Bill Rate
A bill rate is what a staffing agency charges per hour of Crew Member work. How to calculate it from pay rate, burden and markup, with a free calculator.September 24, 2026
6 min read
Invoicing & Billing
Written by the NextCrew team · Reviewed
Definition
A bill rate is the hourly amount a staffing agency charges its client for each hour a Crew Member works. It has to cover three things: the Crew Member's pay rate, the employer costs on top of that pay (the burden), and the agency's gross margin. What is left after pay and burden is what the agency keeps before overhead.
Where bill rate sits in the pricing chain
Staffing bill rate calculator
Enter a pay rate and a markup to get the bill rate, or type in a bill rate a client offered to see the markup it gives you. Add your burden and any program fee to see what the agency keeps per hour.
Your numbers
Per hour
Gross margin after burden and fees
$5.00
17.2% of the bill rate
Spread
$9.00
Margin before burden
31.0%
Burden
$4.00
Program fee
$0.00
PayBurdenFeeGross margin
Estimates only. Burden depends on your state, workers' comp class codes and tax rates. Not tax or accounting advice.
How is a bill rate calculated?
Most agencies calculate a bill rate by applying a markup to the pay rate: bill rate = pay rate × (1 + markup). A $20.00 pay rate with a 45% markup gives a $29.00 bill rate. The markup is not profit. It has to pay for the burden first, and only what remains is margin.
| Illustrative example (made-up numbers) | Per hour |
|---|---|
| Pay rate | $20.00 |
| Markup at 45% | +$9.00 |
| Bill rate | $29.00 |
| Burden at an assumed 20% of pay | −$4.00 |
| Gross margin per hour | $5.00 (about 17% of the bill rate) |
Example only. Your burden depends on the state, the workers' comp class code and your unemployment tax rates.
Burden is the part agencies most often guess. It includes the employer's share of Social Security and Medicare (7.65% of wages under FICA, per the IRS), federal and state unemployment taxes, workers' compensation insurance and any benefits you provide. Some of it is fixed by law; most of it varies by state, role and your own claims history, so it has to be calculated for each client and position rather than assumed.
What is the difference between bill rate and pay rate?
The pay rate is what the Crew Member earns per hour; the bill rate is what the client pays the agency for that same hour. The gap between them is the agency's markup, which covers burden and margin. Put simply, bill rate vs pay rate is the agency's revenue for an hour against its largest cost for that same hour.
| Pay rate | Bill rate | |
|---|---|---|
| Who receives it | The Crew Member | The staffing agency |
| Who pays it | The staffing agency | The client |
| Where it appears | The paycheck | The client invoice |
| What sets it | The local labor market and minimum wage law | Pay rate, burden, markup, and the client's rate card or contract |
Where agencies get bill rates wrong
Most margin problems are priced in on the day the bill rate is set, not discovered later.
- One markup for every client. A warehouse role and an office role carry different workers' comp costs, so the same markup produces very different margins.
- Paying overtime at time and a half but billing it at straight time. If the client agreement does not bill overtime at a premium, every overtime hour eats the margin, and on a busy week it can go negative.
- Pricing on the headline rate in a VMS program. A program fee comes off the bill rate before you are paid, so the rate that matters is the one after the fee. See how VMS and MSP fees affect margin.
- Not re-pricing when costs move. A minimum wage increase, a new unemployment tax rate or a workers' comp renewal changes the cost of every hour, but bill rates only change if someone asks.
- Rates living in a spreadsheet. When the rate on the invoice is typed from a sheet instead of coming from the job, one wrong cell bills a client at last year's rate for months.
How NextCrew handles bill rates
In NextCrew the bill rate travels with the job, so the rate agreed with the client is the rate that reaches the invoice.
- Default pay and bill rates by position, with a job-level override when one Crew Member on a job needs a different rate, without changing anyone else's.
- Pay and bill rates fill in on every timesheet from the job and Crew setup, and every manual rate change is recorded: who changed it, to what, and when.
- Pay codes carry their own bill rates. Regular, overtime, holiday, bonus and reimbursement each have their own billing and overtime rules, and a holiday schedule set company-wide, with client overrides, drives both pay and bill.
- Approved hours become the invoice, with each timesheet marked as invoiced so the same hours cannot be billed twice.
NextCrew calculates using the rates and rules your agency configures. See how it fits together in invoicing software for staffing agencies.
Frequently asked questions
Related terms
- Pay rate: what the Crew Member earns per hour.
- Markup: the percentage added to the pay rate to reach the bill rate.
- Burden rate: the employer costs on top of wages, as a share of pay.
- Gross margin: what is left of the bill rate after pay and burden.
- Consolidated invoice: billing a multi-site client on one invoice.