Free HR calculator
True Cost of an Employee Calculator
Salary is only part of the story. Add payroll taxes, every benefit, workers’ comp, paid time off, payroll admin, and overhead, and the real number is usually 1.25 to 1.4 times pay. Use this to budget a hire, set a bill rate, or sanity check an offer.
Before you start
What you will need. Annual base salary, Hourly wage, Scheduled hours per week, Bonus or commission (per year)
Pay
Benefits
Additional benefits and operating costs
Time off and tax assumptions
First-year one-time costs (optional)
Fully loaded annual cost
Where the money goes
The method
What goes into the true cost of an employee
Base pay is the part everyone sees. The fully loaded cost adds everything you spend to keep that person employed for a year. For most small employers it lands between 1.25 and 1.4 times pay. Here is what this calculator counts.
How this is calculated
Cash pay
Base salary or wages, plus any bonus or commission. Variable pay is taxable wages too, so it also drives the payroll taxes below.
Employer payroll taxes
On top of an employee’s own withholding, you pay a matching 7.65% in Social Security and Medicare. Then federal unemployment (FUTA) and your state’s unemployment tax (SUTA). FUTA and SUTA apply only to the first slice of wages each year.
Benefits
Employer-paid health insurance is usually the largest add-on after pay. Dental, vision, life, and disability coverage and a retirement match stack on top.
Workers’ comp, admin, and overhead
Workers’ compensation is a percentage of wages that varies widely by industry and state. Payroll or PEO fees, software, equipment, training, and workspace round out the ongoing cost.
Ongoing versus first year
The headline number is the ongoing annual cost. The optional first-year view adds one-time recruiting, onboarding, and equipment setup, which only hit in year one.
Carry this into the decision
Keep this analysis in Excel
The in-depth Excel version is a file you keep: set your payroll taxes, benefits, and overhead once, reuse it for any role, duplicate it to compare offers, and read open formulas instead of a black box.
$29. 30 days. Reply to your receipt or email support@truestephr.com for a full refund. No form or explanation is required, and you keep the files.
Related
More free tools and the notes behind them
Put your own numbers in and read the result on screen.
Put your own numbers in and read the result on screen.
Put your own numbers in and read the result on screen.
Put your own numbers in and read the result on screen.
Put your own numbers in and read the result on screen.
Put your own numbers in and read the result on screen.
This tool estimates from the figures you enter. It is general information rather than legal, tax, or accounting advice, so check the result against your own records before you rely on it.