When comparing labour hire to permanent employment, the hourly charge rate can look higher at first glance. But permanent employees carry significant hidden costs that most businesses don't factor into their per-hour calculations. Here's how a $65,000/year permanent employee actually compares:
*Based on 1,850 productive hours/year (52 weeks minus 4 weeks annual leave, 2 weeks sick/personal leave, 8 public holidays, plus typical unproductive time). Actual productive hours are often lower.
¹ Workers' comp premiums vary by industry: office/admin ~3%, warehousing & logistics ~3–4%, manufacturing ~4–5%, construction & trades ~5–8% of wages.
² Payroll tax rates by state: SA 4.95%, QLD 4.75% (plus 0.25% mental health levy on payroll above $10M), NSW 5.45% (plus COVID-19 health levy surcharge above $10M). Thresholds and exemptions may apply.
³ Long service leave accrual estimated at 1.67% of base salary (varies by state legislation).
Labour hire gives you flexibility to scale up or down with demand, eliminates recruitment risk, and means you only pay for productive hours worked. No annual leave liability, no redundancy risk, no recruitment fees.