Employee Costs

Employee Costs

Employee Costs Jonathan Poland

Employee costs refer to all of the expenses that are incurred when hiring and employing an individual. These costs go beyond just the employee’s salary and may include benefits such as healthcare, retirement plans, and other perks. In some cases, the total cost of employing an individual may be significantly higher than their salary, especially in certain industries or professions, or in countries with higher labor costs. Therefore, it is important for organizations to carefully consider all of the costs associated with hiring and employing employees when making staffing decisions. The following are common types of employee cost.

Recruiting Costs

The direct costs of recruiting an employee.

Human Resources

The cost of human resources overhead divided by the number of employees. This captures cost related to compliance and administration of employment.

Salary

Annual salary or hourly wage.

Payroll Taxes

Payroll taxes and social security payments that are paid by the employer based on the employee’s salary such as pension, unemployment insurance, medical insurance, disability insurance, maternity and child benefits. These differ greatly by nation, state or province.

Benefits

Benefits that are paid by the employer such as medical insurance, disability insurance, dental insurance, life insurance and pension.

Incentives

Incentives such as profit sharing plans, bonuses and stock options.

Paid Leave

Paid time off including public holidays, vacation, sick days, personal days, bereavement leave, maternity and paternity leave.

Training & Development

Training and development programs including the cost of onboarding.

Office Space

Costs related to office space per employee such as rent and facility management costs.

Consumables

Office consumables such as coffee, food and stationery.

Insurance

Insurance attributable to employees such as employee liability insurance.

Equipment

Furniture, fixtures and equipment such as computers and mobile phones.

Learn More…

Product Development Jonathan Poland

Product Development

Product development is the process of designing, creating, and launching new products.…

Analysis Paralysis Jonathan Poland

Analysis Paralysis

Analysis paralysis, also known as “paralysis by analysis,” is a phenomenon that…

Scientific Control Jonathan Poland

Scientific Control

Scientific control is a fundamental principle of experimental research, which is used…

Economic Security Jonathan Poland

Economic Security

Economic security refers to the ability of an individual or a household…

Data Breach Jonathan Poland

Data Breach

A data breach is a security incident in which sensitive, protected, or…

What is Cultural Fit? Jonathan Poland

What is Cultural Fit?

Culture fit refers to the compatibility of a candidate’s attitudes and experiences…

Contingency Planning Jonathan Poland

Contingency Planning

Contingency planning is a risk management strategy that involves developing alternative plans…

Keep It Super Simple Jonathan Poland

Keep It Super Simple

Keep it Super Simple or Keep it Simple Stupid. The KISS principle…

Data Security Jonathan Poland

Data Security

Data security is the practice of protecting data from unauthorized access, use,…

Jonathan Poland © 2023

Search the Database

Over 1,000 posts on topics ranging from strategy to operations, innovation to finance, technology to risk and much more…

Calculated Risk Jonathan Poland

Calculated Risk

Calculated risk is an essential concept in the field of risk management.…

Business Process Improvement Jonathan Poland

Business Process Improvement

Business process improvement involves identifying and implementing changes to processes in order…

Brand Image Jonathan Poland

Brand Image

Brand image is the overall perception that consumers and the public have…

Needs Analysis Jonathan Poland

Needs Analysis

Needs analysis is the process of identifying the valuable requirements for a…

Puffery Jonathan Poland

Puffery

Puffery refers to exaggerated or overstated claims in marketing communications. It is…

Types of Fail Safe Jonathan Poland

Types of Fail Safe

A fail-safe is a mechanism or system that is designed to prevent…

Cultural Norms Jonathan Poland

Cultural Norms

A cultural norm is a shared belief or behavior that is considered…

Risk-Reward Ratio Jonathan Poland

Risk-Reward Ratio

The risk-reward ratio is a measure that compares the potential for losses…

Data Security Jonathan Poland

Data Security

Data security is the practice of protecting data from unauthorized access, use,…