So...... you want to be a Contract Pilot?
note that this article was written several years ago. Daily rates have gone
up since then. You can find a range of daily rates published on this website.***)
(***Please note that this article was written several years ago. Daily rates have gone up since then. You can find a range of daily rates published on this website.***)
With the recent interest in this industry, I feel I should write a brief overview of the reality of being a full-time contract pilot. Let's start here:
If you think you can buy a type-rating on an aircraft with no prior experience, charge a high daily rate, have all the holidays and other important dates in your life off when you want, and generally live the good life when and how you want..... then you are mistaken and this business is probably not for you. Are you still with me?
There are many types of contract pilots. Those who fly the short trips for many operators, those who have only 1 or 2 customers and generally accept longer trips, and those who contract for 6 months or more with one operator. Some guarantees may or may not be given based on whether the customer pays for some or all of your training. Usually, the training expense is 100% paid by the pilot in this business.
The many reasons operators use contract pilots are to fill-in while some of the full-time staff is on vacation, training, or other events. Contract pilots are often called in when the regular staff is off for the holidays. The holidays are generally a busy time for us. In the past year, I've flown on both Christmas and New Year's Day. If you can't be available during these times, you will lose clients. Contract pilots are also used to spool up a flight department that purchases a new aircraft type and is seeking outside expertise. You may fill-in just once for an operator, or develop a regular working relationship that continues for years. Every flight department operator is different. If you are working for an operator and your primary concern is filling your hip pocket with all that daily rate cash...then this business is again, not for you. The primary objective of all "real" contract pilots is to help the operator complete his mission. A contract pilot is a professional pilot/business person dedicated to this goal.
So what kind of pilot does well in this business? Someone with good common sense, a self-starter, an exceptional aviator (who keeps abreast of industry developments), has respect for fellow contract pilots and the customer, keeps confidential information confidential, is a good business person, and one who has that all important entrepreneurial spirit. If this doesn't sound like you... don't quit your day job.
What kind of income can you make? Let's look at some figures based on a G4 Contract Pilot using the $700/day daily rate:
15 days/month = $126,000 annually. (This is a high average days/month, most don't fly this much. Other aircraft daily rates are lower than $700)
$21,000 annually for a full-service FSI contract.
$ 3,000 Travel, hotel, meals while attending 2 recurrent sessions.
$ 3,000 Travel, hotel, meals while attending 135 annual training sessions.
$ 5,000 annually for medical/life benefits for you and your family.
$ 1,000 Legal/Accounting Expenses for your business.
$ 800 Industry Memberships, publications
$ 600 Uniforms/Clothing
$ 3,000 Office Expenses (Phone, fax, supplies)
$ 800 annually to maintain a corporate entity. (Certainly, you wouldn't operate your contract business as a sole-proprietor in this world of litigation...would you?)
Oh...you say you want to save some money for retirement?
Those of you that are still with me and want this lifestyle, treat your business like a business. You will present your proposal to prospective customers, outlining your rates and policy, and accept assignments with a written contract in place. If you are the type person who accepts "whatever an operator wants to pay" and has no written contract in place outlining the expectations of both sides, you are not taking the business seriously and should consider doing something else. Of course, you must be competent at marketing your services or you'll never have a customer to talk to in the first place.
Once you decide to "go for it", having done all your homework and have setup your business properly, you must conduct yourself as a professional. If you plan on undercutting your fellow contract pilots with a lower daily rate just to get some flying, you will soon find yourself "out of business". Your business will only grow when you operate with integrity and respect. This business is very small and many contract pilots network the overflow work with each other. There are many so-called contract pilots out there, but unfortunately, many run for the safety of the full-time job once the first FSI Recurrent comes due. These are the individuals who are not really serious about this business and have no problem hurting someone else's contract business and making a bad name for themselves and this industry. I get calls from these types weekly asking if I know of any full-time jobs. Of course, I always do... but, if that's what you want, then you have to find your own way. I am in the contract business.
So...... Do you still want to be a Contract Pilot?
California Jet, LLC
NOTE: Independent contractor status as defined by the IRS is open to interpretation. I highly suggest you talk with your tax accountant/attorney. Some rulings have thrown out the "independent staus" relating to the IC Pilot because the employer "controls your time" while working for him. Don't take this as legal advice. Just check it out for yourself before you get in a jam.
In addition, those operating as "sole proprietors" are really hanging it out. Everytime you go out the door you put your family's financial security at risk. Of course, if you are operating as a corporation, you can still be sued, but there is some shield there. If you aren't operating your business as a corporation (an easy thing to do), the employer must pay you on a 1099 or W2 (interpretation again). Corporations are not subject to that type of payment as you are just like any other vendor they use. You are then an employee of your own corporation. The corporation is the vendor of the customer. Get some good legal advice. This note only serves to get you thinking and is not intended as legal advice directly or indirectly.
One other thing.... use a comprehensive contract before accepting any trip. Don't use someone else's contract, either. What applies to one may or may not apply to you. Don't go cheap here. Get an aviation attorney to write one for you.
Run your business as a business. If you don't...you will not be able to compete with the professional IC Pilots who are doing so. Operators shy away from using contract pilots who are "sorta in business". Enough said.