my view.

Perhaps I'm guilty of assumption here. Specifically assuming that:

A. The OP is decent and intelligent

B. This is a discussion/ negotiation, not a belligerent set of demands.

I'll stay with the view that RPI is a recognised and widely accepted metric, and will be a good opening point for discussion.

In a similar but slightly different scenario, my wife was in exactly this situation- the difference being she had too many customers. On my advice she put her proces up by RPI since the last rise - emailed customers past and present. Part of the aim was to lose customers.

That part failed spectacularly. Loads of replies along the line of 'we fully understand '. Some lost customers came back.

Now we're back to bashing against the VAT threshold looking for ways to lose customers.