I'm a ex-FANG dev that started a recruiting company, so I am VERY familiar with the arbitrary tech interview process. I'm a huge proponent of contract-to-hire. Even started a company* to make it easier for companies to offer contract-to-hire.
Now before you dismiss the idea because you are "too good" to do C2H hear me out. Everyone knows that actually working with someone on the job is the only way to get an accurate evaluation of an engineer. Everything we currently do in technical interviews (whiteboard coding, pair programming, take home assignments, etc) are just attempts to recreate a working environment. If you are hiring a contractor first, you can do a light-weight interview process and then just bring them on and start working together.
As the dev being brought on you can prove your value before you negotiate your salary. You can also try out the company and manager before committing to an offer.
It's crazy, I know, but I think it would drive dev salaries up if it weren't so hard to change jobs because of the tech interview gauntlet we've created for ourselves.
Sorry, but C2H sounds like a great idea to you because you have the luxury of having already earned FAANG money on your side. You'd have to pay me considerable money for me to consider taking a C2H role so I could cover health insurance across the usual suspects (general health, dental, vision, specialists just in case). Like many people outside of this website (and enough here), I don't have the luxury of FAANG money and I live in the United States, so I need health coverage either through my employer or on my own provided I have enough money to offset it.
This is one of the reasons I've always found it paradoxical that people in the US seem to think that universal healthcare would depress the labour market.
Up here in Canada not all procedures are insured, Pharma, Vision & Dental are the big three that most either pay out of pocket or purchase extended insurance for - though there are generally pretty good provincial programs to help with the costs of those. However, nobody is walking around in Canada concerned that they may get fired and then be bankrupted by a heart attack.
Companies absolutely do still bear a significant per-employee cost to support provincial healthcare and residents do need to pay a pretty light fee into a pool (with options available for financial assistance).
The end result is that companies do end up bearing pretty heavy burdens on a per-employee basis - but employees don't end up with as much of a burden forcing them to remain in undesireable employment positions, though some guaranteed income would really free up employees to have a more equal amount of power in the job market.
I’ll point out that untangling health insurance from employment does not necessarily require a “Medicare for all”-style universal care system. This is a subtext to your comment since you jumped there from the parent’s complaint about employment-based insurance.
Many consultant/contractor firms esp for programmers provider insurance. Its usually not as good as a top tier company benefit package of course. The biggest issue for me is you're unlikely to get a 401k or tax-benefited investment vehicle, which means if you're making programmer money you can't even do a ROTH or a traditional IRA due to income restrictions. So make sure its a really good jump in pay due to that at minimum.
You can still make contributions to a Traditional IRA [0], you just won't be able to make deductions above a certain income if your employer offers a retirement plan [1].
In my experience, with C2H you typically earn more in the contract phase than you would with a base salary, which is helpful in covering benefits or out of pocket expenses. Maybe that's not always the case, but salaried employees usually earn 80% or less what their contract counterparts do.
And you kind of have to bomb the contract phase to not be given the offer, unless there are other circumstances at play (budgets, pandemics, etc). Hang with the team at lunch or after work if they do that, make code contributions asap, and be the kind of person any team would want to have.
C2H usually just makes it easier for them to drop you if you're (surprisingly) not a good fit - and after that kind of time and money investment, they definitely don't want to do that.
> Maybe that's not always the case, but salaried employees usually earn 80% or less what their contract counterparts do.
That's because the employer is covering significant costs on behalf of the employe. A fully-loaded FTE typically costs 30% to 40% more than they're base salary.
Contractors need to make more because they're covering all of those things themselves.
At my company we do contract to hire, but it's only about 4-8 hours of work. The intention isn't to replace your current job, it's to compensate you for doing extra work for our company while we interview you.
When I was hired I did about 1-2 hours of work for 3 days, after my normal job and was hired before even finishing the "project".
C2H is terrible for the employee and you should know that, as a professional headhunter.
Negotiating your salary upfront is likely going to give you the best deal you can get. Don't kid yourself into thinking that you can "show your value" to improve your negotiating position. Your first few months on the job are usually when you are at your lowest performance, since you are learning the company's processes. That is your trial period.
You are in your best negotiating position when the company needs you more than you need them, and that is absolutely NOT after doing contract work for them for a while.
Once you're at the point of converting, if you get a lowball offer, the contract position is a black mark on your resume that hurts your negotiating position with other firms.
That said, I would be happy to do C2H if the following conditions were met:
* Signing bonus paid in full at point of signing the contract, with no clawback.
* Full health coverage during the contract portion (extra money plus the option to buy from their plans).
* Severance pay at full salary for at least 6 months if you choose not to convert.
* Non-exclusivity during the contract period (I can do other work if I want, and you don't own any IP I produce other than what I produce explicitly for you).
I think this is sufficient to equalize the negotiating disadvantage that I get for taking the contract. I don't think any of your clients would go for it.
That's not what we've seen. For example, one of our customers raised salary bands across their entire software division to accommodate the salary demands of the contractors they wanted to convert to salaried.
In most cases companies have a ball park salary in mind for the position, so when it comes time to convert there is some room for negotiation, but no surprises.
Companies are so desperate for good software engineers that they aren't going to let a good dev go after several months on contract in order to low-ball you and save a few thousand dollars.
Sorry, your pitch to clients is "throw away all of your leverage (existing job, unemployment qualification, health insurance, etc) to contract for a few months and then you'll get a great fulltime offer"? That's...deeply implausible.
I'm almost willing to believe this works for people who absolutely are unable to pass any sort of interview, but in that case aren't they still in trouble? How does a company decide who to bring on for the contract? Surely you can't replace the interview process with this.
>> Negotiating your salary upfront is likely going to give you the best deal you can get. Don't kid yourself into thinking that you can "show your value" to improve your negotiating position. Your first few months on the job are usually when you are at your lowest performance, since you are learning the company's processes. That is your trial period.
That does not conform to my experience as employee or as an employer. Do you have any evidence to support it? If does sound like something a recruiter who wants to take a cut of your first year salary (from the employer) would say.
> It's crazy, I know, but I think it would drive dev salaries up if it weren't so hard to change jobs because of the tech interview gauntlet we've created for ourselves.
How does C2H help me jump jobs as a dev who is already employed?
Since I already work 9-5, typically my only free days are my weekends. I might be willing to work for a few weekends if it would lead to a hire, but are those really compatible with what the hiring company wants? My guess is that they want me to take the step of leaving my current job, which comes with loss of health and dental insurance, which is often a big concern.
What you do is you use COBRA to keep the insurance you currently have and just build in the cost to your hourly rate. Companies expect top pay more per hour for a contractor than a salaried employee.
So you are paying for your health insurance yourself, but you keep the same plan.
There's still the risk of them not bringing you on at the end of the contract or terminating it early if it's not going well. But I think the upside of easier interviews and trying out a team out weighs the downside.
A number of the systemic issues with contract to hire have already been raised, but here’s another: taking a C2H job can immediately render you ineligible for unemployment, as you are now self employed. If the contract doesn’t work out, you could potentially have lost eligibility for not just unemployment benefits, but related food and health benefits. That’s particularly relevant now with the souped up pandemic benefits.
I don’t disagree that it would be nice if every candidate could take the time to try a company out before they join them, but the real world really can make that impractical. Some of the suggestions this thread makes around “buying” ones way out of these problems (such as knowing to have paid for COBRA ahead of time and being able to afford it) represent knowledge and opportunity that is all together distinct from ones ability to do the job.
Yea, this guy loves C2H because it makes him a lot of money. It "solves" a problem for employers - which is all he really cares about. Good employers don't use C2H because they recognize talented people have plenty of competing offers for direct-hire.
If I'm quitting my current job to come work for you, I'm not taking on the financial risk for a job that YOU decided needs to be filled, set all of the evaluation and success criteria, and know what your company's culture is actually like.
We make roughly the same whether you go C2H or direct salaried. C2H interviews generally take much less time, so we do have an incentive, but so do the companies and candidates.
You don't have to take a C2H job, but for some people that don't have stellar resumes or are bad at interviews, C2H will give them access to more opportunities.
For a very good (but not exceptional) developer, I wonder if ending up "out on the street" would be a reasonable expectation if something like this became truly widespread.
If companies like Google were no longer able to filter false positives __at Google scale__ using their current hiring practice, I wonder how long it would take to decide that the next best thing is to contract some tunable number of N contractors for K positions where N >> K and only keep the best M (K <= M << N) of them. (I expect a company like Google to occasionally keep more than K because they can't afford to throw away rockstars if they get a great cohort).
So, even if you're pretty good - if you aren't better than the bottom x% of your cohort (or some other aggregate measure) - you're out. Stack ranking for C2H, basically.
There's a class problem with C2H in almost all companies. Contractors are always seen as less than by management and especially hiring committees. I work at a company that I've been hired thru C2H. Everyone on the team, my manager knew I was one of the strongest programmers on the team. But when it came for my conversion interview I bombed. It was run by 3 of the most senior principles with the lowest acceptance rates and a penchant for "protecting" the company from bad hires. Being told despite amazingly good performance compared to peers you still aren't good enough is a nice little gut punch.
A short time later, I did another conversion interview, got people who were willing to tell me "look, we know you can code" because they had SEEN me code and design systems they were using every day. They still did some interview questions, but lo and behold I didn't feel like jumping out the window every second.
I would think the idea of C2H is instead of having an intense interview you have a performance review and talk about how you work together. If you still have to pass a high pressure interview attempt to filter you out after working with a team for 3 months there’s no advantage to C2H.
If you /didn't/ have to pass through the same meatgrinder that every other employee did there's a reasonable argument that it could be seen as an opportunity for favoritism. But that sort of ignores that if an interviewer wants an interview to go well (because they feel more empathy for one interviewee over another for instance...) it tends to go better. We like to pretend that "a question is a question" but we're just testing the person's state of mind. I've had interview questions I've answered >10 times and drawn complete blanks because I'm trapped in a tiny room with a person with an inflated title and ego, and their shadow who is intently staring at every movement I make.
People who paid a lot of money to get their education and bonafides. Or antifavoritism crusaders that like to tell themselves they can make a biasless interview process.
It's not just that they're looked at as less than, it's that they have to be treated as such. I'm on a sort of "party" committee at my work (I know, I know) and we are explicitly told we have to go out of our way to ensure no one on contract gets invited to the events, receives any of the (shitty) gifts that management hands out etc. My understanding of the rule is pretty bad but I've been told it's because they can potentially make a case in court that they were treated as full employees and deserve the same benefits, protections etc.
Just the idea of a "conversion interview" seems nuts. Interviews are a way (albeit imperfect) for you to gauge the likeliness that a candidate would succeed in a position.
If you've already worked with the candidate, you already know this so there's no point in having an interview.
Interesting. I haven't thought too much about C2H in particular, but it seems like it might just kick the can down the road instead of solving the root problem; The root problem is human nature.
My favorite interview experience of all-time was essentially a two day contract. The company listed a couple of simple tasks in their codebase that didn't need a lot of context to complete. And there was no pressure to complete all of them — it was simply, pick a couple that you think you can accomplish over two days.
I put up a few PRs, then a final assessment was a discussion that was essentially, "Now that you've seen our codebase, what are your thoughts on how we could improve our architecture, etc.?"
I was paid for my time as well (because I was legally able to accept payment at the time). I think that's actually a larger hurdle — companies that disallow contract work that prevent engineers from getting paid for this type of interviewing, although I suppose it's in their best interest.
How does C2H get rid of interviews if there are more candidates than roles to fill? Surely you need to filter through anyway. At that point, C2H has the downsides of a permanent position (having to pass an interview) without the benefits of stability, health insurance, holidays, ...
Besides, from the hiring company perspective, only unemployed people or people who really hate their jobs would end up sending their CVs. The competent people who are currently happy where they are would never try C2H. So they are missing a lot of potential good candidates that way.
We provide business insurance coverage for anyone on contract through Facet. For health insurance, we recommend people just use COBRA to keep the insurance they had at their last company. You have to pay for it out of your own pocket, but you just build that in to your hourly rate that you charge.
If I was told that from a company I was looking at, I would drop them like a hot rock. Health insurance is not optional in the US, and COBRA is a giant ass-pain. This really sounds like very little benefit to me for a whole lot of benefit for the hiring company.
I would consider C2H if you were willing to offer three months full severance pay and health insurance in the event that you decide to lay me off at the end of the contract.
Some companies might do this, but this hasn't been our experience. It's the opposite. Companies VASTLY prefer full-time employees for software developers because it is so costly when they leave. They want devs to stay forever. They almost always convert contractors to FTE within the first couple fo months. They want to get the golden hand-cuffs in place ASAP.
> Companies VASTLY prefer full-time employees for software developers because it is so costly when they leave.
Companies whose core business is software development probably do, some other companies have almost entirely outsourced development, even where they have very large ongoing custom development needs.
Counterpoint: I used to be a contractor and took C2H positions to see if I wanted to work with these people long term. Most of the time, I was happy to see the door when the contract ended, though all of them offered a conversion.
There was one where I converted to full time, and then we got hit with the dot com crash, so that sucked.
That seems like a bad deal for the company. Even though the person is a contractor, you just trained and ramped them up for the last few months. Now, when they are most productive, you are going to let them go, and replace them with somebody who you will have to train and ramp up all over again.
Why on earth would I quit my job or take days(?) off just so I can apply for a contract position? This would be strictly for unemployed software engineers, or truly desperate ones that needed to get out of their current job ASAP.
Yea, I'm in the same boat. Absolutely no reason for me to leave a stable job (even if I don't love it) for a C2H position. There is literally zero benefit to me as an employee to do C2H.
Yeah, that's the part that sounds crazy. The benefit is you get to try them out first and you can negotiate a higher salary after you become indispensible. If it doesn't work out, you move on to the next C2H.
Right, that doesn't sound like much of a benefit to me, it sounds like a negatives. I don't think the best caliber engineers would take an offer like this, this sounds like, as I said, an option for unemployed engineers or desperate ones.
Especially in this environment, it could be weeks or months before the next C2H, especially with so many more engineers being laid off. There could be a ton of people competing for a single job.
Also, negotiated a higher salary when THEY hold the cards because now you need to find a new job? That's insane.
Yeah I dunno about that... a long (or even short) list of 6-12 month C2H gigs that didn't turn into full-time jobs screams trouble -- either you're a jerk, or you're bad at the tech.
If you're consistently swinging from contract to contract you're a freelancer, and you should be arranging contracts accordingly, not letting headhunters/recruiters control the playbook by dangling full-time employment.
I agree with the grandparent: C2H usually means you're unemployed, or you want out of your current gig badly, or you're aiming slightly higher than you're qualified; if you're qualified for the role and already have a job then they should be willing to take you on from the get-go.
As a candidate, I'd rather get a non-insignificant RSU grant up front, with a vesting schedule that begins day 1, than play the will-I-actually-be-brought-on-full-time game.
Companies have no incentive to bring you on full time, either. They can lie and tell you that you will at the end of the term, but it'll either be met with "we do not need this position anymore" or continual contract extensions because the market is suddenly unfavorable, there's no headcount, or some other excuse.
I can’t imagine how anyone would give up their employer-provided health care (which is all we have in the US) during a pandemic to go into a contract-to-hire scheme. That might have made sense last year but it definitely does not now.
There is something to this idea, but the discount on the first few months of work as an opportunity to "prove your value" doesn't make any sense. If your value isn't sufficient, they shouldn't renew or take the next step. The C2H process already excludes the value of many valuable benefits.
You're actually paid more cash during the contract period because you have additional expenses. You wouldn't be working for less.
However, it is likely you'll be able to negotiate a higher base salary when you convert than you would have been able to negotiate if you had hired on directly as a salaried employee, because it would cause them extreme pain to try and replace you.
Yeah, I wouldn't relocate for a C2H job either, unless it was a dream job or something. I think in those cases it would be best to opt for salaried and just deal with the current technical interview process.
This C2H approach seems to ignore the fact that companies have a genuine preference for paying with stock options that they can pay for by issuing new stock rather than expending cash on hand in the US, something which can be a scarce resource at times given a combination of cash flow situations and US tax law. Stock options on short-term contracts tend to be less feasible.
Everybody does not in fact know that "actually working with someone" is the "only" way to get an accurate evaluation of an engineer. There are recruiting/qualification disciplines besides temp-to-hire and whiteboard interviews.
Temp-to-hire is problematic for its own distinctive reasons:
* It's difficult to generate apples-to-apples comparisons of candidates in a temp-to-hire setting because the engineering workload isn't constant; candidates are getting the luck of the draw with whatever the tasks are during their contracting period.
* There's as much subjectivity built into the projects candidates get during their temp-to-hire as there are in whiteboard interviews, so culturally preferred candidates are just as likely to get fast-tracked in a temp-to-hire process as with interviews.
* Interview processes routinely evaluate many candidates for a single opening --- that's expected in basically all hiring, across every industry --- and can't reasonably offer temp roles many candidates simultaneously, so in effect temp-to-hire just pushes the qualification problem to a higher level of the funnel, where the recruiting process decides who to extend temp offers to.
* Temporary contracts draw out the hiring process and potentially make it take far longer to finally fill a role than other processes do; you're required to trade accuracy of evaluation against the time taken to fill a role, bearing in mind that when candidates wash out of their temp contract, you likely have to start all over again with another candidate, making it even more important to pre-screen candidates before offering roles, which just recapitulates the whole problem.
* The tech industry is notoriously bad at evaluating on-the-job performance too; every developer I've talked to has stories of dead weight team members† that were kept on the team interminably because no process existed to evaluate their performance accurately. There's a whole cottage industry of people who have failed up† through role after role, because there's no resume difference between people who phoned in a role† for a year or two and then decided to move on, and people who did well.
* Perhaps most importantly, temp-to-hire is deeply unfair to candidates; a career norm in tech is that people secure their next role while winding up their previous one (in fact, that's a norm in most white collar industries, which is why there's so much written career advice about how to handle counteroffers). Taking a temp-to-hire position requires a candidate to forego income security for a chance at a job; when that job doesn't work out, they're now in a distressed position when looking for their next job.
(I'd add, though it's a nit, that temp-to-hire positions virtually never compensate appropriately; contractor wages are routinely 2x+ what FTE wages are, in large part precisely because of what makes temp-to-hire so attractive: freedom to fire on a moment's notice with no commercial/reputational cost.)
On principal, I don't think "temp-to-hire" is the same thing as contract-to-hire. With a contract to hire roles, you are filling a full-time position on your team with someone that is paid differently. They are treated as a new hire.
I wouldn't take a "temp-to-hire" or a job with a trial period either.
Now before you dismiss the idea because you are "too good" to do C2H hear me out. Everyone knows that actually working with someone on the job is the only way to get an accurate evaluation of an engineer. Everything we currently do in technical interviews (whiteboard coding, pair programming, take home assignments, etc) are just attempts to recreate a working environment. If you are hiring a contractor first, you can do a light-weight interview process and then just bring them on and start working together.
As the dev being brought on you can prove your value before you negotiate your salary. You can also try out the company and manager before committing to an offer.
It's crazy, I know, but I think it would drive dev salaries up if it weren't so hard to change jobs because of the tech interview gauntlet we've created for ourselves.
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