Cost of employee by ekf16301

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									                Item                                                      Cost (£)       Running total   Notes
                                                                                         (£)
                Recruitment and salary
                Salary                                                        42000              42000       1
                Recruitment fee or advertising/selection costs                 4200              46200       2
                Class 1 NICs (12.8% on earnings above Earnings                 4710              50910       3
                Threshold [£100 a week=£5200 a year])


                Typical optional benefits
                Company car                                                         0            50910       4
                Gym                                                               300            51210
                Health care                                                      1000            52210       5
                Life assurance                                                    100            52310
                Pension                                                          1000            53310
                Bonus                                                               0            53310
                Subtotal for NICs calculation                                    2400
                Class 1A NICs (P111D)                                             307            53618       6

                Employee-specific costs
                Software licences                                                1200            54818       7
                Training, CPD                                                    1200            56018       8
                Workstation                                                      9041            65059       9

                Apportionment of cost of business
                Share of other overheads (buildings excluding                    1000            66059      10
                workstation areas, insurances [death-in-service,
                key worker, public liability, employer's liability], …)

                Depreciation on capital equipment (PC, desk, chair,                  0           66059      11
                filing cabinet etc)
                Consumables (paper, toner, coffee, toilet paper)                  100            66159      12
                Administrative overheads (non-project                            2404            68563      13
                administration, HR, payroll, secretarial).

                Other financial and disruptive costs
                Maternity/paternity leave                                            0           68563      14
                Unfair dismissal claims                                              0           68563      14
                Redundancy                                                           0           68563      14
                Jury service                                                         0           68563      14
                Sick leave holiday pay                                               0           68563     14a




                Productive working days                                   Days           Running total Notes
                Weekdays in a year                                                261             261.0    15
                Holidays (25+8)                                                    32             229.0    16
                Formal training                                                      5            224.0    17
                CPD, reading, learning, self-directed training                       4            220.0    18
                Sick days                                                          6.7            213.3    19
                Wasted/unproductive time                                           43             170.6    20

                Cost per day (=total costs/working days)                         £402


                Document updated: 2010/01/08




2b377fd0-f9d3-4ef3-93f8-359b3119c95a.xls             Cost of employee                                            Page 1
       Note    Comment
       1       For a senior technical author typical salary is in the range £35,000 to £50000 according to
               http://www.prospects.ac.uk/p/types_of_job/technical_author_salary.jsp. The average salary for
               a technical author is £33,998: www.itjobswatch.co.uk/jobs/uk/technical%20author.do. When
               you use a freelance technical communicator, you are getting someone with significant
               experience, so we use a representative salary for a senior author.

       2       The Chartered Institute of Personnel and Development (CIPD) calculates the direct cost of
               recruitment at somewhere between £4,000 and £6,000 for managers and professionals
               (www.personneltoday.com/articles/2005/05/10/29666/recruitment-campaigns-how-to-run-
               one.html). Typically, a recruitment agency charges 20% of first year salary. Either way,
               apportion cost over time with company. Using agency figures, and assuming author stays with
               company for 2 years = (£42000*0.2)/2 = £4200/year.
       3       www.hmrc.gov.uk/nitables/ca38.pdf
       4       Car unlikely, even for a senior author.
       5       www.hie.co.uk/article-0107.html
       6       Class 1A NICs =12.8% on all benefits:
               www.businesslink.gov.uk/bdotg/action/detail?r.l1=1073858808&r.l3=1073867977&r.t=RESOUR
               CES&type=RESOURCES&itemId=1075092061&r.i=1073791172&r.l2=1073859218&r.s=sc

       7       A technical author needs specialist software (Help Authoring Tools, HATs)
       8       Continuing professional development and training is not a 'nice to have', it's essential if you
               want your employees to be effective. The figure we've used will cover a UK conference, a
               couple of workshops, and membership of professional bodies.
       9       Average yearly cost of a workstation in SE England (includes costing for premises):
               www.flexibility.co.uk/flexwork/offices/space-costs.htm. Alternatively, average spend per
               desktop for SMEs = £3132; large business = £8445 (Computer Weekly, 28 November 2006
               'Automation of core business systems drives IT spend for large insurance firms'.
       10      Guesstimate.
       11      Don't count this, because we use average workstation cost.
       12      Guesstimate.
       13      Assume one administration person for every ten employees. Assume total salary-related cost is
               £15000 a year, plus £9041 workstation cost = £24041 a year total. Divided by ten = £2404.

       14      Not able to find any figures for these. Haven't got a clue about estimates.
       14a     See 'Holiday rights for employees on long-term sick leave', 2009/01/21,
               www.gibsonbooth.co.uk/item/25181/601/160/260/23192B44/5396
       15      (52*5)+1 because there are 52 weeks and one day in a year.
       16      Minimum holiday is 28 days as of 2009/04/01, but that includes 8 days bank holidays:
               www.berr.gov.uk/whatwedo/employment/employment-legislation/employment-
               guidance/page28979.html#paid_annual. According to
               www.cipd.co.uk/subjects/wrkgtime/general/wrktimlve.htm, professional workers get
               approximately 25 days plus bank holidays.
       17      Table 28 in CIPD Annual survey report 2007: www.cipd.co.uk/NR/rdonlyres/EB18FA28-BD40-
               4D47-81B9-660034D280C1/0/learndevsr.pdf
       18      Guesstimate.
       19      Study by CBI and insurers Axa: on average workers took 6.7 days off in 2007, down from seven
               days in 2006 (www.gibsonbooth.co.uk/item/21516/23192F44/4579).

               (Previous years. 7 days: Norwich Union Healthcare study (2001),
               www.hse.gov.uk/costs/ill_health_costs/ill_health_costs_intro.asp.)




2b377fd0-f9d3-4ef3-93f8-359b3119c95a.xls                 Notes                                                   2
       20      Average wasted time: 1.7 hours out of a typical 8.5 hour day
               (www.hrmguide.com/performance/wasting-time.htm) = 20%.
               Business Link South Yorkshire Business Information Service Newsletter - 31st October 2005.

               "More than a third of working time is wasted. Can your company use its time more wisely?"
               Used to be on http://blsy.creativemessage.com/Newsletter.aspx?s=a2deed1f-cbc9-491f-a8e6-
               6a1ef37a0ed4&l=2&n=1&i=104&c=0&a=1001&o=1, but it's not available as of 2007/11/15.

               "A poll carried out among 776 office workers indicated that most spent at least 30 minutes a
               day visiting social networking sites, and two were so hooked that they engaged in such
               activities for up to three hours each day" ('Don't get stung by social networks', Computer
               Weekly, 4 March 2008.)




2b377fd0-f9d3-4ef3-93f8-359b3119c95a.xls                 Notes                                                3

								
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