

Ask HN: Two-week contract to hire. Is this normal? - sown

So I had an interview last week and I think it went well. No coding questions, but lots of questions about the technology (I read about it ahead of time) and the interviewer decided to offer me 2 weeks of paid work and then they would make a decision. This is for an early employee at a startup.<p>I'm thinking of taking it but I'm wondering if there are any tricks I should be aware of?
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tptacek
Not a fan. We tend to react to offers like this as if they were obviously
equitable: after all, we're getting paid for the time even if we're not good
matches. But the offers are never equitable, because they're almost invariably
calibrated to your starting salary. In other words, "we'll pay you for two
weeks, and then, if it works out, we'll commit to paying you indefinitely".

In the real market, a commitment to pay only two weeks comes attached to a
_drastic_ jump in your rate. If you expect a $100k offer, your 2-week rate
isn't $50/hr; it's probably something much closer to $100/hr. There are a lot
of reasons for this:

* Your cost basis as a contractor is higher than your cost basis as an employee; for instance, you're paying ~2x payroll tax, and paying to maintain your own health insurance.

* Your full-time salary includes a sizable discount that buys continuous payment, even when you aren't being utilized. A contractor doesn't make a dime when they're not doing billable work.

* Your rate includes the opportunity cost of not doing whatever else it was you could have been doing (if there's nothing you can be doing except accepting this offer, I guess you can't really negotiate it --- but then, fix THAT problem, stat.)

There's more not to like about these temp-to-perm arrangements. For starters,
in a lot of jobs, the first N weeks of your employment are going to be your
least productive. A lot of that time is going to be spent ramping up. One
wonders whether offers like this are a manipulative way of getting people to
work their asses off to minimize ramp-up cost; that practice would obviously
be abusive.

Downthread, 'gruseom says he wishes offers like this were more common, because
the risk of a bad fit with a new role cuts both ways. But it doesn't!
Employment virtually everywhere in the US is at will. If you're in a bad fit,
just leave; or, better yet, negotiate with the company owners, confident that
you have a strong BATNA (what do you have to lose?).

If you come across a gig that wants to do this temp-to-perm dance, and you're
amenable to it, my advice is to ask instead to just do a series of contracting
gigs at a reasonable rate instead of taking full-time employment. Let the
prospective employer get used to the idea of working with you, and do that at
a contractor rate, so that when the time comes to cut over to full-time, your
salary requirements automatically look sane in comparison.

More people should learn how to freelance. If a job's going to force you to do
it, seize the opportunity to do it right.

~~~
grueful
I did this once, decided it was a dumb idea, then quoted the next guy triple.
It was a good learning experience, if nothing else.

The current market is drastically tilted towards the engineering talent,
provided that you actually negotiate. If companies want freebies in spite of
this - walk. It's a target-rich environment.

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davismwfl
Are they technical founders or business based? I have seen this personally
from non-tech founders and they use it as a trial. I think logn gave you great
advice. If you are interested, negotiate your perm salary and benefits before
doing the 2 week "trail".

I say this because I witnessed exactly this just 2 months ago and the small
business did it as a way to try and figure out if the developer could do the
job and then decided the rate they would pay and it was a bad situation. I was
a contractor helping this same business and terminated my relationship with
them once I delivered my promises, and the main reason was after seeing their
methods to hiring. I feel it was intentional to see what they could use to low
ball this dev, who left a full time position.

Just my 2 cents. Doesn't mean it happens like that everywhere. I really like
logn's idea, makes perfect sense and protects everyone involved.

~~~
sown
> Are they technical founders or business based?

Both. I trust the technical guy I talked to. We'll see.

~~~
davismwfl
Yea, I honestly wouldn't have a problem doing something like this if I felt
good about the people. I think it just all depends on your impression.

Most of us probably feel pretty confident in our skills so proving we can do
the job is just part of the fun and challenge.

Good Luck!

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gexla
This is very common, perhaps even the norm for web development shops. Not sure
about start-ups. Probably almost never happens with big corps.

I don't see a problem with it. I don't care what my employment status is as
long as I'm getting paid. The only difference between contractor and employee
is the forms that the employer needs to fill out and that's not my problem.
However, if I'm working as a contractor then I'm not going to change anything
for the employer. I'm still going to charge my contractor rates and I'm still
going to take in new contract work. It's too much of a risk to throw my
business cycle out of whack while the employer tries to make a decision.

~~~
sown
So I guess my next step is to try very hard for the next two weeks? :)

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bdfh42
If they are good guys then they are aware that 2 weeks would give them enough
time to see if you can do the job or not - very fair and sensible.

If they are bad guys then they know that once you accept a 2 week contract
then you will probably have to turn down any other offers you get in the next
few days as a result of other interviews. They can then offer you (if you pan
out) a contract renewal with a longer term at a lower rate.

Tricky...

~~~
sown
They seem like OK guys. It's for a very early employee at a startup, though;
Don't know if that's common.

~~~
gruseom
I wish it were more common. It limits your risk (getting stuck in a bad place)
as much as it limits theirs (getting stuck with a bad employee).

The criticism I've heard of this approach is that someone who already has a
job is unlikely to quit just in order to try a new thing out for a couple
weeks, or to take two weeks off for that purpose. But if you have the two
weeks, are going to be paid, and think you might like to work there, why
wouldn't you want to do this?

~~~
nandemo
Well, you also have an extra risk, namely that they decide not to hire you
after those 2 weeks. So it depends on how much they pay for that period. They
should be paying freelancer rates, to account for the overhead (taxes, health
insurance, etc) and that extra risk.

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logn
You should have your fulltime offer terms in writing for when they do hire you
full-time. You don't want to be surprised, especially if you're leaving
another job.

~~~
sown
Thanks for this tip. It's very helpful.

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dylanhassinger
yes this is normal, especially if outside the bay area

