Calculate price per hour worked

The term “wage” and its size are very important in national discussions about labor markets, taxes and insurance payments, but also part of international comparisons for investors deciding to build a factory or place investments in some country. A lot of confusion has been created by the introduction of gross wage, with arbitrary distinction between “employee paid” and employer paid” taxes and contributions. However, this is countered by introduction of total wage cost in international statistics.

Yet, total wage cost does not provide complete picture about labor cost at all. It does not count paid holiday, sick leave, it does not count employee related costs like obligatory meal vouchers and other benefits and similar. Importantly, it does not count various surcharges required by national law (nighttime work, holiday work, etc.).

Four think tank – INESS (Slovakia), IME (Bulgaria), FOR (Poland) and Liberal Institute (Czechia) with the generous support of the Friedrich Naumann Foundation collaborated and created national calculators Price of the Employee.

Using the methodology created in 2019 by INESS, these four national calculators take numerous inputs from an user (wage, number of overtime, or nighttime hours etc.), calculates all monetary costs and discounts time spent out for work (holiday, state holiday, sick leave, etc…) and returns the price of the employee – the total cost of man-hour and man-month spent working. 

While the gross wage being the same, the true cost per hour worked differs wildly among the countries. The relative size of the price of the employee changes when we change the model employee, with some countries having higher obligatory pay surcharges than others.