Free tool

Restaurant labour cost calculator

Find out what percentage of your revenue goes to staff wages. Compare against UK hospitality benchmarks and spot where you can save.

Enter your numbers

£
£

UK National Living Wage (21+) is £12.71/hr from April 2026

This is a planning estimate, not payroll. It uses gross wages only — it does not include employer National Insurance, pension contributions or holiday pay accrual, so your true cost of employment is higher than the figure above.

What is labour cost percentage?

Labour cost percentage is the proportion of your revenue that goes to paying staff wages. It’s one of the most important metrics for any hospitality business. In the UK, the typical range for restaurants, pubs, and cafes is 25–35% of gross revenue. Quick-service venues tend to be lower (20–25%), while fine dining often runs higher (30–40%).

How to work out labour percentage

Divide what you paid staff in a period by the revenue for the same period, then multiply by 100. A venue that paid £6,300 in wages in a week it took £21,000 has a labour percentage of 30% — £6,300 ÷ £21,000 × 100.

Use the same period for both figures. And be clear what the wages include: this calculator uses gross wages only, so adding employer National Insurance, pension and holiday pay accrual gives a higher, truer percentage.

How to reduce your labour costs

  • Schedule based on demand. Match staffing levels to your busy and quiet periods rather than running the same rota every week.
  • Track actual hours vs. scheduled hours. Late clock-ins and unapproved overtime add up fast. GPS clock-in removes guesswork.
  • Cross-train your team. Staff who can cover multiple roles give you more flexibility without hiring extra heads.
  • Reduce no-shows with shift swaps. Let staff arrange their own cover instead of leaving you short-handed.

UK minimum wage rates from April 2026

Age groupHourly rate
21 and over (National Living Wage)£12.71
18 to 20£10.85
16 to 17£8.00
Apprentice£8.00

Rates as at 26 August 2026. Minimum wage rates change every April — check the current rates on GOV.UK before you budget off them.

Rates apply UK-wide

National Minimum Wage and National Living Wage rates are set UK-wide, so these apply whether you trade in England, Scotland, Wales or Northern Ireland.

Track this automatically with ClockRota

Real-time labour cost tracking, GPS clock-in and payroll exports. £0 during the public beta, then £9/month for teams up to 5.

Join the public beta

Also useful: 12.07% holiday pay calculator

Calculate statutory holiday for full-time, part-time and zero-hours staff. Covers pro-rata and the 12.07% accrual method.

Try it free

Sources

  1. National Minimum Wage and National Living Wage rates — GOV.UK — the April 2026 rate table, checked 26 August 2026

Changelog

30 July 2026Rebuilt on the design system as part of the Astro migration. Calculation carried over unchanged.
26 August 2026Stamped the rate table with an "as at" date, and moved into the tools content collection so review_by is enforced at build.
22 September 2026Added how to work out labour percentage, with a worked example. New description. Calculation unchanged.