The employer cost beyond the salary figure
In the UK, the cost of employing someone is higher than their gross salary once you add employer National Insurance contributions and pension auto-enrolment. Employer NI applies at 13.8 % on earnings above the secondary threshold (£9,100 per year as of 2024-25). Minimum pension contribution from the employer is 3 % of qualifying earnings.
For an employee on £40,000 gross, employer NI adds around £4,254 per year and minimum pension around £900 -- bringing the total employer cost to roughly £45,000 or about £22 per hour based on 2,080 working hours annually. Add recruitment costs, sick pay, training, and desk space, and the true cost per hour rises further.
Use the meeting cost calculator to find the real cost of your next team meeting, and the freelance rate calculator to compare with contractor day rates.
Why meetings cost more than they appear
A one-hour meeting with five people earning an average of £40,000 gross costs roughly £110 in salary time alone, or around £130 including employer NI and pension. That is before any preparation time, follow-up, or opportunity cost.
Research from various productivity studies suggests 20 to 40 % of meeting time could be replaced by asynchronous communication without loss of outcome quality. The UK has no specific legal right to refuse meetings outside core hours (unlike France), but flexible working agreements increasingly address this in practice.
Freelancer vs employee: the real hourly comparison
A contractor billing £500 per day appears more expensive than an employee on £40,000 gross (approximately £19 per hour salary). But the employer pays no NI, no pension, no sick pay, and has no notice period or redundancy liability. For a 3-month project, the fully loaded employee cost often exceeds the contractor cost when recruitment, onboarding, and potential notice costs are included.