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A person I know -- I could call him client or business associate, depending on the project --, who has more seniority than I do, was approached by a big institution looking for a consultatn-programmer for a 6 months contract. He told them he knew a guy (me) who could very well do the job.

I was rather surprised when he told me that he'd negociate for me and keep a cut on my hourly rate, amounting to about 10%. Overall, he'd make more or less 5000$ with that deal.

I am all but comfortable with this and would rather give him a finder's fee, but I'm not really sure what would be a reasonable amount for it. Somewhere between 500 and 1000 would seem more than fair, but I'm open to other people's experiences and perspectives.

Keep in mind that it is reasonable to assume that even without him, I could have ended up in the candidates, since one of the recruitment agencies with which they deal have me in their database. Moreover, I recently worked for that same big institution through that agency, and had excellent evaluations.

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Sounds to me like your recruiter is not making much on this deal. I'm a programmer as well with over a decade of experience in the industry. My past experience has been that at least 20% is typically the norm for their cut. One place I worked, I actually saw the check that was being paid to the recruiter for his (one-time) finder's fee of $10,000. If it were me, I wouldn't be worried about someone else making $5K, as long as I'm happy with the rate I'm getting; if the rate weren't competitive, I wouldn't recommend taking the job.

  • Thanks for your feedback. I see your point, but just one precision: the guy making 5,000$ is not a recruiter. He's more like a business partner of mine and client. So his cut would be in addition to the recruitment agency's. And for a brief update, the said agency is trying to get him out of the picture, which puts me in a very delicate position... – Jason V Dec 3 '15 at 6:32
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I'd go for the 10% fee, if the remaining 90% fits into your standard. This is not unusual nor excessive. I'd call it the "market price". After all, this is what UpWork takes.

Maybe someday you'll be on the other side. :)

  • Another upwork service is 20%. Also note that Upwork takes %11.11 and %22.22. It's a mathematics and they chose the "other side of the equation" to show you how much they take ;). – Peter MV Feb 5 '16 at 11:04
  • Funny you mention being on the other side... There would be opportunities for me to do that, but I feel really uncomfortable doing it. I'm okay with just putting people in contact, leaving the money out of it. – Jason V Apr 15 '18 at 5:42
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As others pointed out, 10% is not a lot. Yes, $5k is a lot of money and it hurts, but would you get 90% without him?

You can always ditch the guy and approach to the company directly. You will earn those 10% (maybe!!!), but you will lose recommendation point.

For me, I never ever (!) ask how much someone earned for recommending me. I have my own rate which I don't change. If he can earn 3 times more on me, let him be. I know that one day, I can only benefit from the fact that someone sold me for 3 times my rate.

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A reasonable rate is 15 percent. But remember face-to-face time with both parties, along with a good price, will keep you working on to the next client. Quality of work, materials, pricing, responsiveness to the client's needs. and your overall ability to work well with others will ultimately be the key factors in your next job assignment and the rate of pay. You can charge for the next job. Staying actively involved with the present project will get you more leads to better jobs, hence expanding your contact and communication.

  • In today's industry it's just better to be well rounded be the recruiter and the developer this cut up the recruitment causes companies love cutting costs anyways what's the recruiter other than overglorified salesman that's just spending money and wining and dining people if you're good at what you do your work will speak for itself – David J Lester Jan 2 '16 at 21:49

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