Project labour cost calculator: staff hours against the quote
A project's labour cost is the hours each role spends on it times what an hour of that role costs you, including employer KiwiSaver of at least 3.5% and your other on-costs. Type the hours, the costs and the quote. The calculator shows the labour cost, the share of the quote used, the margin left, and warns once costs pass 80% of the quote.
Worked out for the example. Change the boxes to make it yours.
Nearly used: the costs have reached 80% of the quote (83.9%), with $2,972 left.
| Senior architect: 46 hours at $78.00 | $3,588 |
|---|---|
| Architect: 120 hours at $58.00 | $6,960 |
| Graduate: 90 hours at $42.00 | $3,780 |
| Labour cost | $14,328 |
| Average cost an hour | $55.97 |
| Other project costs | $1,200 |
| All costs | $15,528 |
| Quote or budget, before GST | $18,500 |
| Share of the quote used | 83.9%, nearly used |
| Margin left | $2,972 (16.1% of the quote) |
| Hours left at the average cost an hour | 53.1 hours |
- The costs an hour are your loaded figures, so nothing is added to them.
- Compare the quote before GST: if you are registered for GST, the GST you charge is paid to Inland Revenue.
Team timesheets shows the hours staff choose to share, by person, project and task, and who has not logged this week, with a CSV ready for payroll, optional approvals and your own billable rates. It never reads the pay or rates in anyone's own account, and has no rosters.
See Team timesheetsHow the cost is worked out
Each role's hours are multiplied by its cost an hour, and the roles are added up for the labour cost. Other project costs are added to that, and the total is compared with the quote or budget before GST: if you are registered for GST, the GST you charge is paid to Inland Revenue, so it is not yours to spend on the work. What is left is the margin. The hours left are the margin divided by the average cost of an hour on the project so far, which is how much more time the quote can carry before it makes a loss.
What an hour of staff time really costs
An hour of someone's pay is not what the hour costs you. An employer must contribute at least 3.5% of gross pay to the KiwiSaver of an employee aged 16 to 64 who contributes (3% if matching an employee's temporary rate reduction), rising to 4% from 1 April 2028, and ESCT comes out of that contribution rather than on top of it. ACC charges a work levy that depends on your industry. Annual holidays, public holidays and sick leave are paid but not worked, so they spread across the hours that are. Choosing pay rates only adds the 3.5% and nothing else, which understates the cost: our cost of an employee calculator gives a loaded cost for each hour worked. Overheads such as premises and software come on top again; our article on setting a charge-out rate for staff covers them.
The 80% line
The calculator flags a project once its costs pass 80% of the quote, and marks it over budget at 100%. It is the same line Team timesheets uses for a project's budget in hours, which stands out on the Team page once 80% of the hours are used, with a notice to the Owner and Admins at 80% and at 100%. At 80% there is usually still time to talk to the client about scope or a variation. At 100% the rest of the work is at your cost.
Hours you can stand behind
The cost is only as good as the hours. A record made on the day, by person, project and task, is more reliable than a total remembered at the end of the job. Section 130 of the Employment Relations Act 2000 already asks you to keep the hours each employee works each day in each pay period, so the same record can cost your projects. Every hour must also be paid at least the minimum wage, $23.95 an hour for adults from 1 April 2026, including for salaried staff on a long project.
Questions
How do you calculate labour cost for a project?
Multiply the hours each person or role spends on the project by what an hour of their time costs you, then add the roles together. Use a loaded cost an hour, which includes employer KiwiSaver, ACC levies and paid leave, not just the pay rate.
What is a loaded labour rate?
The full cost to you of each hour someone actually works: their pay, employer KiwiSaver of at least 3.5%, ACC levies and anything else you pay, spread over the hours left after annual leave, public holidays and sick days. It is always higher than the hourly pay rate.
Should I compare costs with the quote including GST?
No. If you are registered for GST, the GST in the price is paid to Inland Revenue, so compare your costs with the quote before GST.
What does 80% of budget mean?
Your costs have used four fifths of the quote. It is a common point to check the work left against the money left, and the point at which Team timesheets highlights a project's budget in hours.
Can I get the hours for each project from my team?
Team timesheets at jobtracker.co.nz shows the hours staff choose to share, by person, project and task, for any period, with a CSV ready for payroll. Give each person a private cost rate, such as the loaded cost from this calculator, and the Owner and Admins see each project's cost, and with your billable rates its value and margin. Nothing is read from the pay or rates in anyone's own account.
Sources
- Inland Revenue: employer contributions to KiwiSaver schemes and complying funds.
- Inland Revenue: KiwiSaver changes.
- Inland Revenue: employer superannuation contribution tax (ESCT).
- business.govt.nz: ACC levies.
- Inland Revenue: charging GST.
- Employment Relations Act 2000, section 130: wages and time record.
- Minimum Wage Order 2026 (SL 2026/16).
More free tools: see all the calculators.