RBS pay leak reveals £2000 a day IT contractors

An unauthorised e-mail was sent to 800 RBS employees and revealed how much contractors were paid for one day of work.

Union Unite said it is unacceptable for a bank that is majority owned by the state to pay such rates. RBS said it is "extremely disappointed."

Hays said it is taking the "unauthorised release of this data extremely seriously" and has launched an investigation into the leak. It is working with RBS to recover the data from recipients where possible. "Recipients of the data are also subject to confidentiality obligations to both RBS and Hays," said the recruitment firm.

A former senior IT executive at a major global bank, who asked to remain anonymous, says market forces will dictate how much contractors get paid: "If it is a very good contractor with rare skills they can command high pay."

He says such people tend to only be employed on short-term contracts. "But the banks often keep hold of them for longer because they need their skills. They are cheaper than hiring a management consultancy."

The executive says the highest-paid contractors tend to work on high-profile projects that cost millions. "It is a trade-off. The banks see £2000 per day as more attractive than a project failing which can cost millions." He added that some senior permanent staff at banks earn the equivalent of £2000 per day or more.

He said IT contractors can typically command between £250 and £1000 a day depending on their skills.

But IT contractors in the financial services sector have been squeezed during the downturn. Lloyds Banking Group told contractors in 2009 to take a 15% pay cut or leave.

One IT contractor who has worked at RBS says the headline fees skew the reality. "Overall, contractors cost a similar amount to permanent employees as there are no benefits like pensions and paid holidays. On top of that many live far away from London and have to pay for travel and accommodation out of their rate," he said.

"I suspect the higher rates are for risk consultants and senior interim managers rather than IT people."
 

This story was first published by Computer Weekly

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