Security guard bill rate calculator
Work out how much to charge for security guard services from your own costs: the officer's pay, payroll taxes, insurance, overhead and the margin you want. Change any number and the bill rate, the breakdown and the monthly bill for a post update as you type.
Your numbers
- Bill rate per hour
- $31.09
- Loaded cost per hour
- $26.43
- Gross profit per hour
- $4.66
- Markup over pay rate
- 55.45%
- Monthly bill, one 24/7 post (730 hours)
- $22,695.70
- Monthly bill, one 40-hour-a-week post (about 173.3 hours)
- $5,388.93
| Item | How it is worked out | Per hour |
|---|---|---|
| Officer pay rate | Your pay rate | $20.00 |
| Social Security and Medicare (FICA) | $20.00 × 7.65% | $1.53 |
| Federal and state unemployment taxes (FUTA/SUTA) | $20.00 × 3% | $0.60 |
| Workers' compensation | $20.00 × 4% | $0.80 |
| Benefits and paid time off | $20.00 × 0% | $0.00 |
| General liability insurance | Per hour, as entered | $1.50 |
| Uniforms, equipment, training and other overhead | Per hour, as entered | $2.00 |
| Loaded cost per hour | Sum of the lines above | $26.43 |
| Bill rate per hour | $26.43 ÷ (1 − 15%) = $26.43 ÷ 0.85 | $31.09 |
| Gross profit per hour | $31.09 − $26.43 | $4.66 |
| Markup over pay rate | ($31.09 − $20.00) ÷ $20.00 | 55.45% |
In words: the loaded cost is the pay rate of $20.00, plus $20.00 × 14.65% in payroll costs ($2.93), plus $1.50 of liability insurance and $2.00 of overhead, which makes $26.43 an hour. The bill rate is $26.43 divided by (1 − 15%), which is $31.09 an hour. One 24/7 post bills $31.09 × 8,760 hours ÷ 12 months (730 hours) = $22,695.70 a month; a 40-hour-a-week post bills $31.09 × 2,080 hours ÷ 12 months = $5,388.93 a month.
How the bill rate is worked out
- Start with the officer's hourly pay rate.
- Add the payroll costs that follow pay: Social Security and Medicare, unemployment taxes, workers' compensation and benefits. Each is a percentage of the pay rate, so add the percentages and multiply the pay rate by the total.
- Add the costs that do not follow pay, per hour: general liability insurance, and uniforms, equipment, training and other overhead. The sum is the loaded cost of one hour.
- Divide the loaded cost by one minus your target margin. For a 15% margin, divide by 0.85. That is the bill rate, and the margin is then a share of what the client pays, not of your cost.
- Gross profit per hour is the bill rate minus the loaded cost. Markup over pay is how much higher the bill rate is than the pay rate, as a percentage of pay.
- A month is a twelfth of a year: a post staffed 24 hours a day, 7 days a week has 24 × 365 ÷ 12 = 730 hours, and a 40-hour-a-week post has 40 × 52 ÷ 12, about 173.3 hours.
Margin and markup are not the same. Adding 15% to your cost gives a margin of only about 13%; dividing by 0.85 gives a true 15% margin. Quotes go wrong when the two are mixed up.
Each money amount is rounded to the cent. Gross profit, markup and the monthly bills use the rounded bill rate, as a quote or an invoice would.
What to check for your company
The calculator only knows the numbers you give it. Before you quote, check these against your own state, insurer and contracts:
State and local rules
Minimum wages, prevailing wage rules on public contracts, unemployment tax rates and wage bases, licensing fees and paid sick leave laws differ by state and city. Use the figures that apply where the post is.
Overtime
Hours over 40 in a workweek are paid at time and a half under federal law, and some states add daily overtime. A 24/7 post covered by too few officers creates overtime the base rate does not pay for: price it in, or bill it separately.
Holiday pay
If you pay officers a premium on holidays, decide whether the client pays a holiday rate on those days or the cost is spread across the base rate, and write it down.
Contract terms
Say how the rate changes when the minimum wage or a union rate rises, what extra and short-notice hours cost, how unfilled hours are handled, and when invoices are due. A rate that is right today can lose money after the first raise.
Bill from the hours your officers really work
Once the rate is set, it has to reach the invoice. In Guardix each post site carries its own service rates, with an hourly, overtime and holiday rate for every service type, and invoices are built from tracked hours: the officers' clock-in and clock-out times, the published shifts or the contract schedule. Add a payroll burden rate and an overhead basis, and the client and site profitability view shows total cost, gross profit and margin for each client and site, so you can see when a rate has stopped covering its costs.
Book a demoSee it with your own sites and rates.
Frequently asked questions
- How much should I charge for security guard services?
- Charge your loaded cost per hour divided by one minus your target margin. The loaded cost is the officer's pay plus payroll taxes, workers' compensation, benefits, insurance and overhead. With the example values on this page (a $20.00 pay rate, 14.65% in payroll costs, $1.50 of insurance and $2.00 of overhead per hour, and a 15% margin) the cost is $26.43 an hour and the bill rate is $31.09.
- What is the difference between a pay rate and a bill rate?
- The pay rate is what the officer earns per hour. The bill rate is what the client pays per hour for that officer. The difference covers the employer's taxes, insurance, benefits, overhead and profit.
- Is the profit margin the same as markup?
- No. Margin is profit as a share of the bill rate; markup is how much is added on top of a cost. This calculator treats your target as a margin, so it divides the loaded cost by one minus the margin instead of adding a percentage, and it shows the markup over the pay rate separately.
- What FICA rate does an employer pay for a security officer?
- The IRS sets the employer's share at 6.2% for Social Security and 1.45% for Medicare, 7.65% in all. The 6.2% stops once an employee's wages for the year pass the Social Security wage base; Medicare has no wage limit.