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True cost of an employee
calculator (Australia)

A salary is never the real cost. See the fully loaded figure once super, payroll tax, and on-costs land.

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Fully loaded annual cost
 
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What is the true cost of an employee in Australia?

Beyond base salary, employers pay superannuation (12% from 1 July 2025), state payroll tax, workers' compensation, and leave entitlements. These mandatory on-costs typically add around 25% to 40% on top of salary, and recruitment, training, and equipment push the total higher again.

How we calculated this

We start with the base salary and add the on-costs every Australian employer carries: superannuation guarantee at 12%, payroll tax at your state's headline rate, an allowance for workers' compensation and a provision for paid leave. The sum is the fully loaded annual cost; dividing it by base gives the multiple, and multiplying by headcount gives the team figure. The number stands for the cash a role commits you to over a year, before recruitment, equipment or overheads are added. The working, the assumptions and the sources are below.

New to the term? Read the plain-English definition of the superannuation guarantee in the HR Glossary.

Your working
Assumptions
  • Superannuation at 12% of the base entered, the super guarantee rate on ordinary time earnings since 1 July 2025 and the final legislated step. Bonuses, overtime, allowances and the maximum contribution base are ignored, so for a very high earner the super line is slightly overstated.
  • Payroll tax uses your state's headline rate on the whole salary. It only applies once your total Australian wages pass the state threshold, and Queensland, South Australia, Tasmania and the ACT tier the rate by payroll size, so a small employer under threshold pays none and this line overstates their cost.
  • Workers' compensation is set at 1.5% of salary. Safe Work Australia's national standardised average premium was 1.34% of payroll in 2021-22, but industry rates run from well under 1% for office work to several times that in construction and manufacturing. Use your own premium if you know it.
  • Leave and other on-costs at 8.5% stand in for the annual, personal and long service leave that accrue under the National Employment Standards, and the cost of covering the absence. It is a provision rather than a second payment: salary already pays for leave taken. It shows up when someone leaves with a balance or when you backfill.
  • Recruitment, onboarding, equipment, software and office space are left out. That is why mandatory on-costs land at roughly 25 to 40% over base while all-in figures run higher again.
Sources

What to do about it

The gap between the salary and the loaded figure is where people budgets go wrong: headcount plans built on base salary run 25 to 40% over before anyone starts. These steps are for whoever builds the people budget or signs off a new role, whether that is HR or the manager asking for the headcount.

1

Re-cost the headcount plan on the loaded figure, not the base

Run every open and planned role through this calculator with the right state and put the multiple next to the salary column. That one change usually explains why the people budget was under-forecast, and the loaded number is the one that belongs in the business case rather than the number on the ad.

2

Check whether payroll tax applies to you at all

It starts only once your total Australian wages cross your state's threshold, and several states tier the rate. For a small employer it can be zero; for a large employer in a tiered state it can be higher than the headline. Confirm the threshold with your state revenue office before you carry a rate across the whole payroll.

3

Swap in your real premium and your real leave balances

The defaults are national estimates. Your workers' compensation premium is on your policy and your leave liability is on your balance sheet. Put them in and the loaded figure stops being an average and becomes yours.

4

Write down what the loaded cost is buying

A role that costs roughly 1.3 times its salary has to return more than that. Name what the role is expected to deliver in year one and who will judge whether it did. Most roles get costed carefully and evaluated never.

5
Where a tool helps

Treat the loaded figure as the price of getting the hire wrong

Every month a poor fit stays, you carry the loaded cost rather than the salary, and you carry it again while you rehire. The most reliable saving in this calculator is fewer hires you regret, and that sits with selection and engagement rather than with payroll.

Step 5 is the number
payroll cannot see.

Compono is a talent intelligence platform: an applicant tracking system (ATS) and an employee engagement platform that share the same people data. Your payroll system produces the figure above to the cent. What it cannot tell you is whether the person on that salary is the right one, or whether they are about to leave and cost you the loaded figure twice.

Compono reads fit before the offer, so the loaded cost goes to someone who suits the role and the team, and it reads engagement and culture while they are on the payroll, so the exit you could have prevented is flagged before the resignation. Step 5 is where the money in this calculator is actually saved. Compono is built for it.

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Compono
$34M
saved by VicRoads over two years

Common questions

How do you calculate the fully loaded cost of an employee?

Take the base salary and add: superannuation at 12%, payroll tax at your state's rate, a workers' compensation premium for your industry, the value of annual, sick, and long service leave, and overheads such as recruitment, onboarding, software, and equipment.

How much is superannuation in 2026?

The superannuation guarantee rate is 12% of ordinary time earnings, which has applied since 1 July 2025 and is the final step in the legislated phase-up.

Does payroll tax change the cost of an employee?

Yes. Payroll tax is a state-based tax that applies once your total wages cross a threshold, with rates of roughly 4.75% to 6.85% depending on the state. It adds directly to the cost of each employee above that threshold.

This page is general information, not legal advice. We check figures annually and update them on a best-efforts basis, but employment rules change and we cannot promise everything here is current or complete. Before you act on it, confirm the detail with the Fair Work Ombudsman or your own adviser. Last reviewed July 2026.

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The superannuation guarantee

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