Staff Cost and Rota Margin Calculator
The headline wage is never the full cost. Add employer NIC at 15% (above the £5,000 secondary threshold), auto-enrolment pension at 3%, and any tronc contribution to see what each employee actually costs per hour and what that means for your labour percentage.
Staff Cost and Rota Margin Calculator
The headline wage is never the full cost. Add employer NIC at 15% (above the £5,000 secondary threshold), auto-enrolment pension at 3%, and any tronc contribution to see what each employee actually costs per hour and what that means for your labour percentage.
The National Living Wage from 1 April 2026 is £12.71/hr for workers aged 21+.
Average contracted or rota hours per week for this employee.
Total weekly revenue for your site, used to calculate labour as a percentage of revenue.
If the employee receives tronc, enter the effective hourly equivalent. No employer NIC or pension is payable on tronc via an independent troncmaster.
Adjust if the role is seasonal (e.g. 26 weeks for a summer venue).
Labour is at or below the 30% benchmark. Good rota efficiency.
Check your position with a hospitality accounts specialist
A calculator gives you the shape of the answer. We confirm your exact figures, the reliefs you can claim, and what your business needs to file. No obligation, and we reply within one working day.
True staff cost in hospitality: beyond the headline wage
The National Living Wage for workers aged 21 and over rose to £12.71 per hour on 1 April 2026. But that figure understates the real cost of employment by 20% or more once employer NIC and pension are included.
Employer National Insurance is charged at 15% on earnings above the secondary threshold of £5,000 per year (2026/27). A full-time employee on the NLW costs roughly £1,300 to £1,500 per year in employer NIC alone. The 2025 Budget raised the employer NIC rate from 13.8% to 15% and cut the secondary threshold from £9,100 to £5,000, significantly increasing the per-employee cost for hospitality businesses.
Auto-enrolment requires employer contributions of at least 3% on qualifying earnings between £6,240 and £50,270 per year (2026/27). For a full-time NLW worker, that adds roughly £350 to £400 per year.
Tronc tips, distributed via an independent troncmaster, are exempt from both employer and employee NIC. The tronc amount therefore costs the employer at face value, with no NIC uplift, making it a genuinely lower-cost way to reward staff. This calculator separates tronc from wages so the true blended hourly cost reflects reality.
The 30% labour cost benchmark is a widely used rule of thumb in hospitality. Labour above 35% of net revenue is typically unsustainable for most venue types. Kitchen-heavy operations (fine dining, hotels) often run at 28-32%; wet-led pubs can go lower; high-service restaurants closer to 34-36%.
Frequently asked questions
What is the National Living Wage from April 2026?
£12.71 per hour for workers aged 21 and over, from 1 April 2026. The rate for 18-20 year olds is £10.85 and for under-18s and apprentices is £8.00.
What is the employer NIC rate for 2026/27?
15% on earnings above the secondary threshold of £5,000 per year (£96 per week). The rate was increased from 13.8% and the threshold cut from £9,100, both effective from April 2025.
What pension contribution does the employer have to make?
Auto-enrolment minimum employer contribution is 3% on qualifying earnings between £6,240 and £50,270 per year (2026/27). The employee contributes at least 5%. New starters aged 22-66 earning above £10,000 per year are auto-enrolled.
Does tronc reduce employer NIC?
Yes. Tronc distributed via an independent troncmaster is exempt from employer NIC (and employee NIC). No pension contribution is required on tronc payments either. PAYE income tax still applies.
What is a healthy labour cost percentage for a hospitality business?
30% of net revenue is the industry benchmark. Above 35% is a warning level for most venue types. The right number varies: a bar with automated ordering can run at 20%; a fine-dining kitchen may need 34%. Track it weekly against covers and revenue.
Want to be sure of your position?
Tell us about your hospitality business and we will confirm your exact figures and the compliance steps that apply to you. No obligation.