Security guard
bill rate calculator
The number that decides whether a guarding contract makes money is not the officer’s pay rate. It is everything sitting between that pay rate and the invoice. This builds the hourly bill rate from the bottom up, one layer at a time, using your numbers. Nothing is prefilled with an industry average on purpose: burden and differentials vary by jurisdiction and by contract, and a made-up average looks far too much like a fact.
Run your numbers
Type your own figures. Nothing is sent to a server: the arithmetic runs in your browser, and reloading the page clears every field.
What the officer earns for a straight-time hour, before differentials and before employer taxes. If you run salaried posts, divide the annual salary by the straight-time hours in your standard year.
How much the base pay rate rises, on average, for overtime, night, weekend and holiday hours at this post. Take it from your own payroll: last year’s premium pay divided by last year’s straight-time pay. A weekday day post may be near zero; a 24/7 post is not.
Everything you pay on top of wages because the officer is on payroll: employer payroll taxes, unemployment and workers’ comp, health benefits, paid time off and any statutory contributions where you operate. Do not guess it — your accountant already calculates it, and it varies by state and by class code.
Annual spend per officer on uniforms, boots, radio, flashlight, vest, licensing, background checks and training. Enter the yearly figure; it gets prorated to the hour below.
Used to spread the equipment cost across the hours each person produces. A 40-hour week is 2,080 hours a year. Use your real schedule, not the example.
The share of the hours you pay for that is not standing on the post: paid time off, sick days, no-shows, training, and the gap between a resignation and a replacement. Pull it from your history — paid hours for the year divided by hours actually covered, minus one.
Field supervisors, the patrol vehicle, dispatch, the office, insurance, accounting and payroll, expressed as a percentage of direct labor cost. Work it out once a year: annual overhead divided by annual direct labor across all posts.
The margin you want on the bill rate — not the markup you add to cost. They are different numbers and the difference is explained below. Must be under 100.
Post coverage
This part is plain division and rests on no market assumption at all.
A 24/7 post is 168. A 12-hour post, Monday to Saturday, is 72.
The straight-time week before overtime starts: usually 40 hours.
Enter at least the base pay rate and press Calculate the bill rate. If your browser does not run JavaScript the widget will not work, but the method, the written formula and a fully worked example are below and can be reproduced in a spreadsheet in five minutes.
The seven layers of a bill rate
A guarding rate is built from the bottom up, and the order matters, because each layer applies to the result of the one below it. Applying burden to the base pay rate before adding differentials leaves out the employer taxes on those premium hours, which you pay anyway. Here are the layers in order.
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1. Base pay rate
The starting point, and the only layer almost nobody forgets. Divide salaried posts by straight-time hours, not by hours actually worked: the extra hours are premium pay and they belong in the next layer.
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2. Overtime and shift differentials
Overtime, nights, weekends and holidays. A weekday lobby post barely has them; a 24/7 post carries them across a third of its hours, and that third gets invoiced at the same rate as everything else if the rate was priced off a day shift. Take the percentage from last year’s payroll rather than from an industry figure.
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3. Labor burden
Employer payroll taxes, unemployment insurance, workers’ compensation, benefits and paid time off, applied to pay with differentials already included. This is the layer that varies most between jurisdictions, which is exactly why the field is empty: the right number is the one your accountant produces every month, and workers’ compensation alone moves it by several points depending on the class code.
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4. Uniforms, equipment and gear
Uniforms, boots, vests, radios, flashlights, licence renewals, background checks and training. It is paid per person per year, so getting it to an hourly figure means dividing by the hours that person works in a year. Small per hour and large in the annual total, which is precisely the profile of the costs that get left out.
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5. Relief and coverage allowance
The client pays for hours when somebody is standing on the post. You also pay for paid time off, sick days, training, no-shows and the stretch between a resignation and a replacement. That gap between hours paid and hours billed is a multiplier on everything above it, and it comes out of your own history rather than a benchmark.
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6. Supervision and overhead
The field supervisor, the vehicle, fuel, dispatch, the office, general liability insurance, accounting and payroll. None of it is invoiced separately and all of it exists. The workable way to carry it is as a percentage of direct labor: annual overhead divided by annual direct labor across every post, calculated once a year.
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7. Margin
What is left for the company. It goes last, and it is calculated by dividing rather than adding, for the reason set out further down.
The formula, written out
This is what the widget runs. It fits in a spreadsheet, and you do not need the calculator to use it.
Percentages go in as decimals: 50 percent is 0.50. The relief allowance multiplies the equipment line too, and that is deliberate — uniforms are bought per person, so if you need more people than you bill hours for, every billed hour carries slightly more uniform.
A worked example
The figures below are invented so the arithmetic is visible. They are not an industry average, not a benchmark and not a starting point — replace them with yours. A 24/7 post: base pay rate 10 per hour, differentials 10 percent, burden 50 percent, equipment 1,040 a year over 2,080 hours, relief 10 percent, overhead 10 percent and a 20 percent margin on the sell.
| Step | Arithmetic | Per hour |
|---|---|---|
| Base pay rate | — | 10.00 |
| + differentials | 10.00 × 1.10 | 11.00 |
| + labor burden | 11.00 × 1.50 | 16.50 |
| + prorated equipment | 1,040 / 2,080 | 17.00 |
| × relief allowance | 17.00 × 1.10 | 18.70 |
| × supervision and overhead | 18.70 × 1.10 | 20.57 |
| = bill rate | 20.57 / 0.80 | 25.71 |
| Gross profit per hour | 25.71 − 20.57 | 5.14 |
The post bills 728 hours a month (168 hours times 52 weeks, divided by 12), so at 25.71 an hour that is 18,718.70 a month. The spread between bill rate and pay rate is 15.71 an hour, more than the pay rate itself. Anyone negotiating off the pay rate alone reads that spread as profit, and that is where rates that do not cover their own cost come from.
Why a 24/7 post is 4.2 officers, not 4
This is not a statistic; it is division. A week has 168 hours and all of them need covering. One officer on a 40-hour week covers 40. One hundred and sixty-eight divided by forty is 4.2. That result is the absolute floor: the number of positions you need if nobody is ever sick, nobody takes a day off and nobody quits.
A company that staffs a 24/7 post with four officers has not saved a headcount. It has covered 160 of the 168 hours and is paying the remaining eight as overtime, at premium, every week of the year. That is why the 4.2 does not raise the cost of a billed hour — you still bill 168 — but it does decide the schedule: either you staff the fractional position or you pay the premium. The relief allowance is what stacks on top of the 4.2 for time off, absence and turnover, and that one does raise the hourly cost, because those are hours you pay for and cannot invoice.
Markup is not margin, and the gap is the contract
A cost of 20 an hour with a 25 percent markup gives a bill rate of 25 and a profit of 5 on a sale of 25: a margin of 20 percent, not 25. To actually earn 25 percent you divide 20 by 0.75, which is 26.67. The difference is 1.67 an hour, and a 24/7 post bills 8,736 hours a year, so that is about 1,213 a month and close to 14,560 a year. Multiply by the number of posts you run.
It fails quietly: the rate comes out, the client signs, the margin shows up in the budget, and only at year end does somebody notice that realised profit is consistently below the planned figure. This calculator divides, which is why the field is labelled margin on the sell. If you prefer to price by markup, the conversion is direct: a 25 percent markup is a 20 percent margin.
Frequently asked questions
What is a bill rate for a security post?
The hourly price you charge the client for keeping someone on that post. It is not the officer’s pay rate and it is not the pay rate plus a percentage: it is pay rate plus shift differentials plus labor burden plus prorated equipment plus the relief allowance plus overhead, and margin applied on top of that total. Every layer you leave out comes straight out of the margin.
Why are the percentage fields empty instead of prefilled?
Because there is no labor burden percentage that is true in Texas, California, Ontario and the United Kingdom at the same time, and no differential percentage that is true for both a weekday lobby post and an overnight industrial post. A prefilled average would look like a data point without being one. The numbers this asks for are the ones your payroll and your accountant already produce.
What is the difference between bill rate, pay rate and spread?
Pay rate is what the officer earns per hour. Bill rate is what the client is invoiced per hour. The spread is the difference between the two, and it is the number people misread most often, because it looks like profit and it is not: burden, differentials, equipment, relief coverage and overhead all live inside the spread before a single dollar of margin does.
Do I really need 4.2 officers for a 24/7 post?
At minimum, and it is division rather than a statistic: a week has 168 hours, one 40-hour position covers 40, and 168 divided by 40 is 4.2. That figure is the floor, before any paid time off, absence or turnover. Staffing a 24/7 post with four people does not save a headcount; it converts eight hours a week into overtime, every week of the year.
Is a 20 percent margin the same as adding 20 percent to cost?
No, and this is the most expensive mistake on the list. Adding 20 percent to cost leaves a real margin of 16.7 percent on the sell. To actually earn 20 percent you divide the cost by 0.80. This calculator divides, which is why the field asks for margin on the sell rather than markup on cost.
Does anything I type get stored or sent anywhere?
No. The calculator is a script on this page. There is no form to submit, no server to reach and nothing leaves your browser. Reload the page and the fields are empty again.
Can I use this to check a contract that is already signed?
You can use it to see what the post actually costs, which is the step that comes first. Most guarding contracts carry an escalation clause tied to minimum wage or an inflation index; running the numbers here tells you whether that escalator keeps pace with what the post costs you, or whether every renewal leaves you slightly worse off.
Every input here is an hour somebody has to count
Differentials, relief coverage and the overtime an uncovered post generates are not assumptions — they are recorded hours. In CGuardPro every scheduled shift, relief and clock event lands in the system, and straight-time, night and overtime hours come back out of it by post and by client. That is what you feed into this calculation next month.