Dominic is the CEO of Lawpath, dedicating his days to making legal easier, faster and more accessible to businesses. Dominic is a recognised thought-leader in Australian legal disruption, and was recognised as a winner of the Australian Legal Innovation Index and recently a winner of the LexisNexis 40 Under 40 (APAC).
The Lawpath Cost of Employment Calculator (below) is a free tool that shows what a new employee will cost your business each year. Enter a salary and a few details about your business, and this cost of employment calculator adds super, payroll tax, workers comp, leave loading and your hiring costs, then gives you a total.
Most owners budget for the salary and meet the rest later, usually when the first super payment lands. A $65,000 hire can cost over $75,000 a year. Get the full number before you make the offer.
What is the cost of employment calculator, and who is it for?
It’s a planning tool for anyone about to take on staff: a sole trader making a first hire, or a small team weighing full-time against casual for its next role. If you’ve asked “what’s the cost of employing someone in Australia, all in?”, it’s for you.
It answers one question: what does this person cost per year, week and hour once everything on top of salary is counted? You need that number to set a salary and check your cash flow.
How to use the cost of employment calculator
Here’s what you enter in the calculator above, in order.
- Salary. Enter the annual salary before tax. For a part-timer, enter their actual salary. For a casual, enter their annual pay with the 25% loading included, because the calculator doesn’t add it.
- Employment type. Choose full-time, part-time or casual.
- State or territory. Pick where the employee will work. Each state sets its own payroll tax threshold and rate.
- Total wage bill. Enter your business’s total annual wages, including this new hire. The calculator uses the figure as you type it.
- Workers comp rate. It’s pre-filled at 1.5%. Replace it with the rate from your policy or insurer.
- Leave loading. Turn the toggle on if the award or contract pays 17.5% loading, and off if it doesn’t. Casuals get none either way.
- Extra costs (optional). Add training, equipment and recruitment costs. Training is pre-filled at $500, which you can change or clear.
Change one input at a time to see which cost moves your total most.
What do the results show?
The calculator gives you four numbers. The total annual cost is the salary plus every on-cost and extra. The cost above base salary shows the gap in dollars and as a percentage, with training, equipment and recruitment counted in full in year one. The weekly cost is the total divided by 52, and the hourly cost divides that again by 38.
The hourly figure always assumes a 38-hour full-time week, whatever employment type you choose. For a part-timer or casual on fewer hours, divide the weekly cost by their actual weekly hours to get the real cost per hour worked.
What costs does it add to the salary?
Super. The super guarantee is 12% (it has been since 1 July 2025, according to the ATO). The calculator applies it to salary only, up to the 2026–27 maximum contribution base of $270,830. Under Payday Super, from 1 July 2026, contributions must reach the fund within 7 business days after payday.
Payroll tax. It only applies when your total Australian wages pass your state’s threshold, and thresholds and rates vary (the business.gov.au payroll tax guide links to each revenue office). A first or second hire? You’re probably well under. Over the threshold, the calculator applies the state’s 2026–27 starting rate to the hire’s salary plus super. The calculator uses that starting rate for every business over the threshold, so treat the line as an estimate. Our guide to payroll tax goes deeper.
Workers comp. Every state and territory requires employers to insure employees for work injuries. Safe Work Australia’s national standardised average was 1.59% of payroll in 2023–24. The calculator applies your rate to salary. Its 1.5% is a starting point you can edit, since real rates vary by industry, claims history and insurer.
Leave loading. Many awards pay 17.5% extra on annual leave, but as the Fair Work Ombudsman explains, it depends on the award, agreement or contract. With the toggle on, the calculator adds 17.5% on four weeks of the salary you enter. Part-timers follow their lower salary, and casuals get none.
Leave already in the salary. Full-time and part-time employees get 4 weeks’ paid annual leave and 10 days’ paid personal leave a year (pro rata for part-timers). That leave comes out of the salary you’ve entered, so it adds no dollars. It costs you time instead, about six weeks a year with them away.
Casual loading. Casuals get no paid annual or personal leave. Most awards pay them a 25% loading instead, which is why you include it in the salary you enter. They still get super.
Cost of employment calculator: a worked example
Illustrative example: a $65,000 full-time employee in NSW, at a business under the payroll tax threshold, using the calculator’s pre-filled defaults (1.5% workers comp, $500 training, no equipment or recruitment costs).
| Cost | How it’s worked out | Amount |
|---|---|---|
| Base salary | $65,000 | |
| Super | 12% × $65,000 | $7,800 |
| Leave loading | 17.5% × 4 weeks’ pay ($5,000) | $875 |
| Workers comp | 1.5% × $65,000 (default) | $975 |
| Training | Pre-filled extra | $500 |
| Payroll tax | Under the threshold | $0 |
| Total annual cost | $75,150 | |
| Above base salary | $10,150 (15.6%) | |
| Weekly | $75,150 ÷ 52 | $1,445.19 |
| Hourly | $75,150 ÷ 52 ÷ 38 | $38.03 |
So this hire costs about 15.6% more than salary, training included. Move the same person to a business over the payroll tax threshold and the extra cost rises to about 20% or more, depending on the state.
Now count leave. If this employee takes 4 weeks’ annual leave and 10 days’ personal leave, they work about 46 weeks. $75,150 ÷ 46 is about $1,634 for each week they’re actually at work.
Run it more than once. Compare full-time with casual for the same role, or test two salary levels before you advertise.
It helps with cash flow too: with super due every payday, the weekly cost shows what each pay run takes out.
Cost of employment calculator vs pay calculator
Our two calculators look at the same job from opposite sides. The cost of employment calculator shows the employer’s side, what the hire costs your business. Our Pay Calculator shows the employee’s side, their take-home pay after tax.
What should you sort out before you make the offer?
Your employment contract locks a lot of the cost in, from the award to whether the salary absorbs loadings. Start with our employment contract templates or the casual employment agreement, and read our guide on how to hire an employee. If Payday Super deadlines sound like someone else’s job, see our payroll services.
Frequently asked questions
Is the cost of employment calculator free?
Yes. It’s free to use and there’s no login or sign-up.
How much does it cost to employ someone in Australia on top of salary?
In our illustrative $65,000 full-time example, about 15.6% under the payroll tax threshold, including $500 of training, and about 20% or more over it, depending on the state. Your award, workers comp rate and extras change the figure.
Why is the hourly cost lower than I expected for a part-timer?
Because it divides the annual total by 52 weeks of 38 hours. For someone on fewer hours, divide the weekly cost by their actual weekly hours instead.
Is the result exact?
It’s an estimate from what you enter and the general rules. Payroll tax uses each state’s starting rate only, and overtime, allowances, penalty rates and grouping can change the real figure. Treat it as a planning number.
Know the full cost before you hire
A bigger number than you expected is useful. It lets you plan the hire with your eyes open.
Work out the cost of employing someone in Australia in a couple of minutes with the free Cost of Employment Calculator above.
Get your Full Time Employment Agreement legal document for free.
This article is general information only and isn’t legal, tax or financial advice. Rates and entitlements change, so get advice for your situation.
