Finance Lab
True cost of an employee
See what an employee really costs once superannuation, leave, insurance and on-costs are counted.
Total cost = base salary + super + workers compensation + payroll tax (where you are over the threshold) + other on-costs. Leave and public holidays are removed from the year to give the cost per productive hour.
Step 1 · Enter your figures
Every box starts with an example figure. Replace each one with your own — the result updates as you type. Nothing you type is sent anywhere or stored.
Annual salary or wage before on-costs.
The guarantee rate that applies. Enter it from the current published rate.
Premium rate for your industry, as a percentage of wages.
Enter nil if your wages are under your state's threshold.
Recruitment amortised, training, tools, phone, vehicle, software licences.
Annual leave, personal leave and public holidays combined.
Ordinary hours worked each day.
Step 2 · Read the result
Total cost each year
$108,150
- On-costs above salary
- $18,150
- On-costs as a share of salary
- 20.2%
- Cost per productive hour
- $62.41Total cost spread across the hours actually worked, after leave.
- Cost each month
- $9,013
- Superannuation for the year
- $10,800
- On-costs above salary$18,150
- On-costs as a share of salary20.2%
- Cost per productive hour$62.41
- Cost each month$9,013
- Superannuation for the year$10,800
What this answer rests on (11)
- Base salary$90,000
You entered this
Annual salary or wage before on-costs.
- Superannuation rate12.0%
You entered this
The guarantee rate that applies. Enter it from the current published rate.
- Workers compensation rate1.5%
You entered this
Premium rate for your industry, as a percentage of wages.
- Payroll tax rate0.0%
You entered this
Enter nil if your wages are under your state's threshold.
- Other costs each year$6,000
You entered this
Recruitment amortised, training, tools, phone, vehicle, software licences.
- Paid leave days each year32
You entered this
Annual leave, personal leave and public holidays combined.
- Hours in a working day8
You entered this
Ordinary hours worked each day.
- The rate you entered is the one applied. No rate, threshold or statutory figure is supplied by the platform — confirm it from the current published source before you rely on the result.
The calculator applied this
- A working year of 260 days is used before the paid leave days you entered are removed.
The calculator applied this
- Payroll tax is applied to salary and superannuation at the rate entered; thresholds and grouping rules differ by state and are not applied.
The calculator applied this
- Fringe benefits tax, bonuses and overtime are excluded unless you included them in the figures entered.
The calculator applied this
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Save to my workspaceRead this before you rely on the result
- Payroll tax rate is at the lowest figure this calculator accepts. The result reflects that limit, not a figure below it.
What this means for you
What an employee actually costs once superannuation, insurance, leave and on-costs are added to the salary.
How to read it
- The cost per productive hour is the number to price your work from, not the salary.
- On-costs as a share of salary is the figure most owners underestimate.
- Compare the hourly cost with what you charge for that person's time.
Watch out for
- Forgetting that leave is paid time you do not sell.
- Payroll tax thresholds and grouping rules, which differ by state and are not applied here.
- Leaving out tools, vehicles, software and training, which are real costs of employing someone.
Assumptions behind this result
- The rate you entered is the one applied. No rate, threshold or statutory figure is supplied by the platform — confirm it from the current published source before you rely on the result.
- A working year of 260 days is used before the paid leave days you entered are removed.
- Payroll tax is applied to salary and superannuation at the rate entered; thresholds and grouping rules differ by state and are not applied.
- Fringe benefits tax, bonuses and overtime are excluded unless you included them in the figures entered.
General information only. This calculator does not take your circumstances into account and is not financial, tax, legal or investment advice. Confirm every rate, threshold and figure with your own adviser before acting.
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Take this further
Members run this calculator on their own recorded figures, save the workings to their workspace, export them to Word or Excel, and read the lessons that teach the thinking behind the result.