Employee Cost Calculator
Total Employee Cost
Calculate the full cost of employing someone including benefits, taxes, and overhead
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Employee vs Contractor
Compare the cost of a full-time employee vs independent contractor
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Formula
Total Cost = Salary + Benefits + Payroll Taxes + Retirement Match + Overhead | Burden Rate = (Total Cost - Salary) / Salary × 100
Frequently Asked Questions
What is the true cost of an employee?
The true cost is typically 1.25x to 1.4x the base salary. This includes employer payroll taxes (7.65% for FICA), health insurance ($7,000-$22,000/year), retirement contributions, workers comp, and overhead like equipment and office space.
What is a burden rate?
The burden rate is the percentage of additional costs on top of base salary. If an employee earns $65,000 and total additional costs are $20,000, the burden rate is 30.8%. Average burden rates range from 25-40%.
What employer payroll taxes are required?
Employers must pay 6.2% Social Security tax (up to the wage base limit), 1.45% Medicare tax, federal unemployment tax (FUTA) of 0.6%, and state unemployment tax (SUTA) which varies by state.
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