SamFree tool · no signup
Employee cost calculator for small businesses
The salary is only the start. Add employer taxes, pension and the costs of putting someone on the road to see what an hour of their time really costs.
An employee costs more than their wage. Add employer Social Security and Medicare (7.65%), federal unemployment tax of up to $42 a year, state unemployment tax, workers' comp, paid time off and benefits.
Hours straight onto the invoice
Your team logs hours in Sam, and billable time becomes an invoice in one click.
Start freeHow it works
Employers pay 7.65% FICA (6.2% Social Security up to the wage base, plus 1.45% Medicare), federal unemployment tax (FUTA, usually 0.6% of the first $7,000 after the state credit) and state unemployment tax at a rate your state sets. The hourly cost divides the year's cost by the hours worked after paid time off.
Worked example
$50,000 in wages adds $4,056 of employer payroll taxes, plus $9,000 of other costs: $63,056 a year, or $31.53 for every hour worked.
Questions
Why is the hourly cost so much higher than the hourly wage?
Because you pay for holidays and taxes, and the costs of tools, vehicle and training, but only bill for the hours worked.
How do I use this when pricing?
Charge more per billable hour than the cost per hour worked: not every hour worked is billable. The day rate calculator helps.
What should go in other costs?
Workers' comp, health insurance, truck, tools, training and phone.
Sam for your business: Locksmiths · Pest control companies · Cleaning companies · Plumbers · Electricians · HVAC contractors · all industries