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FormulaCost price per hour = (gross wages + employer contributions + accruals + travel expenses) ÷ hours worked

Accruals include the holiday pay and leave days that employees build up. Divide by hours worked, not by hours paid, or an hour looks cheaper than it is.

Why it matters

No real cost price, no real margin. A rate based only on the hourly wage can quietly become loss-making through allowances, travel expenses or a higher pay step.

Where it goes wrong

Allowances for unsocial hours, weekends and overtime are forgotten, or travel expenses sit in another system. Wages and pay steps also often rise faster than rates.

How Dashly calculates it

Dashly calculates the cost price per payroll run from your payroll and divides it by the hours worked. If the cost price rises and the rate does not follow, you get an alert.

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