There are many various different ways to calculate the true costs of the hourly costs. Here is the approach that I usually like to illustrate based on $25 @ 40 hours per week

Annual Salary ($25 x 40 x 52) $52,000
Kiwisaver 3% $1,560
ACC (depending on industry) say 2% $1,040
Other staff costs (these are estimates and need to be based on your business)
– Cellphone $1,200
– Training courses $1,000
– Uniform $500
– Other staff benefits $500

TOTAL SALARY + BENEFITS $57,800

Then divided that by the number of working weeks which is 52 – 4 (annual leave) – 2.2 (stats) – 1 (sick) – 1 (other leave) – 1 (estimate annual training) = 42.8 weeks

So costs for an average working week is $1,350. Of 40 hours per week, not all of them are always productive as there are internal admin, non chargeable time, travel time etc. So assume an employee is 80% (obviously you should use the % based on the past experience with your staff) productive per working week, then he/she will be productive for 32 hours per week.

So the true hourly costs for each productive hour is $1350/32 = $42.2.