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How much do employees cost?

Started by icex, December 27, 2015, 03:49:53 PM

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icex

I'm trying to put together some numbers for 2-3 employees. How much generally does workers com run you guys for employees?

Shotgun

I would bet with more particulars, you'll get some pretty good answers. It would be helpful to show where you're located in your profile. What will these employees be  doing and how much experience do you need them to have?  And so on...
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Dave Shepard

Just call your insurance agent. Two years ago I had to buy comp for a project, even though I was a sub. For carpentry, it was, I think $8.41/$100 payroll. I asked about sawmill, and they said it was less than carpentry, which was a surprise to me.
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4x4American

That's interesting, Dave...this is something I'll be looking into once I get established better.
Boy, back in my day..

Dave Shepard

Varies a lot by state. I think my boss said it costs him about 20% for us in NYS.
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Jeff

Take a look at the rate sheet from the Michigan association of Timbermen's Self Insurance Fund.
http://matsif.com/2014-15-rate-sheet.pdf

You can see the answer varies widely here by what that employee is doing.
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brendonv

Arborist work here in ct. 38% for comp.

Another 50%+ by the time i factor in everything else.

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john

Gearbox

Back in the day of chainsaw falling and cable skidders in think MN was getting close to  50 % .
That is why you need to break down the man hours  by what he is doing every hr. Shop is cheaper than driver ect.
A bunch of chainsaws a BT6870 processer , TC 5 International track skidder and not near enough time

BargeMonkey

 Because logging makes up less than 30% of our gross we are in the state funding for comp which was 42/100 last time I checked on logging. Add in SS, payroll tax, medical if fulltime, the list goes on. I figure you need to charge/ produce 3x minimum what your paying someone to cover your cost, the rest goes back to the equipment, your left with the scraps for profit.  :D Im adding 12 more employees by memorial day paid as cheap as I can get,  not looking forward to it at all.  Watching this guy down the road with 2 big new forwarders and a new processor ship 8 trailer loads a day, 2mil bucks sitting there to chase redpine, no thank you.

azmtnman

NOT a business guy but I have paid attention in the business world (not logging and forestry though). What about the temporary employment services? I worked for one once. The company hired me and then had me go register through the temp service they used. It is a little shifty to keep them employed like that IMO but it could be a "test drive" before you actually hire someone. They might be getting better insurance rates because they have several 1000 employees versus our 1 or 2.
Just a thought.
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NWP

Obviously we need to know what duties they are performing. I'm in the sawmill classification for firewood processing and mulch production. It costs me $23/$100. Plus payroll taxes.
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icex


Ron Scott

 2-3 timber fallers would usually be at the highest workman's comp cost. Subcontracting this work where you don't establish their required hours of work etc. might cost you less.
~Ron

beenthere

Quote from: icex on December 27, 2015, 10:59:49 PM
It will be 2 timber fellers.

Click on your forum name and it will take you to where you can update your profile with your location at least. Also other info to add there too.
Helps with answers to your questions and am sure it helps you when you read other members' posts. ;)
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starmac

It will vary from state to state. One logger and sawmill owner I knew that closed up shop several years agoo here, told me it was because of his WC costs. At that time he claimed 76% for the logging crew, and 54% for the mill crew. He did run the mill another year after he shut down the logging crew.
This is just what one owner told me, I can't verify these numbers.
A new logging crew operator I know that just started up last year told me that the difference in WC would pay for his feller buncher over what it would cost to hand fall.
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Ryan D

I don't know how you guys can afford those rates!!! We are at $5.40 per $100 here and logging is the highest rate in the province.

OntarioAl

Our rates in Ontario are lower because of the socialized medical cost which covers the Doctor/Hospital fees. The rates do mirror the experience of the Michigan rates.
Logging in Ontario is at 13.4 % up to a maximum of $85,200 wage ceiling per employee.
The annual published rate is for a company with zero compensable claims surcharges are applied to companies with a poor record (based on the number of employees).
In essence small companies feel the effect of one lost time claim more than large companies with lots of employees.
Getting back to the OP if you were logging in Ontario with employees your payroll burden can add 30 to 40 % to an hourly rate.
Hope this helps
Al 
Al Raman

gspren

    While WC is the biggest extra it's not always the only one. I was a machinist my whole career but a boss the last 9 years and while calculating costs for an employee there was also a portion of their health insurance, holidays, sick days, vacation days, training, safety equipment and break time. I know a small outfit doesn't have all of these but it is why many businesses hire "contractors" that often appear to be regular employees but actually work for themselves and contract so many hours to your business.
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icex

Quote from: gspren on December 28, 2015, 09:00:51 AM
    While WC is the biggest extra it's not always the only one. I was a machinist my whole career but a boss the last 9 years and while calculating costs for an employee there was also a portion of their health insurance, holidays, sick days, vacation days, training, safety equipment and break time. I know a small outfit doesn't have all of these but it is why many businesses hire "contractors" that often appear to be regular employees but actually work for themselves and contract so many hours to your business.

This is actually what I have been considering. My book keeper said for them to have their own business license, etc, but with that comes great risk. Even if they have their own business license and are "sub-contractors" there is always that possibility they can turn around and sue you for workers comp and claim they was a employee but not paid hourly. What a mess.

Raider Bill

According to the IRS if you are their only work source, dictate hours, workload, place of work etc then they are employees.
The First 70 years of childhood is always the hardest.

BargeMonkey

 The "subcontractor" game doesn't fly around here, unless you can show them as a complete separate business and your just buying the logs, maybe. Comp is the killer, NY used to have quite a few private funds, I think there are 2 left now. Hiring guys to handcut is going to be expensive, plus in the wages you need to figure who is providing what ? Saws ? Parts ? Fuel? A cutter who owns his own saw is going to treat it that way, some yahoo starts crushing saws doesn't take long to eat up your money.

gspren

   Using sub contractors works best for short term, temporary, fluctuations in work load. Take anything I'm about to say as an old man's memories from a job I retired from over 4 years ago, I'm not a lawyer! Contractors need a very specific job description that can not be the same as your regular employees, don't ask them to do anything not in their job description. Do not treat a contractor like an employee, meaning if you pay your employees a year end bonus on a good year, don't give it to the contractors. Having a Christmas party for employees and their families, don't invite the contractors. I was a supervisor in a shop with 14-16 regular employees and 3-4 contractors and it's tricky to do it right, people get upset about not treating the contractors the same but that's the way I was told it had to be.
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Grandpa

Here in Wi. I think it was around 56% the last time I checked for a saw hand.
When reading this thread, it looks like it varies a lot depending on where you are.

Holmes

Along with workmen's comp$.  You need to withhold social security and medicare about 8% and then you have to match that 8% withholding and pay the total at the end of the month to the federal government.Will you also withhold federal and state income taxes?  I hear steeplejacks are 100% comp rate!!!!!!
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