1. What is Fully Burdened Labor Rate?

The Fully Burdened Labor Rate (FBLR) represents the total cost of an employee's time, including not only their base wage but also all associated overhead costs such as benefits, taxes, insurance, and other indirect expenses.

2. How Does the Calculator Work?

The calculator uses the FBLR equation:

Where:

• \( BR \) — Base Rate ($/hr)
• \( BF \) — Burden Factor (decimal)

Explanation: The burden factor represents the percentage of additional costs beyond the base rate, expressed as a decimal (e.g., 0.30 for 30%).

3. Importance of FBLR Calculation

Details: Accurate FBLR calculation is crucial for project costing, budgeting, and determining the true cost of labor in business operations and contract bidding.

4. Using the Calculator

Tips: Enter the base hourly rate in dollars and the burden factor as a decimal. Both values must be valid (base rate > 0, burden factor ≥ 0).

5. Frequently Asked Questions (FAQ)

Q1: What is typically included in the burden factor?
A: The burden factor typically includes employer-paid taxes, benefits, insurance, retirement contributions, and other overhead costs associated with employment.

Q2: How is the burden factor determined?
A: The burden factor is calculated by dividing all indirect labor costs by the total base payroll costs, usually expressed as a percentage.

Q3: Why is FBLR important for contractors?
A: Contractors use FBLR to accurately price their services, ensuring all labor-related costs are covered while maintaining profitability.

Q4: Does FBLR vary by industry?
A: Yes, burden factors can vary significantly by industry, company size, geographic location, and benefit packages offered.

Q5: How often should FBLR be recalculated?
A: FBLR should be reviewed and updated regularly, typically annually or whenever there are significant changes to labor costs or benefit structures.