4 ms·

How do you define the difference between the 40% premium on base pay to get to TCO and the "20% of overhead" for the business as a whole? What sorts of things

• mark_element 8y ago
  Not OP but heath insurance, taxes and other costs that can be marked down exactly as being for Employee #X are in the 40%. Paying for an office having light, power, internet, management, and a mailroom is in the 20%.
• schneidmaster 8y ago
  Not patio, but typically the 40% TCO includes items that scale ~linearly with the number of employees -- health insurance/other benefits, payroll taxes, etc. The 20% of overhead is for things like office space, business insurance, and to cover the salaries of employees like accountants and HR (who are essential but not billable to clients).
• patio11 8y ago
  Depends on the business, but most of the 40% is employer contributions to payroll tax, health insurance, and other per-employee costs, and the 20% overhead is "general and administrative" (office manager, professional services, coffee, etc), coverage for non-billable employees like sales folks (including otherwise billable employees who are below 70% due to winning you the gigs keeping you at ~70%), and what have you. If it isn't obvious, this is a bit handwavy; particular jurisdictions will have rates/requirements which materially influence the 140% figure, etc.
  • tptacek 8y ago
    140% fully loaded also sounds a bit low.