Labour cost calculator for pubs, restaurants and cafés
Labour cost percentage is your total staff cost (wages plus employer costs such as National Insurance, pension and holiday) divided by your sales excluding VAT, times 100. Put your figures in below to work it out for a week or a month.
Labour is usually the biggest cost you can actually control week to week. This calculator gives you the number in seconds. Everything stays in your browser: nothing is sent or saved.
Enter your wages and sales to see your labour cost percentage.
How the calculation works
Labour cost % = (gross wages + employer on-costs) ÷ net sales × 100
- Gross wages: what you paid staff for the period before deductions, including overtime and any salaried managers you count as labour.
- Employer on-costs: the extra you pay on top of wages. The main ones are employer National Insurance, employer pension contributions under auto-enrolment, and holiday pay if you don't already include it in wages. The 12% default is only a placeholder: your accountant or payroll provider can tell you your real figure, which depends on how many staff earn above the National Insurance threshold and your pension scheme.
- Net sales: takings for the same period with VAT taken off.
Use the same period for both. A week is ideal for rota decisions; a month smooths out busy and quiet weeks.
A worked example
A 60-cover gastropub takes £16,800 including VAT in a week, so roughly £14,000 net. The wage bill is £4,200 and on-costs add about 12%, making £4,704. Labour cost is £4,704 ÷ £14,000 = 33.6%.
If the owner's target is 30%, the week was about £500 over. That's not a reason to cut a chef on a Saturday: it's a prompt to look at where the hours went. Often it's two people closing on a quiet Tuesday, or a 10am start on a day the kitchen doesn't open till noon.
Get the number before the week happens, not after
Most operators find out their labour cost when payroll runs, which is too late to change anything. The fix is to see the cost while you're building the rota:
- Forecast sales for each day from last year and any events (a match, a bank holiday, a private party).
- Build the rota against that forecast.
- Check the rota's cost against your target percentage before you publish it.
- After the week, compare actual sales and hours with the plan and adjust next week.
ShiftComplete shows labour cost as you build the rota, builds a fair draft from your team's availability in seconds, and lets you add events so busy days are staffed up and quiet ones aren't. Read more in our guide to labour cost percentage in hospitality and how to write a pub rota.
Frequently asked questions
Should I use sales before or after VAT?
Use net sales, after VAT has been taken off. VAT isn't your money, so including it makes your labour cost look lower than it really is. If your till reports gross sales, divide by 1.2 for standard-rated sales as a rough guide.
What counts as labour cost?
Everything it costs you to have people on shift: gross wages and salaries, overtime, employer National Insurance, employer pension contributions, and the cost of holiday pay. Some operators also add staff food and agency staff. Be consistent so week-on-week comparisons are fair.
Should managers' salaries be included?
Most operators include them, because a salaried manager on the floor is doing work you'd otherwise rota someone for. Whatever you decide, do the same every week so the trend is meaningful.
How do I bring labour cost down without cutting service?
Rota to your trading pattern rather than habit: look at which hours are quiet, stagger start times, use split shifts where your team is happy to, and check the rota against forecast sales before you publish it. Seeing the cost while you build the rota helps most.
Sources
- Rates and thresholds for employers 2026 to 2027 (GOV.UK)
- Workplace pensions: what your employer can and cannot do (GOV.UK)
Checked 24 October 2026. This guide is general information, not legal advice.