The restaurant payroll percentage of sales consists of salaried and hourly employees’ labor costs, employee benefits like insurance premiums, payroll taxes, workers’ compensation insurance, training, discounts, and more.
As a general rule of thumb, the average payroll for restaurants should not cost more than 30% to 35% for full-service establishments and 25% to 30% for limited-service restaurants. In terms of management wages, you generally would not want them to exceed 10% of your sales for either type of restaurant.
If you need help with labor cost management, Homebase’s dashboard will give you great insight into how much you can expect to pay in labor costs per shift. We’ll even tell you the weather forecast so you can determine how many employees need to be on staff for the day.