Thinking about staffing alternatives? First, find out how much are you really paying your Building Staff
Make the right decision with our ultimate calculator to compare the total cost of an employee vs. a staffing agency
In a nutshell, this Calculator figures out how much your building staff costs, including:
- Employer's taxes, which is over and beyond the total gross wages you pay;
- Workers Compensation and Disability Insurance, which covers things like job-related injuries
- Holiday Pay, Vacation Pay and other benefits
- Breaks yearly salary down to the hourly cost. This makes apples-to-apples comparison easy!
- Calculates Prevailing Wages: For buildings required to pay Prevailing Wages and Supplemental Benefits rates, you're covered. Use this calculator to find your Prevailing Wages and Benefits for your employee, depending on his / her position.
- New -Try this out! "Say, what's your neighbor paying?" Compare your employee salary with the rest of the industry. A green light means you are in the right salary range!
- More industry comparisons! Compare your employee pay to Salary.com, Indeed.com and U.S. Bureau of Labor Statistics!
- It's fully interactive and displays results on easy-to-read graphs! But more than looking pretty, graphs make it easy to understand the numbers and what the cost drivers are.
Property managers, Board members and anyone who is looking to understand the drivers behind payroll, especially when dealing with multiple line items like overtime pay, benefits, insurance, etc. Find how these payroll factors are interrelated.
Over the years, I've found many Co-ops and Condos to be ill-equipped to weigh the decision of whether it's more budget-sensible to hire its building maintenance workers indirectly through an outside Contractor or Company or employ them directly as W2 employees.
That's because to do so accurately requires understanding the numbers behind the payroll and how these numbers are impacted by the laws (of federal, state and city), market pressures and local industry practices.
Each maintenance role, such as building superintendent, porter, doormen or security, may have its own set of hourly rate, benefits offered and statutory formulas that applies to its payroll. With so many laws and formulas, it's easy to understand why payroll is one area of a building's budget where the numbers are often easily misunderstood.
To make the right financial decision, one has little choice but to understand these payroll numbers. Especially if you are a Treasurer on the Board of Directors, or property manager, It will be critical to understand the payroll and the drivers behind numbers in order to accurately compare the pricing of alternative staffing solutions. Once you compare the unit of cost, you can make the judgement that one solution or Company is better than the other.
So, with so many issues out there, this case inspired me to create a payroll calculator to help determine what the building may be paying these employees per hour. Once again, the reason why this cost per employee hour is so important is that Spark Super (as well as many other staffing agencies) would generally charge its clients an hourly rate for each team member. You would need to know how much the total cost per hour of your in-house employee is before you can make an apples-to-apples comparison with the hourly rate of a staffing agency.
By total cost, I would include the benefits, employer's tax and worker's compensation since the employer (the Co-op) would normally pay this on top of the employee gross paycheck. If you hire a staffing agency, a big benefit is that the Co-op would not have to pay these individual costs and everything would be rolled into a single hourly charge paid to the staffing agency. Then, the Co-op would receive a single bill at the end of the month for all of the employment related services. It can be a win-win situation... only if you know your numbers!
"So, where do I start?"
To start, employer-employee relationships come with additional costs to the employer, such as federal (FUTA) and a state unemployment tax. These costs are required by law and paid by the employer on top of the employees' gross salary.
Not surprisingly, there are another set of costs that are often missed: benefits. Some benefits are required by law and others are at the discretion of the employer. Whichever is the reason, you must include them in the payroll calculation.
Such benefits include:
- Paid Time Off ("PTO") such as vacation time, holidays, sick days
- Health insurance and other benefits
- Bonus (holiday, yearly merit bonus, etc.)
- Stipends (cell phone, apartment rent, etc.)
Finally, there's other costs not directly related to the payroll but which is ultimately a cost that an employer must pay for an employee who is on payroll. These are such things as:
- Worker's Compensation
- Disability insurance
Welcome to my free calculator
To help calculate the total costs associated with employing building staff, I created the calculator below. Simply input the data and the calculator will automatically calculate the rest for you.
Each of the above costs, such as vacation, holiday, employer's FUTA tax, Worker's Compensation insurance, etc., is a cost item that shows up in the calculator's result, if it's applicable. The result is a comprehensive picture of the entire cost related to your employee.
This calculator also has the option to calculate a salary of an employee who is entitled to Prevailing Wages. If you don't know if your particular building is required to pay its workers prevailing wages, click here for more details (official NYC link).
How a Board Treasurer and Property Manager should use this calculator
This calculator not only breaks down the salary of the employee to show how much is being paid for every benefit offered by the employer, and for statutory expenses, such as Worker's Compensation; but it also gives a clearer picture of what the building is paying its employee(s) in totality per year and, ultimately, per hour cost.
Knowing these unit costs, especially the cost of every staff hour, gives you the insight you need to determine the tradeoff of the following situations:
- whether to hire an outside firm when labor is needed or to hire the worker(s) in-house;
- if an employee is going on vacation (or is taking PTO), whether to hire an outside firm to cover this period with temporary workers or to give your employees overtime;
- which outsourced firms are providing competitive pricing and also which makes sense to your budget;
Because a staffing firms' pricing rates can be reduced to an hourly fee, knowing your own in-house staff's hourly rate will help you confidently make the apples-to-apples comparison needed to determine whether the outside staffing arrangement makes sense.
Use our Payroll Cost Calculator Below
How can we help you? Use our free tools for Co-ops and Condos
Below are some tools to help you on your way to turning your Prevailing Wages expense into an investment.
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