Hourly cost of a QA engineer

The hourly cost of a QA engineer on this site is the fully loaded annual cost divided by productive hours. Productive hours start from the formula default of 1,700 a year and are adjusted for statutory paid leave and public holidays in each country. The figure is on the same basis as a contractor or vendor hourly rate.

Two hourly figures

There are two ways to divide an annual figure into hours, and they answer different questions.

Salary per paid hour. Base salary divided by the paid hours in a standard full-time year. This is the hourly pay rate. It includes paid leave and holidays as hours, because the salary pays for them.

Fully loaded cost per productive hour. Total annual cost divided by productive hours. This is the cost to the employer of each hour of work actually done. It is the figure that compares with a contractor rate, because a contractor bills only for hours worked.

The second figure is higher than the first for two reasons: the numerator adds every cost line on top of salary, and the denominator removes leave and holidays.

Worked example

How productive hours are adjusted

The formula file sets the 1,700-hour default without saying how many days of leave it allows for. This site reads the 1,700-hour year as allowing for 30 days a year of statutory leave and public holidays combined (see the formula page). For each country, the calculation takes the statutory minimum annual leave and the number of public holidays from the country record. It subtracts 8 hours for each day above 30, or adds 8 hours for each day below. Public holidays that the statute lets an employer count inside the leave entitlement add no days, as in the United Kingdom. A public holiday that always falls on a weekend removes no working day and is not counted, as with Easter Sunday in Portugal. The adjusted figure for the example country is shown in the worked example above.

Statutory minimum leave is used, not the leave an employer may grant on top. Where an employer grants more leave, productive hours are fewer and the true hourly cost is higher.

What productive hours do not remove

The adjustment removes statutory leave and holidays. It does not remove:

• sick leave;
• parental leave;
• training days;
• time spent in meetings or on non-testing work.

These vary by employer and person and are not sourced at the two-source standard.

Comparing with contractor and vendor rates

The contractor model on this site multiplies the contractor hourly rate by the same productive hours, so the two figures are on the same basis. The outsourced model multiplies the vendor hourly rate by billable hours per month from sources, times 12. A vendor's billable hours can differ from an employee's productive hours, so the annual totals on the compare page are a closer comparison than the hourly rates alone. The contractor vs employee guide works through that comparison.

Monthly cost

The monthly figure on each breakdown page is the annual total divided by 12. It does not depend on hours.

Related pages

• Formula
• Contractor model
• Outsourced model
• Compare
• QA contractor vs employee cost