Labour hire charge rate calculator
Use this labour hire charge rate calculator to see how an hourly rate is built, from the worker's pay through super, payroll tax and workers compensation to the agency margin. It helps host employers compare labour hire quotes line by line and spot when a rate is too low to cover the legal minimums.
Updated 12 November 2026 · Uses 2026-27 figures
Build a labour hire charge rate
Enter the worker's base rate, state, workers comp rate and margin.
General information only, not financial, tax or legal advice. Results are estimates based on 2026-27 figures and the assumptions shown. Check your award, agreement or a qualified adviser for your situation.
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Get a quote Call 0477 567 567How to use the labour hire charge rate calculator
- Enter the worker's base hourly rate. Use the award or agreement rate for the role, before any casual loading.
- Choose whether the worker is casual. The calculator adds the 25% casual loading for casual employees.
- Pick the state where the work is done so the right payroll tax rate is used, and enter the workers comp premium as a percentage of wages.
- Enter the agency margin as a percentage of the charge rate. The result shows the hourly charge rate before GST and the cost of a 38-hour week.
How a labour hire charge rate is built
A labour hire agency employs the worker, so it pays the wages and every cost that comes with employing someone. The charge rate the host business pays has to cover all of those costs first, and the margin sits on top. In 2026-27 the main layers are:
| Layer | What it covers | 2026-27 basis |
|---|---|---|
| Base pay | The award, agreement or agreed hourly rate | At least the award minimum for the role |
| Casual loading | Paid instead of leave and notice for casual employees | 25% of the base rate |
| Superannuation | Super guarantee on ordinary time earnings | 12% |
| Payroll tax | State tax on wages and super above the threshold | 4% to 6.75% depending on the state |
| Workers compensation | The agency's workers comp premium | A percentage of wages set by the insurer |
| Margin | Recruitment, rostering, payroll, insurance, compliance and profit | Set by each agency |
The calculator adds super, payroll tax and workers comp to the pay rate to get the cost per hour, then divides by (1 minus the margin) so the margin is a true percentage of the charge rate. GST of 10% is added to the invoice on top.
Worked example
A casual worker on a base rate of $27.00 an hour in NSW, with a 3% workers comp premium and a 15% margin.
Pay rate with 25% casual loading: $33.75. Super at 12%: $4.05. NSW payroll tax at 5.45% of pay and super: $2.06. Workers comp at 3%: $1.01. That makes the cost per hour $40.87.
With a 15% margin the charge rate is $48.09 an hour plus GST, and the agency margin is $7.21 an hour. A 38-hour week costs $1,827 before GST.
These figures are an illustration of the method, not TQN Personnel's prices. Real quotes depend on the role, award level, shifts, location and volume.
What is a fair labour hire margin?
There is no set margin in Australia. Margins vary with the type of work, how hard the role is to fill, the length of the booking and how much the agency does for you. Higher-risk work such as construction or traffic control usually carries a higher workers comp premium, so the cost base is higher before any margin is added.
When you compare quotes, ask each agency for the same build-up. If one rate is well below the others, check that it still covers the award rate with casual loading, 12% super, payroll tax and workers comp. A rate that does not cover those costs is a warning sign of underpayment or sham contracting, and host businesses can be exposed when a labour hire provider does not meet its obligations.
Margin or markup?
Some agencies quote a markup on cost rather than a margin on price. A 15% margin is the same as roughly a 17.6% markup. Use the margin and markup calculator to convert between the two.
What the charge rate does not include
The calculator prices ordinary weekday hours. Several costs are charged on top at their own rates:
- Penalty rates for evenings, nights, weekends and public holidays, which lift the pay rate and therefore every on-cost.
- Overtime, usually 150% for the first two or three hours and 200% after that.
- Allowances such as tool, travel, meal, first aid or site allowances under the award.
- GST of 10% on the invoice, which a GST-registered host can usually claim back.
Payroll tax only applies once an employer's total wages pass the state threshold. Most labour hire agencies are above it, so it is normally part of the rate. Use the payroll tax calculator to see the rules in each state.
When labour hire makes sense
Labour hire suits seasonal peaks, project work, cover for leave and roles you need filled quickly. You pay for the hours worked, and the agency handles recruitment, payroll, super, insurance and replacements. For a longer-term role, compare the total cost with hiring direct using the labour hire vs direct hire calculator. If you want a quote built the same way, TQN Personnel supplies labour hire across Australia.
Frequently asked questions
How are labour hire rates calculated?
Start with the worker's award or agreed pay rate, add 25% casual loading if they are casual, then add 12% super, state payroll tax and the workers comp premium. That is the cost per hour. The agency adds its margin on top, and GST is added to the invoice.
What is a typical labour hire charge rate in Australia?
It depends on the role and award. A general labourer or warehouse worker on a lower award level costs less than a ticketed trade assistant, forklift operator or traffic controller. Weekend, night and public holiday shifts cost more because penalty rates lift the pay rate and every on-cost.
Does the charge rate include super and payroll tax?
Yes. The labour hire agency is the employer, so it pays the worker's super and any payroll tax, and recovers them in the charge rate. You should not be billed separately for super on a standard labour hire arrangement.
Why are casual labour hire rates higher than permanent wages?
Casual employees receive a 25% loading instead of paid annual leave, personal leave, notice and redundancy pay. The loading is paid on every hour, and super, payroll tax and workers comp are calculated on the loaded rate, so the hourly charge is higher. The host avoids paying for leave and idle time.
Is GST charged on labour hire?
Yes. Labour hire is a taxable supply, so a GST-registered agency adds 10% GST to its invoice. A host business registered for GST can usually claim that GST back as an input tax credit.
What margin should I expect from a labour hire agency?
Margins vary with the industry, the volume of workers, the length of the booking and the service included. Ask each agency for a full build-up of pay, super, payroll tax, workers comp and margin so you can compare quotes on the same basis.
Related calculators
Sources and assumptions
- ATO: Super guarantee rate
- Revenue NSW: Payroll tax thresholds and rates
- Fair Work Ombudsman: National Employment Standards
General information only, not financial, tax or legal advice. Results are estimates based on 2026-27 figures and the assumptions shown. Check your award, agreement or a qualified adviser for your situation.