Recommended contractor hourly rates
Professionals Australia can provide you with access to the current contractor hourly rates for Professional Engineers. Please note these rates apply to independent contractors who cover their own on-costs including PI insurance, superannuation, salary continuance in lieu of workers compensation, etc. They do not apply to contractors working through an agency where the agency employs them and covers many of these expenses. In these cases, the rates should be altered to take account of the costs covered by the agency.
The rates should be read in conjunction with the responsibility level definitions attached.
Contract rate calculator
The objective of this calculator is to provide a way of estimating what to charge if you’re currently engaged as a salaried employee and are considering operating as a contractor and charging an hourly rate.
The tool takes into account conditions of employment you must cover the cost of yourself as a contractor such as public holidays, annual leave, sick leave, etc., combined with on costs such as superannuation and professional indemnity insurance, plus a range of business expenses.
Please note this tool is intended to be used by independent contractors who cover their own on-costs including PI insurance, superannuation. salary continuance in lieu of workers compensation, tools and equipment, office space, etc. The tool will have limited application for contractors working through an agency because either the agency engaging them covers a number of the expenses itemised in the spreadsheet, or the itemised expenses are not relevant to agency arrangements.
Instructions for use
The calculator is structured as an Excel spreadsheet using a formula so you can only change cells that are not coloured yellow, blue or orange. The green cell is the target annual salary which you can change. If there is a business expense included which is not relevant, you can value that item at zero. If you add or delete items, make sure the ranges in the Excel formula referring to the cells are still valid.
If you’re working through a labour hire agency, they cover some of the expenses listed under Other Costs such as superannuation so make sure you don’t count an item twice. The calculator provides for rates for 37.5 and 40 hours per week (see pink headings at the top of the spreadsheet) and which are GST inclusive or exclusive. The final rates (GST inclusive and exclusive) for short and long term are marked in blue.
Important Note
Save the contract hourly rate calculator to your computer before making any changes.
Click the link to the Calculator with your left or right mouse button. When prompted to open or save the file, select the option ‘Save Target As’, ‘Save to Disk’ or ‘Save Link As’. Save it to a location on your computer you can easily find, e.g.
My Documents.
Any changes that you make to the document whilst it is open in your browser may not saved or may be lost.
Contractor hourly rate calculator.
Disclaimer
There is no substitute for a well founded knowledge of the value of the particular professional and/or technical service in the particular industry in which contractors are operating. Because independent contractors are comprised of such a diverse group of professional services deployed in such a range of contexts, this information is intended as a guide only. A range of circumstances can and do affect the appropriate rates in the actual market place. Professionals Australia makes no representation in any form as to the accuracy of the information contained in this work and cannot accept any legal responsibility for errors, omissions or consequences of any action taken by individuals using the calculator.
Acknowledgements
Professionals Australia acknowledges the generous assistance of Ian White of WAI Engineering in the preparation of this material.