Free RevOps Tool
Employee Cost Calculator (True Cost and Revenue Justification)
What the hire really costs, and the revenue they need to produce for the P&L to hold. Mode A stacks every employer cost on top of the salary; mode B turns the loaded number into the revenue bar the role has to clear.
The Offer Letter Is the Down Payment
Statutory rates verified against 2026 sources; anything we cannot verify, you enter, and the tool never guesses.
1. The hire
Enter a salary above zero.
SUTA figures come from your state workforce agency. FUTA is 0.6% effective in most states; set it to match your state.
From your policy declarations page or state rating bureau. Leave blank to exclude.
Average annual employer share of the premium: $7,833 single, $20,143 family. Edit to your actual.
Software, equipment, space, T&E.
2. The P&L bar it must clear
Gross margin must be higher than your EBITDA target for this math to work.
This formula assumes the role sits in operating expenses. If the role is billable delivery labor already counted inside cost of goods sold, this math would double count it.
Fully loaded cost
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The hire costs more than the offer letter says.
- Base salary
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- Employer FICA (6.2% SS + 1.45% Medicare)
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- FUTA (federal unemployment)
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- SUTA (state unemployment)
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- Other state employer taxes
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- Workers comp
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- Health insurance (employer share)
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- 401(k) match
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- Other overhead
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- Fully loaded cost
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- Burden multiple
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New Jersey figures: 2.8% combined SUTA new-employer rate and 0.50% employer TDI on the $44,800 wage base, 2026. FICA wage base $184,500, 2026. The 0.9% Additional Medicare Tax is employee-paid and correctly excluded.
- Fully loaded cost (from mode A)
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- Required annual revenue
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- Monthly revenue equivalent
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- Revenue-to-salary multiple
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Why: revenue must satisfy revenue times margin minus loaded cost greater than or equal to revenue times EBITDA target.
How This Calculator Works
A $75,000 salary is not a $75,000 cost. The employer side of FICA adds 6.2% Social Security (up to the $184,500 wage base for 2026) plus 1.45% Medicare on every dollar. Federal unemployment adds an effective 0.6% on the first $7,000 in most states. State unemployment applies your state’s new-employer rate to its wage base, New Jersey runs a combined 2.8% on the first $44,800 for 2026, and a handful of states add employer-paid items like New Jersey’s 0.50% temporary disability insurance. Workers comp, health insurance, retirement match, and plain overhead stack on top of all of it.
Mode B answers the harder question: what does this hire have to produce? The logic is one inequality. Revenue times gross margin has to cover the loaded cost and still leave your target EBITDA, so required revenue equals loaded cost divided by margin minus EBITDA target. One honest caveat, printed in the tool: this assumes the role sits in operating expenses. Billable delivery roles already counted inside cost of goods sold would be double counted by this formula.
The formula
| What | The math |
|---|---|
| Employer FICA | 6.2% × min(salary, $184,500) + 1.45% × salary |
| FUTA | 0.6% effective × min(salary, $7,000); CA 1.8% and USVI 5.1% for tax year 2025 |
| SUTA | state new-employer rate × min(salary, state wage base) |
| Workers comp | salary ÷ 100 × rate per $100 for the risk class |
| Fully loaded cost | salary + FICA + FUTA + SUTA + other state taxes + workers comp + insurance + 401(k) + overhead |
| Burden multiple | loaded cost ÷ salary |
| Required revenue (mode B) | loaded cost ÷ (gross margin % − target EBITDA %) |
Keep the Math Going
The rest of the free RevOps toolkit, and the team that runs this math for clients.
FTE Calculator
Convert part-time hours into full-time equivalents first.
PPC Budget Calculator
The same reverse math, applied to pipeline instead of payroll.
People & Culture Advisory
Hiring plans built on capacity math, not vibes.
Frequently Asked Questions
How much does an employee really cost beyond salary?
Add employer FICA (6.2% Social Security up to the annual wage base plus 1.45% Medicare), federal and state unemployment taxes, workers compensation, any state-specific employer taxes, benefits, and overhead. The total is the fully loaded cost, and dividing it by salary gives the burden multiple, commonly well above 1.2x before benefits are even generous.
What is labor burden?
Labor burden is everything an employer pays for an employee beyond gross wages: payroll taxes, unemployment insurance, workers comp, benefits, and allocated overhead. Burden rate is that total expressed as a percentage of salary. This calculator itemizes each component instead of applying a blanket percentage.
What payroll taxes does an employer pay?
The employer side of FICA: 6.2% Social Security on wages up to the annual base ($184,500 for 2026) and 1.45% Medicare on all wages. Federal unemployment (FUTA) at an effective 0.6% on the first $7,000 in most states. State unemployment (SUTA) at your state’s rate on its wage base. Some states add employer-paid programs, like New Jersey’s temporary disability insurance. The 0.9% Additional Medicare Tax is withheld from employees and is not an employer cost.
How much revenue should an employee generate?
Enough that revenue times your gross margin covers their fully loaded cost and still leaves your target EBITDA: required revenue equals loaded cost divided by (margin minus EBITDA target). At a 50% margin and a 15% EBITDA target, a $98,000 loaded cost needs about $280,000 in annual revenue. The multiple-of-salary bands in this tool are Strativera rules of thumb, not published benchmarks.
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