Contract work

Briefly.....

I have been programming for a few years now. A while back, I was asked by the reseller of the cam software I use to teach a class one night a week. I took the gig and have enjoyed it to this point and plan on doing it for the foreseeable future. The extra $ is nice.....but to be honest....i also just enjoy getting out of the house and doing something different. Now the same guy has approached me to do some contract programming on the side.....his computer...his software.....his customer.....completely seperate from my "bread and butter" job. I will not do anything to jeapordize that. If something needs top booking.......my day time gig gets that, period.
My question is ......what sort of $ should a person charge on such a deal? There will be some tooling consulting, fixture consulting kind of work with it. 90% I will be able to do from home.....one concern I have is what happens if my program crashes the guys machine? Is it reasonable to sign some sort of contract spelling out such things? I guess I am becoming a small business and ought to start acting like one.....I am just not sure how to do that.
Parleying my skills and free time into something that might change my "employment direction" in the future is not a bad thing....just trying not to F ... it up lol.

Just as a rule of thumb, a contract programmer should be getting about 2X what they'de be paying an employee programmer.

Best have a good lawyer!

Larry Dickman said:

Just as a rule of thumb, a contract programmer should be getting about 2X what they'de be paying an employee programmer.

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That's not even enough 2.5X-3X maybe 2X just starting out simple 2/2.5D stuff.

I'm curious what would drive the price up to 2-3x normal programmer wage. Is that to make it worth your while?

yoke said:

I'm curious what would drive the price up to 2-3x normal programmer wage. Is that to make it worth your while?

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The employer wouldn't carry the typical employee overhead such as payroll taxes, workers comp, benefits, etc. Imagine using a temp service for part time labor. They charge the employer $20/hr for an $8/hr employee and they carry the overhead.

2.5X-3X is probably a good wage unless they're paying under the table and we won't go into that. If they're making you receive a 1099 so they can have the proper bookkeeping, 2.5X or so.

What to charge? Throw him a number. Start a little high. Most they can do is say no. Most "at home" CAD guys around here get $50-$60/hr. They are just making prints. Actual machine programming would bring more IMO. Around $100/hr +/-.

Everyone seems to be focusing on the money, but that seems to be consensus 2-3X hourly wage. The more important question is what happens if he crashes a machine? I would think you should carry some type of insurance I don't think it would be very expensive. One other question to ask is what would happen if your program needs changes would they do minor changes themselves or would you have to tweak it while at your day job?

WDW said:

Everyone seems to be focusing on the money, but that seems to be consensus 2-3X hourly wage. The more important question is what happens if he crashes a machine? I would think you should carry some type of insurance I don't think it would be very expensive. One other question to ask is what would happen if your program needs changes would they do minor changes themselves or would you have to tweak it while at your day job?

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That was my point- 2X-3X normal wage... because of Insurance needed of some sort for this kind of thing, taxes, health insurance down the road etc etc

WDW said:

Everyone seems to be focusing on the money, but that seems to be consensus 2-3X hourly wage. The more important question is what happens if he crashes a machine? I would think you should carry some type of insurance I don't think it would be very expensive. One other question to ask is what would happen if your program needs changes would they do minor changes themselves or would you have to tweak it while at your day job?

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If I received a program from a contractor, there is o way I would just set it up and press go. It would definitely go through Vericut. If didn't have Vericut, I would dry run it high and check it out. Failure by me to safeguard my own equipment would be completely irresponsible on my part. I would not consider a contract programmer liable for a crash.

Also, will the folks you're programming for now (FT) think the new client is their competition? What happens if they think that when they find out? (Note that it doesn't matter what you think -- only what they think.) What does your FT job employee handbook or employment contract say about working on the side for others? Do they have IP dibs on any machining-related thought you have whether on the clock or off?

Just some stuff to ponder...

Chip

It's almost impossible to have two masters.

Personally, I'd look into some liability insurance. Either purchased from you, or by your contract-employer.

Not just equipment-damage cost, but you also have to think about lost production time if the machine goes down because of your crash, and any lost "opportunity cost" and/or failure-to-supply penalties from your customer's customer...

For example - we're a Tier-2 supplier. One of our HMC's got crashed and it took out the B-axis, which took several weeks, and MANY thousands of dollars to get running. If it was our only machine, it could have cost us HUGE money in lost-production/penalties.... Just something to think about - maybe you won't be doing work these types of customers.

Also some things to think about...

-Like another mentioned - who makes the "tweaks"? You or them?
-When do they "sign-off" on your program? After the file-transfer? After the first-good part?
-If crashed after their "tweak" - is it your fault or theirs?
-If you're doing parametric/macro-variable programming, push the rate up even higher. Much more to think about when trying to work through all the outcomes/possibilities/safeguards when dealing with parametric programs.
-Simulation would be very valuable, and could also be used as a selling point... (All programs run through stand-alone verification simulation software before released to customer...)

Not trying to be discouraging. There's just several things to think about that aren't always obvious at first glance.

All of the above, and:

1) If you're to do the G-code, not just the path programming, do you have a proven post processor for each machine to be used? Do you have a sample program already in use by the company so you can see if they use any variations of typical comments, work offsets, Z levels?

2) How good is their machinery? Scarred spindle bores and old toolholders, or new Schunks in 2015 Okumas?

3) Tooling choices - do they have set tool sizes and T numbers? Do they use regrinds and tool comp? Do they use new tooling and centerline programming? Insert tooling or solid? Coolant or air blast? Targeted in-cut life?

4) Will you also specify all fixturing and clamping? Will you supply a part model with all such items shown?

5) Accuracy requirements and scrap rate - how do you agree to get to spec with minimal (or no) scrapped parts? What's that chunk of Ti going to cost to replace? Do you have to tell them to loosen the vise prior to the finish pass on that Al electronics box? Stress relief prior to finish cuts on that 4140 hydraulic manifold?

6) Do you supply the entire file set with all programming paths and models? Just G code that comes back to you for rework? What if they make changes to paths, code, etc. - how to document and maintain currency for all parties?


If it's one company you're likely to program for, I'd like to visit them if they're local and get a sense of how they process work. Get comfortable that if you provide a good program and instructions that they'll follow through. That also helps confirm they're not likely to be in conflict with your current employer. If you'll be sending code to lots of companies around the country (or world), consider the loss of control over what you've created.

It is a big responsibility, I'd definitely have insurance and be charging $100/hr plus to do most of the jobs. And don't short yourself on hours worked. Maintain a clear understanding of "thinking time" as billable.

Let us know what you decide to do, and how it works out for you!

I consult on the side, I charge 1.5x my day job wage and think of it as overtime, I use my day jobs cam system so I don't have any costs to do what I do other than gas for setups (which they pay for). I haven't thought about insurance... But I probably should. However I write my own posts and don't crash machines... but that doesn't mean it'll never happen >.<

I think people are over thinking this about insurance and what if the machine crashes and what if what if... If they approached you, I would think they trust you and you already have some kind of relationship with them. Now, if you were advertising contract programming as your job, maybe then you need liability and such...
For the wages, I think 2x your day job is a start, but consider what you make as being average/low/high. I mean, if you are in the top 98% of wages in your area, then maybe 2x might sound greedy. Not saying I agree with those charts as they seem to call 'machinist' anyone that presses a green button, thus bringing the average down IMO. Sorry off topic....
I have used (well where I worked when I started into cnc) contract programs, it was still my responsibility as the setup guy to prove the program out. I don't think we had any crashes, but I will say it is a rather daunting task to prove out a program when you have only the vaguest idea what it is going to do If I were to do this, I would include very VERY detailed set up instructions, lots of pictures, a comprehensive tool list (#flutes, coating, flute length, projection, holder type, etc) notes inside the program, M0 stops to check features, etc. I would rather give them way too much information then take a chance on something being 'understood'.

I do contract CMM programming several nights a week with many different companies. Just draw up a contract that states you aren't liable for crashes/scrap and things must be run at their risk, and they can take it or leave it. Unless you're doing programming work for freaking NASA, you don't need insurance and you don't need to confuse them and yourself with a pile of paperwork and rules and clauses. If they came to you, they want programming done, they heard you were good, and the proof of your skill will be in the program you give them.

For companies that I know are going to use monkeys to run the machines, I foolproof things. This takes extra time. The first time I do work for a customer, I spend 5 minutes to walk them through what I did and why, so they understand why I tacked on 2 hours to add in 1000 lines of IF/THEN check code to determine if the monkey has loaded a part or a wheelbarrow on the machine. For companies that don't need that, I don't program it, I tell them I don't program it, and everyone is happy with the saved time/money- most of all me, because it means I then have time to cook myself dinner.

As for hourly rate- if you are not getting more than your overtime rate at your regular job, it is not worth it. The extra driving, the 1099's, the quarterly tax filings, the sudden programming needs.... if you don't get more than your overtime rate, you're better off buying a second lawnmower and knocking the entrepreneurial neighborhood kids out of contention.

Dylad said:

I do contract CMM programming several nights a week with many different companies. Just draw up a contract that states you aren't liable for crashes/scrap and things must be run at their risk, and they can take it or leave it. Unless you're doing programming work for freaking NASA, you don't need insurance and you don't need to confuse them and yourself with a pile of paperwork and rules and clauses. If they came to you, they want programming done, they heard you were good, and the proof of your skill will be in the program you give them.

For companies that I know are going to use monkeys to run the machines, I foolproof things. This takes extra time. The first time I do work for a customer, I spend 5 minutes to walk them through what I did and why, so they understand why I tacked on 2 hours to add in 1000 lines of IF/THEN check code to determine if the monkey has loaded a part or a wheelbarrow on the machine. For companies that don't need that, I don't program it, I tell them I don't program it, and everyone is happy with the saved time/money- most of all me, because it means I then have time to cook myself dinner.

As for hourly rate- if you are not getting more than your overtime rate at your regular job, it is not worth it. The extra driving, the 1099's, the quarterly tax filings, the sudden programming needs.... if you don't get more than your overtime rate, you're better off buying a second lawnmower and knocking the entrepreneurial neighborhood kids out of contention.

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What he said.............best response so far..................

I'm getting ready to :potentially: go down this road. I am curious to hear what others have to say. Right now i am thinking I will subcontract thru another 'employer' and they deal with the headaches. I don't know if this is plausible... I basically want to work for this 'subcontractor' at a specified rate xx/hr and then I pay taxes on that. Is that doable??

Some NC contractors are their own house and some work for a contract house. If there's a contract house involved they'll sometimes specify in their contract no independents. That's kind of a dance between the contract house and the company depending on whether the contract house can get enough people on line fast enough.

We normally paid about 2x+ average direct wage to the contract shop. They raked off about 15% to handle the personnel issues. The contractors made 1.5x of their rate over eight and over 40. We had to guarantee so many hours of OT per week.

We didn't hold contractors responsible for monetary damages but canned them if they should have known better.