Myth About Consulting Jobs Versus Permanent Jobs in an H1-B – Outsourcing Market

In an effort to reduce costs of fielding consultants the Major IT Consulting organizations, which we refer as “The Prestigious Ones”, offer “Permanent Employment” with “Benefits” which comes with a low salary.

Anyone offering “Permanent Employment with Benefits” for consulting assignments is taking the consultant for a ride. The reality is that consulting assignments have a beginning and an end. For these reasons the ultimate Clients are willing to pay a substantial premium over the cost of their own employees. When the assignment is over, the Consulting organizations will make every effort to have the employee transferred to another assignment, but such propositions are not based on certainty but in the hope that the exploitation may be able to continue. When this fails, the Consultant finds themselves dismissed.
Every Consultant should expect premium compensation in their hourly rate instead of salary (salary employees work many overtime hours without compensation) and that hourly rate should include an amount taking into consideration the costs of self provided benefits, the fact that there are gaps in moving from one assignment to another and that there should be a premium for the difficult life (family wise) of a consultant that needs to travel away from home. To settle for less means that someone is exploiting the Consultant as the organization will keep the premium for his/her sacrifices.
It is important for the Consultant to pay for their own “Benefits” as when they move to the next assignment it might not be with the same organization that provided the previous assignment. By doing this the Consultant expand its Market and make it possible to achieve substantial earnings in keeping with the effort.
To make things worse the “Prestigious Ones” are attempting to replace the USA based Consultant by outsourcing offshore work which services the USA based clients.

Blown Offshore to Mysore
Obviously this is tax evasion as the offshore resources do not pay any Federal, State, Social Security or Medicare and the organization hiring do not have to match the Social Security and Medicare taxes as if the work was performed by a USA based person.
We founded Peningo Systems to combat this problem of multiple layers of markups that ends up in between consultant and the end client.
Peningo Systems solution to this problem is to bypass these “Offshore Outsourcers” and with the support of Peningo Systems Inc, contract directly between the Consultant and the End Client, thus, eliminating these ”Prestigious Ones” excessive Mark-ups and allowing for increased compensation for the Consultant while lowering the costs for the End Client.

With the Outsourcing IT Jobs OffShore and/or using employees who are H1-B Visa or L-1 Visa holders, many times the cost of “Services” to the “End Client” is slightly effected. Between huge markups by some of the Larger Outsourcers and/or the combination of multiple layers of subcontractors involved in providing the IT Services with their respective markups, the cost to the “End Client” is still high. All the Offshoring of IT jobs and hiring of H-1Bs & L-1 Visa holders offers is higher profit margins for the Outsourcers…….WHILE PROVIDING LOWER QUALITY OF SERVICE TO THE END CLIENT!!! It is very true the old saying that Power corrupts and that Absolute Power absolutely corrupts. It is time for the Consultant and the End Client to bypass these “Prestigious Ones” which every day are looking more like ruffians and knaves.

To All Americans:

If you wish to voice your opinion, you are welcome in commenting to this post. If you wish to voice your opinion to a greater authority….Congress and/or your State Representatives, please go to the Peningo Advocacy Assistance Page.

Peningo Systems supports and provides Consultants with expertise in many areas including:

To see Peningo Systems areas of expertise, please go to the Peningo Technical Areas.

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About Edward Pellon

About Peningo Systems ( ) Peningo Systems and it founders have been involved in IT Consulting for over 30 years. Our goal is to support the individual IT Consultant by providing an avenue for them to be in contact directly to the end client. By doing this we reduce the many layers and tiers of organizations that are involved with placement of an IT Consultant. By reducing these layers and tiers, cost can be significantly reduced to the end client, while still providing the room for the Consultant to increase their revenues. Peningo is a for profit organization. We have decided to earn our “keep” by advocating, establishing and supporting a “market place” where the IT consultant and the “end client” may function without the interference of tiers of “prestigious” companies that bring to the consulting assignment excessive Markups and very little else. At Peningo we feel that the IT Consultant should be paid adequate rates commensurate with their skills and the personal sacrifice inherent in the life of an IT consultant. These allows us to field capable, motivated consultants that will contribute successfully to the “end client’s” systems development and implementation, while attracting to the IT industry new talent that otherwise would go to more lucrative pursuits. With the elimination of the “prestigious ones” there will be costs savings that will allow for the consultant to be paid a higher rate and for the client to reduce its costs. Both objectives represents Peningo’s Mission.
This entry was posted in Contract Direct to the End Client, H1-B Visa, H1B, IBM Tivoli, Intellectual Property, IT Outsourcing, L1 Visa, Offshoring, Offshoring Intellectual Property, OffShoring Jobs is Tax Evasion, Outsource the Outsourcers, outsourcing, Outsourcing Intellectual Property, Software Copyright, Software Intellectual Property, Tivoli, Tivoli Access Manager, Tivoli Identity Manager, WebSphere, WebSphere Commerce, WebSphere Consulting, WebSphere Portal. Bookmark the permalink.

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