Restaurants & Hospitality: How to Calculate Your Payroll Costs (2026)

Managed payroll by headcount for a restaurant

10 employees: $450 a month, $5,400 a year; 25 employees: $1,125 a month, $13,500 a year; 50 employees: $2,250 a month, $27,000 a year; 100 employees: $4,500 a month, $54,000 a year. Every row is $45 per employee per month, all-inclusive, inside the payroll software you already use, with no monthly minimum, so the per-employee cost is the same at 10 as at 100. Nothing in the restaurant setup, tip credit and tip pooling, high turnover, multiple pay rates and split shift premiums, is billed as an add-on.

The employer-side tax that rides on every restaurant wage

At the May 2025 national median for waiters and waitresses, $35,230 a year or about $17 an hour, the employer share of Social Security and Medicare is $2,695 per employee per year and FUTA is $42 after the state credit, before state unemployment at the assigned rate. Those costs are the same whoever runs payroll; the calculator question is only who does the work and who carries the error.

An employer that normally employed more than 10 employees on a typical business day in the preceding calendar year at a food or beverage operation where tipping is customary must file Form 8027 for each such establishment. If total reported tips for a payroll period are less than 8 percent of gross receipts, the shortfall must be allocated among directly tipped employees and shown in box 8 of Form W-2.

The in-house line in the calculation

BLS OEWS May 2025: payroll and timekeeping clerks, national median $58,260, mean $59,630. Add roughly 30 percent for benefits and employer taxes, about $75,738, before the software that person runs, and set it against the headcount rows above. Managed payroll stays under that loaded figure until about 140 employees.