Tennessee Labor Burden Calculator

Calculating the fully burdened labor rate in Tennessee starts with federal payroll taxes and adds the state-specific pieces. No state income tax and a low SUI wage base. This calculator pre-fills Tennessee's estimated new-employer SUI rate of 2.7% on a $7,000 wage base, then lets you layer in workers compensation, benefits, and overhead.

Tennessee's estimated new-employer SUI rate of 2.7% on a $7,000 wage base caps state unemployment at $189 per employee per year, below the typical range of $219 to $434 and the 42nd highest of the 51 jurisdictions on this site. At a $30 pay rate the wage base is met in week 6, and SUI stops accruing for the rest of the year. Tennessee has no state income tax on wages, so the employee keeps more of the same pay rate. For a staffing agency billing in Tennessee, state costs are light on both sides: SUI is small and the worker keeps more of the wage. Placements here often carry a lower burden than the national default, so use the actual figure rather than the 18% many agencies assume.

The result is the true hourly and annual cost of an employee in Tennessee: the number you need before setting a bill rate or comparing a W2 hire against a 1099 contractor.