did a contractor-to-FTE conversion last fall and negotiated a better outcome than i expected. some things are very different when you already know the team.
what's in your favor
you're not a risk. they've already seen your work. conversion offers happen because they want to keep you. that shifts the power dynamic considerably compared to a cold offer from an external search.
they know what you cost as a contractor (your rate). they know you've been productive. and they want to avoid the pain of replacing you.
what's working against you
psychologically, you might feel loyal and not want to "push back" on people you like. don't let that derail the negotiation. the team likes you AND the company should pay you fairly. those aren't in conflict.
also: some companies discount conversion offers because they assume you want FTE stability badly enough to take a haircut. don't accept that framing.
the comp translation math
if you're on a 1099 hourly rate, the comparison to W2 salary is not 1:1. as a contractor you're paying self-employment tax (~15%), your own health insurance, no PTO, no 401k match. when i modeled it out, my effective contractor rate needed a 30-35% premium over an equivalent W2 salary to break even.
i showed this math (politely) to the recruiter. not as a gotcha, just as "here's how i'm thinking about the comparison." they moved up the base offer and added a decent sign-on.
what i asked for specifically base salary at band mid (not floor) sign-on to bridge the PTO accrual gap in year one (no PTO payout for contractor hours on conversion) confirmation in writing that my contractor tenure counted toward vesting cliff
that last one is rarely offered proactively. always ask.