Labour Percentage Calculator
What labour actually costs once NIC, pension and holiday pay are in the number, not just the wage bill.
Enter rostered hours and average pay rate by department. On-costs are added on top, that is the difference between the wage bill and what labour really costs you.
Excluding VAT. Using gross sales is the fastest way to make labour look better than it is.
Managers, head chef, anyone not paid by the hour. Gross salary before on-costs.
Secondary Class 1 on pay above the threshold. An estimate at pot level.
Auto-enrolment minimum is 3% of qualifying earnings.
12.07% is the standard accrual for 5.6 weeks' statutory leave. Leave at zero if holiday is already in the hours above.
Real labour cost that never appears on the rota, and the most commonly forgotten line.
Food-led sites often run 28–33%, wet-led lower.
Optional. Gives you labour cost per cover.
| Department | Hours | Avg rate £/hr | Wage cost | Remove |
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How the true cost is worked out
- Wage cost = sum of (hours × rate) by department, plus salaried pay
- On-costs = wage cost × (employer NIC % + pension % + holiday accrual %)
- Fully loaded labour = wage cost + on-costs + agency spend
- Labour % = fully loaded labour ÷ net sales
Sales per labour hour is separate, and deliberately excludes salaried and agency hours you did not enter: SPLH = net sales ÷ rostered hours.
A worked example
The seeded rota: 320 kitchen hours at £14.50, 280 front of house at £12.60, 120 bar at £12.80, 90 KPs at £12.71, with £9,800 salaried, £1,400 agency and £88,000 of net sales.
- Hourly wages = £4,640 + £3,528 + £1,536 + £1,143.90 = £10,847.90
- Plus salaried = £20,647.90 of wage cost
- On-costs at 30.07% = £6,208.82
- Fully loaded, with agency = £28,256.72
- Labour percentage = 32.1%, against 23.5% if you only counted wages
Nearly nine points between the two numbers, on the same site, in the same week. That is not a rounding difference. It is the whole argument for measuring it properly, and it is what Why Your Labour Percentage Is Lying to You is about.
Common questions
Why is my labour percentage higher here than in my weekly report?
Because most weekly reports use the wage bill, and the wage bill is not the cost. Employer NIC, pension contributions and holiday accrual add roughly a fifth on top before you count agency spend.
Both numbers are useful, but only one of them matches your P&L. If the rota says 27% and the accounts say 33%, nothing is wrong. You are looking at two different measurements and calling them the same thing.
Should tronc be in the labour percentage?
No. Tips allocated through a properly run tronc are not your cost. They belong to the workers, they carry no employer NIC, and putting them in labour overstates the cost of running the site.
Where they matter is retention: a site with a strong tronc can often hold good people at a lower base rate. That shows up as a lower labour percentage, which is a real advantage rather than an accounting trick.
What is 12.07% and do I need it?
It is the standard accrual for 5.6 weeks of statutory holiday, expressed as a percentage of hours worked: 5.6 ÷ (52 − 5.6) = 12.07%. If your hourly staff accrue holiday they take later, that cost belongs in the period they earned it, not the week they take it.
Set it to zero only if the hours you entered already include holiday taken. Leaving it out entirely is how a site discovers an unbudgeted liability every August.
Why sales per labour hour as well as a percentage?
Because a percentage moves when you change prices, and productivity does not. Put prices up 5% and your labour percentage improves without a single thing changing in the kitchen. Sales per labour hour tells you whether the operation actually got better.
Watch both: the percentage for affordability, SPLH for productivity. When they disagree, SPLH is usually telling the truth.
Is agency spend really labour?
Yes, and leaving it out is the most common way a labour percentage is understated. It does not come through payroll, so it is easy to miss, but it is money spent getting shifts covered, and a site leaning on agency to hit its rota is more expensive than one that does not.
What labour percentage should I be running?
Food-led sites commonly land between 28% and 33% fully loaded; wet-led is usually lower, quick service can be higher. Format, location and wage rates move this a long way, so a benchmark is a conversation-starter rather than a verdict.
The more useful comparison is against yourself: same site, same period last year, same measurement basis.
Rates and thresholds shown are for 2026/27, correct as at 6 April 2026 for England. They are editable above, confirm the current figures before relying on any output.
An estimate to help you think, not advice on your own business. The numbers depend on assumptions only you can confirm, talk to us before you act on them.
Labour reported the same way every week
We build rota-to-payroll reporting that shows fully loaded labour by site and department, so the weekly number and the P&L number finally agree.