Author Topic: Consulting for my old company while working at new company?  (Read 1075 times)

Easye418

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Consulting for my old company while working at new company?
« on: December 06, 2019, 08:41:45 AM »
I am moving to a new opportunity and wrapping things up here.  However, I was thinking about offering up my services on a consulting basis to my old company until they fill my role.  Month end is a big process for them and I figured I could bill at least 8 hours a month working for them on my weekend.  Currently, I am making salary ~$65 an hour.  The two companies do not compete with one another.

1.  Is there any trouble I could get into with my new company by doing this?
2.  Do I need to inform my new company about this?
3.  What is an acceptable rate?  I was thinking $150/hr.
4.  Is this something really worth doing?

Cheers

Sibley

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Re: Consulting for my old company while working at new company?
« Reply #1 on: December 06, 2019, 09:41:45 AM »
1. Maybe. Depends on their policies. But do you want to have split focus while starting a new job?
2. Maybe. Depends on their policies.
3. Sounds reasonable.
4. When you're at a new job, you generally want to make a good impression. Working on the side, presumably communicating during the work day some, is a higher likelihood of hurting your chances of making a good impression.

robartsd

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Re: Consulting for my old company while working at new company?
« Reply #2 on: December 06, 2019, 09:51:07 AM »
1) Read your contract, employee handbook, etc..
2) Read your contract, employee handbook etc..
3) What are they willing to pay? $150/hr is more than double your rate was as an employee. Is it more that they will be short staffed or that they will lack people with the skills to complete the work. If they lack people with the skills, they might pay that premium but I still think it might be a stretch. If they will just be short staffed $150 is likely higher than they'd be willing to pay, overtime for a $65/hr employee would only cost them a bit over $100/hr.
4) How much is the free time it would take away worth?

Easye418

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Re: Consulting for my old company while working at new company?
« Reply #3 on: December 06, 2019, 09:59:22 AM »
1) Read your contract, employee handbook, etc..
2) Read your contract, employee handbook etc..
3) What are they willing to pay? $150/hr is more than double your rate was as an employee. Is it more that they will be short staffed or that they will lack people with the skills to complete the work. If they lack people with the skills, they might pay that premium but I still think it might be a stretch. If they will just be short staffed $150 is likely higher than they'd be willing to pay, overtime for a $65/hr employee would only cost them a bit over $100/hr.
4) How much is the free time it would take away worth?

1. Maybe. Depends on their policies. But do you want to have split focus while starting a new job?
2. Maybe. Depends on their policies.
3. Sounds reasonable.
4. When you're at a new job, you generally want to make a good impression. Working on the side, presumably communicating during the work day some, is a higher likelihood of hurting your chances of making a good impression.

Great points, I think I will just not offer up consulting with them and go my own way.  Thanks!!

mistymoney

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Re: Consulting for my old company while working at new company?
« Reply #4 on: December 07, 2019, 08:49:53 AM »
old company will not be paying into FICA taxes, so take that into consideration with evaluating worth to you and what they may pay.

I think 150/hour is more than reasonable.

robartsd

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Re: Consulting for my old company while working at new company?
« Reply #5 on: December 09, 2019, 10:19:26 AM »
old company will not be paying into FICA taxes, so take that into consideration with evaluating worth to you and what they may pay.

I think 150/hour is more than reasonable.
Employer side of FICA taxes only about $5/hr on a $65/hr wage.

Of course there are other non-wage benefits that are part of total compensation. I wouldn't be surprised if the total cost of compensation for you was in the $85-100/hr range. If you would be offering a skill set that they would no longer have in-house, a 50-75% premium sounds fairly reasonable.