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What's a fair buyout price in this case?

By rmoskal ·
I'm currently working with a client through a another firm that "placed" me there. It's not a contract shop; I was brought in as a subcontractor. Due to the other firm's carelessness I have not signed a non-compete with them.

I've been working with this client for more than a year, staffed up the project, and grown the business.

The other form hasn't done anything to manage the account so after a year the end client has decided that they would prefer to work directly with me.

They are willing to compensate the first firm for walking away from the relationship. As a ball-park firgure, what would be a reasonable amount?

Thanks.

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I'm a geek, dammit, not a lawyer

by epepke In reply to What's a fair buyout pric ...

That having been said, I do consulting work through an agency. Their deal works like this. If I have been working with a client for six months, then the client can make me a full-time employee without paying the agent any extra money. If it's less than six months, there is some fee.

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Recruitment firms...

by JamesRL In reply to What's a fair buyout pric ...

usually charge about 10% of the first year wages for people they place. In tough financial times and competitive markets this can slip to 5%.

I'd say the firm that contracted you deserves that much - between 5 and 10 %, for having brought you into the firm. For not handling the account properly, they will be loosing substantially more.

Before I would carry out this transaction I would think long and hard. The firm that placed you will not be happy with you or your new employer. You should be gracious in your announcement.

Before I would do something like that, I would really have to be certain that I would like to stay with the new employer for a long time, as the possibly burned bridge and possible bad rep from the firm that placed you could follow you for a few years. You will find its often a small world out there.

James Linn

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Thanks James

by rmoskal In reply to Recruitment firms...

I agree with all you said. Especially if it were the case that the other firm was a consulting shop. In fact they are actually a firm jist like mine, only a bit bigger.

Thanks again for all the replies.

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