What this calculator does
- ✓Combines wage or salary, statutory payroll burden, retirement, and employer-paid employee costs.
- ⏱Reduces available work hours for paid time off and non-productive time to estimate productive hours.
- $Calculates the true cost of one productive labor hour, then applies overhead and profit margins.
1. Employee & Compensation
- ●Enter the employee name and an effective date so the calculation can be identified later.
- $Select Hourly or Salaried, then enter the employee's current wage or annual salary.
- ⏱Enter expected hours per week and weeks per year. These values establish the employee's annual available hours.
2. Statutory Payroll Burden
- %Enter the employer rates that apply for Social Security, Medicare, SUI, FUTA, and Workers' Compensation.
- !The calculator uses the percentages you enter. It does not automatically apply payroll tax wage bases, caps, or state-specific rules.
- ✓These costs are treated as employee-related labor costs before general company overhead is added.
3. Retirement Contribution
- $Choose Fixed when the employer contributes a specific dollar amount. Use the Mo/Yr control to identify the period.
- %Choose % Base when the contribution is a percentage of base compensation.
- ✓Annual retirement cost shows the calculated annual employer contribution.
4. Employer-Paid Costs
- $Enter employer-paid costs such as health insurance, dental/vision, cell phone, tools, and vehicle costs.
- ↔Use the Mo/Yr slide to tell the calculator whether each amount is monthly or annual.
- ＋Use the two custom rows for employee costs that are not already listed. Enter both a description and an amount.
5. Productive Hours
- ⏱Enter paid holidays, vacation, sick days, and personal days.
- −For hourly employees, enter typical non-productive hours per workday, such as meetings, travel, setup, cleanup, or other paid time that cannot be billed directly.
- ✓The calculator shows available hours, PTO/holiday hours, non-productive hours, productive hours, and utilization.
6. Labor Cost Summary
- $Payroll-loaded rate adds statutory payroll burden to base compensation.
- $Total annual cost includes base compensation, statutory payroll burden, retirement, and employer-paid costs.
- $True productive cost equals total annual employee cost divided by productive hours.
- %Overhead margin adds the employee's share of general company overhead. The result is the Rate before Profit.
- %Profit margin is then applied to the Rate before Profit to calculate the Target billing rate.
Calculation sequence:
True Productive Cost ÷ (1 − Overhead Margin) = Rate before Profit
Rate before Profit ÷ (1 − Profit Margin) = Target Billing Rate
7. Save, Recall, Duplicate & Print
- ✓Save stores the current calculation in this browser. Give the saved calculation a clear name.
- ▣Saved opens the saved-calculation list. Click the row or the Open button to recall a calculation.
- ⧉Duplicate creates a copy that can be changed without altering the original saved calculation.
- ×Delete removes the selected calculation from browser storage.
- ▤Print creates a clean report with the employee name, effective date, calculations, notes, and Builder Resources copyright notice.
- !Saved calculations remain only in this browser on this device. Clearing browser storage may remove them.
8. Notes & Good Practice
- ✎Use Notes for special circumstances, rate sources, benefit assumptions, Workers' Compensation information, or other details needed to understand the calculation later.
- ✓Use an effective date whenever wage, benefit, insurance, overhead, or profit assumptions may change over time.
- !This calculator is a cost and pricing tool. It is not a payroll-tax filing or legal-compliance system.