A Staffing Provider’s Hourly Rate: What It Is Made Of

A staffing provider quotes an hourly rate well above the workers’ wage. That is normal. Here is what the rate is made of and what to look at when comparing offers.

From wage to billing rate

The hourly wage is only the start. On top of the gross wage come employer costs that the provider has to carry whether or not the person is currently working for you. The rate you pay covers all these components.

The main components

Gross wage: at least the statutory minimum wage of €12, often more depending on sector and qualification.
Employer contributions: pension, health, unemployment and long-term care insurance together amount to roughly 20 percent of gross wages. Levies and the accident insurance contribution come on top.
Downtime: holiday, public holidays and sickness are paid without work being done. These costs have to be spread across productive hours.
Additional costs: depending on the assignment, accommodation, travel, work clothing and surcharges.
Administration and risk: payroll, contracts, insurance, liability and recruiting.
Margin: the profit that sustains the company.

An illustrative calculation

Assume the gross wage is €13. About 21 percent employer contributions add roughly €2.70, bringing it to just under €15.70. Counting downtime at around 15 percent, the cost per productive hour rises to about €18. Administration, risk and margin come on top. The figures are an example; actual values differ from case to case.

What to look at when comparing

Are accommodation, travel and work clothing included in the rate or separate?
Are there surcharges for nights, Sundays and holidays?
How long does the rate apply, and when does equal pay start? More in maximum duration and equal pay.
A conspicuously low rate can be a warning sign of wage dumping or illegal work. Vet your partner as described in the article on how staffing providers select and vet workers.

Checklist for the offer

Which costs are included in the hourly rate?
Which minimum wage and surcharges apply?
How are hours documented?
What are the minimum term and notice period?
What proof of permit, insurance and social contributions is available?

Frequently asked questions

Why is the rate higher than the wage?

It includes social contributions, paid downtime, additional costs, administration, risk and the provider’s margin.

How much are the employer contributions?

Roughly 20 percent of gross wages for social insurance, plus levies and accident insurance.

Is a low hourly rate a good sign?

Not necessarily. Very low rates can point to violations of minimum wage or contribution duties. Check the proof.

What can lower the rate?

Longer assignments, better predictability, fewer extra services and larger volumes can lead to better terms.

Would you like an offer?

We calculate transparently and discuss it with you.

Looking for a job? Write to us directly.Telegram @dlp_r