Cost of staff in relation to fees earned

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I am in Practice on my own and have had someone assisting me for a year and a half now who is studying for AAT.  At first on a part time basis but now it is creeping towards full time. I would be interested to know what sort of return I should be getting eg. how much fee income I should be expecting this assistant to be generating in relation to what I am paying.  I am really working on the dark on this but as I am increasing the workload I really need to know what the charge out rate should be in relation to hourly pay.  Is there some kind of standard?

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paddle steamer
By DJKL
04th Nov 2017 21:28

I would say charge out at 3 or 4 times hourly cost.

I suspect which you would use will depend on chargeable time, as a trainee I could (ignoring study leave) get to circa 35 chargeable hours a week out of 37.5 worked, by the time I left full time practice I could struggle to get much more than 25 chargeable out of basic 37.5 hours, hence daft amounts of unpaid overtime to make things more respectable- good reason for leaving, I at least know who my kids are, if I had stayed in practice not so sure this would be true.

Hourly cost will be something like (total salary +NIER+Pension cost+BIK costs)/( (52xsay 37.5 re total)-(28x 7.5 re hols)) If study leave also take hours away from total possible worked.

Beware that if trainee makes a lot of mistakes and you have heavy hours re review/correction you may well, when billing client, need to discount (write off) some off trainee hours (The nasty bit where you needed to explain to the partner why your recovery rates were not up to snuff though I expect no one else's were either)

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By andy.partridge
04th Nov 2017 19:44

I agree, it has got to be 3 x cost plus for it to be working for you. If can be frightening how your personal efficiency gets compromised when acting in a supervisory capacity.

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