Hourly pay and labor budget calculator

Test a proposed hourly wage against scheduled hours, employer costs and sales. Learn the difference between what is affordable, what is lawful and what is competitive.

Free to use without signup. Your financial inputs stay in the browser and can be saved to a file on your device.

What you will enter

Weekly net sales ($): Sales for a normal week, excluding sales tax and pass-through tips.
Total labor target (%): The share of sales your plan allows for all labor cost, including employer costs. Enter 30 for 30%.
Regular hours across employees (hours / week): Total hours up to 40 per employee. Take them from the shift planner, which splits regular and overtime employee by employee.
Overtime hours across employees (hours / week): Hours above 40 per employee, already identified per person. Enter 0 if nobody exceeds 40.
Estimated employer costs above wages (%): Your estimate of employer payroll taxes, workers' compensation, unemployment insurance and similar costs as a percentage of wages. This tool does not supply a tax rate.
Other fixed weekly employer labor costs ($): Benefits, payroll service fees or other labor costs that do not move with hours. Enter 0 if none.
Applicable hourly minimum you verified ($): The legal floor for this job, location and date, from the official source. Enter what you verified, not a national figure. Enter 0 only if you have not verified it yet: the tool then checks no rate against a legal floor and says so in the result.
Proposed average base hourly pay ($): The average base rate you are considering across the hours entered. Individual rates will differ by job.

The formula

Supported average rate = (weekly sales × labor target − fixed labor costs) ÷ (1 + employer burden) ÷ (regular hours + 1.5 × overtime hours). Cost at a proposed rate = rate × equivalent hours × (1 + burden) + fixed costs. Labor cost % = that cost ÷ weekly net sales × 100.

A worked example

Fictional example, step by step: $15,000 of weekly sales × 30% = a $4,500 labor budget. Subtract $200 of fixed costs: $4,300. Divide by 1.15 to strip out the 15% employer-cost allowance: $3,739.13 is available for wages. Overtime hours cost 1.5× a regular hour, so 160 regular hours + 1.5 × 10 overtime hours = 175 straight-time-equivalent hours. $3,739.13 ÷ 175 = about $21.37 an hour. Checking the other way: a $22 average × 175 hours = $3,850 of wages, × 1.15 = $4,427.50, + $200 = $4,627.50 a week, which is 30.85% of sales and would need $15,425 in weekly sales to stay at 30%.

How to use the result

Verify the legal floor first, for this job and this date

A national average never overrides a higher local requirement. New York and New Jersey publish their own tables; tipped-work rules are conditional, not a discount. Enter the figure you verified in the minimum field so the tool can warn you.

Hours come from the schedule, employee by employee

Two people at 30 hours do not create overtime; one person at 45 does. Build the week in the shift planner, then carry its regular and overtime totals here. Do not trim compensable time to make the number work.

Affordable is not the same as appropriate

If the budget supports $21 and comparable local jobs pay $23, the answer is not to underpay. Change prices, coverage, complexity or the concept. Record what you found with the pay research template so the decision has evidence behind it.

Questions owners ask

Can I use this to calculate my labor cost percentage?

Yes, for one week of hourly staff. In the proposed-rate field, enter the average base rate: add each hourly employee's base rate × hours worked, overtime hours included at base rate, then divide by total hourly hours. If salaried managers belong in your percentage, put their weekly pay and its employer costs in fixed labor costs and leave their hours out. "Labor as a share of sales at the proposed rate" is then your total labor cost %, employer costs included: $4,627.50 ÷ $15,000 = 30.85% in the example, shown as 30.9%. If people working overtime earn more or less than the average, use the shift planner instead. Tipped roles need a payroll calculation.

What if the tool says the budget does not cover my fixed costs?

Then your target, at these sales, cannot pay even the fixed labor costs before any hourly wages, so the tool shows no percentage. That is a planning result. Change the target only if your plan really allows more labor; raising it just to get a figure would show a budget the plan cannot support. To measure what a week actually cost, divide its all-in labor cost (wages including overtime pay, employer costs and benefits) by net sales for the same dates, or enter each employee's shifts and verified rate in the shift planner, which uses no target.

Where does the employer burden percentage come from?

From your own estimate. IRS Publication 15 gives the 2026 employer social security and Medicare rates and the FUTA rate; state unemployment insurance, workers' compensation and benefits vary. Ask your payroll provider or accountant for a figure for your state and use that.

Can I use this for tipped employees?

Not directly. Tip credits, the cash wage and the regular-rate rules for overtime need a payroll calculation that follows the applicable state rules. Use the tool for base-wage planning and confirm tipped-role pay separately.

Why does the tool not tell me what cooks are paid?

Because a national median (the BLS reports $17.62 an hour for cooks nationally in May 2025) is broad historical context, not a local offer for your job. Build a dated sample of comparable local postings instead.

Keep working on the decision

Sources and scope

Planning estimates based on your inputs. Check the assumptions against your actual quotes, recipes and operating records. Not legal, tax or accounting advice.

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