employed vs self employed hourly rates

Will_S

Hi,

Can anyone explain to me how you would go about working out how much per hour someone employed would be on if they were self employed in the same job? This is simply to compare two people doing the same job, one employed, one self employed, and trying to get them to be basically on the same annual salary, without forcing one to change their employment status.

The self employed person is on £17 per hour. How much should the employed person be on? They get 32 days holiday per year, along with the standard sick pay etc, but no company pension.

Thanks in advance!

Will

Pennywise

S/e hourly rate is usually at least 25% more, often 50% and maybe even up to double the employed hourly rate, so in your example, I'd say somewhere around £8-£14 per hour. £17 per hour for s/e is really bargain basement so isn't too far from minimum wage for an employed equivalent.

The difference isn't just for holidays, there's also 13.8% national insurance, potential sick/maternity pay, training, administration, etc. The self employed person has to pay their own insurance, accountancy fees, etc.