Free Restaurant Labor Cost Calculator
Enter weekly sales, hourly wages, salaried payroll, payroll tax, benefits, and total labor hours. The calculator returns total labor cost, labor cost % of sales, sales per labor hour, and tags whether your number is lean, healthy, on watch, or critical.
Labor cost calculator
Run the formula on your own weekly numbers.
Total labor cost
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Labor cost % of sales
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Sales per labor hour
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Tip: use the same week for sales, hours, and payroll. Compare your percentage against the healthy bands listed below for your format. The calculator loads payroll tax at 12% and benefits at 8% as US-style defaults; adjust to your country.
Why labor cost is the line that decides the year
How to use the calculator
Six inputs. The calculator does the math live and returns three metrics plus a tier badge.
- 1
Enter weekly sales from your POS - net of comps, voids, and discounts.
- 2
Enter hourly wages paid for the same week, before taxes and benefits.
- 3
Enter salaried payroll allocated to that week (annual salary ÷ 52 for each salaried role).
- 4
Enter payroll tax percentage on top of gross wages - typically 7-15% depending on jurisdiction.
- 5
Enter benefits percentage - health, retirement, paid leave accrual - typically 5-15%.
- 6
Enter total labor hours worked across all employees that week. Read the labor cost %, sales per labor hour, and tier badge.
The labor cost formula
Two formulas that work together:
Total Labor Cost = (Hourly Wages + Salaried Payroll) × (1 + Payroll Tax % + Benefits %) Labor Cost % = Total Labor Cost / Weekly Sales × 100 Sales Per Labor Hour = Weekly Sales / Total Labor Hours
Labor cost % is the headline metric. Sales per labor hour (SPLH) is the productivity metric - it tells you how much revenue each scheduled hour generates and surfaces over-scheduling that the percentage alone can hide on a strong sales week.
Healthy benchmarks by restaurant format
These are the bands operators in each format target. The calculator badges your input automatically.
| Format | Healthy band | Notes |
|---|---|---|
| Fine dining | 32-38% of sales | Higher service ratios; offset by check size. |
| Casual full-service | 28-34% of sales | The classic operator band. |
| Pizzeria | 22-28% of sales | Smaller team, lighter prep, dough is forgiving. |
| Quick-service restaurant | 22-28% of sales | Volume model; scheduling discipline is the lever. |
| Bar / pub kitchen | 25-30% of sales | Lighter kitchen labor; bartender labor on the beverage side. |
| Hotel F&B | 32-40% of sales | Banquet seasonality, embedded shared services. |
A worked example
A 70-cover bistro running an average week:
- Weekly sales: $30,000
- Hourly wages: $7,200
- Salaried payroll: $1,400
- Payroll tax: 9% · Benefits: 7%
- Total labor hours: 540
Total labor cost = ($7,200 + $1,400) × (1 + 0.09 + 0.07) = $8,600 × 1.16 = $9,976
Labor cost % = $9,976 / $30,000 = 33.3% ✓ inside the 28-34% casual full-service band
Sales per labor hour = $30,000 / 540 = $55.56 per hour
The number is healthy. If next week the labor % climbed to 36%, the action is to pull the schedule and look for the overtime hours, the unfilled shifts that triggered emergency cover, and the salaried managers who covered hourly shifts instead of leading the floor.
Frequently asked questions
What is a good labor cost percentage for a restaurant?+
It depends on format. Casual full-service typically targets 28-34%, fine dining 32-38%, QSR and pizzeria 22-28%, bar kitchens 25-30%, hotel F&B 32-40%. The right answer for your restaurant is whichever band lets you hit a prime cost (food + labor) target of ≤ 60% of sales.
Should I include payroll tax and benefits in labor cost?+
Yes. Gross wages alone understate the real cost by 10-25%. The operator metric that actually matches the P&L is fully-loaded labor (wages + taxes + benefits), which is what this calculator returns. Tracking gross wages only is a common mistake that hides 3-5 points of cost.
What is sales per labor hour (SPLH) and why does it matter?+
SPLH is weekly sales divided by total scheduled labor hours. It is a productivity metric the labor % alone can miss. On a strong sales week, labor % can look healthy even though you over-scheduled - SPLH catches that. The target depends on format but $40-60 per hour is normal for full-service, $60-90 for high-volume QSR, $80+ for fine dining.
How often should I check labor cost?+
Daily for the schedule and overtime; weekly for the % and SPLH; monthly for the trend. The operators who hold the line check the schedule every shift, run the labor % every Monday for the prior week, and review the four-week trend at the monthly P&L. Quarterly is far too slow.
How do I reduce labor cost without hurting service?+
Five levers in order of impact: tighten the schedule against forecast sales (most operators over-schedule the slow shifts and under-schedule the peaks), reduce overtime (every overtime hour is 1.5x), cross-train to flatten the peaks, audit salaried-vs-hourly mix (a manager covering hourly shifts is hiding cost), and look at scheduling software that reads the POS and forecasts labor demand. None of these mean cutting hospitality.
Does this calculator store my data?+
No. The calculator runs entirely in your browser. Nothing is sent to a server, nothing is logged, nothing is stored after you close the page. Safe for commercially sensitive payroll numbers.
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