What does an Employee REALLY Cost?

Even VERY part-time employees, with no paid breaks or other paid time off or any benefits, will cost substantially more than their hourly rate. Initially, there is the cost of hiring and training, which, depending on turn-over, can be quite high for a company. However, once an employee is hired, there are several ongoing costs which need to be factored in. including the employer's share of FICA, workers' compensation insurance, unemployment insurance, plus any benefits such as health insurance. I've created an employee cost calculator which will allow you to estimate the percentage of 'working' time to total time you are paying an employee for, as well as the additional cost above their hourly rate or salary for FICA, FUTA, SUTA, health insurance, or other benefits. It will also give you an idea of what the equivalent rate for a subcontractor would be - however, please note there are several issues to consider when using a subcontractor to do work that might also be done by an employee. See the article Employee vs. Subcontractor: What's the Difference and Why You Should Care for more information on this.

More Information: What's the Real Cost of an Employee?

Tagged With: 1099 Subcontractors,  Employees,  FUTA,  General Business,  Health Insurance,  SUTA,  Workers' Compensation Insurance