ToolsHubPro
Your hourly rate isn't your real labour cost. Add super (11.5%), workers comp, annual leave, sick pay, tool allowance, and vehicle costs — and that "$50/hr labourer" costs closer to $78/hr. Here's the complete calculation.
The Real Cost of a Worker
Most tradies think: "I pay my worker $35/hr, I'll charge $55/hr and make $20/hr profit." Wrong. The real cost is much higher.
Base Wage: $35.00/hr\nSuper (11.5%): +$4.03/hr\nWorkers Comp: +$1.75/hr (varies by trade)\nAnnual Leave: +$2.69/hr (4 wks ÷ 48 wks)\nSick Leave: +$0.67/hr (10 days ÷ 48 wks)\nPublic Holidays: +$0.77/hr (11 days ÷ 48 wks)\nTool Allowance: +$1.50/hr\nVehicle/Travel: +$3.00/hr\n─────────────────────────\nTRUE COST: $49.41/hr
Worker Classification: Employee vs Subcontractor
The ATO is cracking down on "sham contracting" — calling someone a subcontractor when they're really an employee.
- Employee: You pay super, workers comp, leave, payroll tax. You control their hours and tools.
- Subcontractor: Has their own ABN, tools, insurance. They quote per job, not per hour. You can't control their hours.
⚠️ ATO Warning
If you pay someone hourly and provide their tools, they're probably an employee — even if they have an ABN. The ATO uses a "multi-factor test" and the penalties are severe.
Productivity Factors — Why 8 Hours ≠ 8 Billable Hours
No worker is productive every minute. Real productivity on-site:
- Set-up & pack-up: 30 min/day
- Tool maintenance & sharpening: 15 min/day
- Material handling & moving: 45 min/day
- Measurements & layout: 30 min/day
- Breaks & fatigue (beyond official breaks): 20 min/day
- Billable hours from 8hr day: ~5.5 hrs
Labour Cost by Trade (Melbourne, 2026)
- Carpenter: $75–$110/hr (employee ~$50/hr)
- Plumber: $90–$140/hr (employee ~$55/hr)
- Electrician: $90–$130/hr (employee ~$55/hr)
- Bricklayer: $70–$100/hr (employee ~$48/hr)
- Painter: $55–$80/hr (employee ~$40/hr)
- General Labourer: $50–$70/hr (employee ~$38/hr)
Use our Contractor Rate Calculator to find your break-even rate and recommended charge-out rate.
Calculate Your Real Labour Rate
Try Calculator →