Initial labor
20%
Wages divided by today's sales
Free employer calculator
See what labor really costs the business
Enter what the business made today and how much labor cost. The calculator builds out the employer side of payroll and shows the estimated true labor rate.
wages first
loaded labor
sales target
This is a planning tool, not tax or payroll advice. Use your actual payroll and benefit costs when available.
Employer labor calculator
Today's true labor rate
What happened today?
Enter the two numbers you already know. The calculator builds the employer costs from there.
Today's gross sales before expenses.
$$3,000
$250$15,000
Gross wages for everyone who worked today.
$$600
$50$5,000
The rest is built in
The planning model adds employer Social Security and Medicare, then an allowance for unemployment, workers comp, benefits, and insurance.
20% labor target
What today needed to make
From wages alone
$3,000
sales needed today
From true labor cost
$3,540
sales needed today
To hold true labor at 20%, today needed $540 more in sales.
After payroll tax
21.5%
Adds 7.7% employer FICA
True labor rate
23.6%
3.6% over target
Build the true labor cost
TodayGross wages$600Employer Social Security + Medicare+ $46Other employment trimmings+ $62Estimated true labor cost$708
This uses an 18% total employer-cost planning allowance. Replace the estimate with actual payroll reports when making staffing or tax decisions.
What today's sales support
At today's sales, a 20% true labor target supports about $508 in gross wages after leaving room for employer costs. Without those costs, it looks like $600.
What you need to make to warrant this
$3,540
in sales today to support $600 in gross wages at a 20% true labor rate.
Why two labor rates?
The first payroll number is not the final labor number
A daily labor calculation usually starts with gross wages divided by sales. The business also has employer-side costs that do not appear in gross pay. The calculator starts with the two numbers an owner already knows, then makes each added layer visible.
1. Initial
Start with the gross wages that go on employee paychecks.
2. Add-ons
Reserve for employer taxes, insurance, benefits, and related costs.
3. Sales target
Divide the true labor cost by 20% to find the sales today needed.
Questions
Employer labor cost basics
What is a fully loaded labor cost?
Fully loaded labor starts with gross wages and adds the costs paid by the employer, such as payroll taxes, unemployment insurance, workers compensation, benefits, and other employment expenses.
How does the calculator find the sales needed for 20% labor?
The calculator divides today's labor cost by 20%. It shows one target using gross wages alone and another after estimated employer payroll and employment costs.
How are the added employer costs estimated?
The calculator uses a visible 18% planning allowance on top of gross wages. It includes 7.65% for employer Social Security and Medicare, with the remainder illustrating unemployment, workers compensation, benefits, insurance, and related costs. Actual costs vary by business.
Is the employer labor calculator free?
Yes. It is free to use in your browser and does not require an account.
CafeTally
Make the labor target part of the whole business picture.
CafeTally brings sales, ingredients, receipts, inventory, and margins together so owners can see where the money is really going.