To cost a tradie employee, add annual pay for all paid hours, super, expected loadings, workers compensation, payroll tax if it applies, and tools and training, then divide by the hours you can bill. Business.gov.au says super is paid on top of wages and that payroll tax thresholds and rates differ by state and territory. Look up current rates yourself, because this guide uses placeholders and a made-up example.[1]
Costs to put on the worksheet
Business.gov.au points to award pay and conditions, super, payroll tax and fringe benefits tax where they apply, and workers compensation insurance. Most employees are covered by an award, and the Fair Work Pay and Conditions Tool can work out pay under it.
Two cautions. Super is paid in addition to wages and cannot be deducted from the employee's pay. PAYG withholding is tax taken out of gross wages and sent to the ATO, so it is not an extra cost to add on top of gross pay.
Sources[1]
Annual worksheet
Fill in each line with current figures. The structure is our recommendation, not a mandated form.
| Line | Item | How to fill it in |
|---|---|---|
| A | Annual gross pay for all paid hours, including paid leave | From the award or contract. Do not add leave again below |
| B | Loadings, penalties and overtime you expect to pay | Estimate from the roster. Leave out if already in A |
| C | Super | [current rate] x qualifying earnings. Confirm what counts with your accountant |
| D | Workers compensation | Premium from your insurer or scheme |
| E | Payroll tax | Only if total business wages exceed your state or territory threshold |
| F | Tools, vehicle, PPE, licences and training | Annual estimate |
| G | Total annual cost | A + B + C + D + E + F |
Sources[1]
Turn the total into a cost per billable hour
Paid hours are not all billable. Start with paid hours, then take off paid leave, training, quoting, admin, unbilled travel and callbacks to reach billable hours. This is where non-billable time shows up.
Hypothetical example only: if line G is $100,000 and the employee has 1,400 billable hours, the cost is $71.43 per billable hour ($100,000 divided by 1,400). These are made-up round figures, not an average and not a charge-out rate. Overheads and margin are added separately.
Sources[1]
Common questions
- What are the typical costs of hiring an employee in Australia?
- This guide does not give a typical figure, because cost depends on the award, hours, state or territory, insurance and role. Business.gov.au lists the areas to check: award pay, super, payroll tax, fringe benefits tax where relevant and workers compensation. Use the worksheet with current figures.[1]
- How much should I charge for an employee?
- Cost per billable hour is only your cost floor. Add overheads and margin to reach a charge-out rate, and see the charge-out rate guide for that step.[1]
Official sources
Checked 16 October 2026. Rules can change; use these sources to check the requirements for your job.
Related guides
- How do I calculate my trade business charge-out rate?
- How do I cost a trade job before quoting?
- How do trade businesses distinguish employees and contractors?
Job workflows for builders.
Put it to work on the next job
Once you know your cost per billable hour, Leadhand's pricebook holds your labour rates so quotes and GST invoices use the same figures.
See Leadhand quoting and pricebook