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Using the Margin Calculator
Using the Margin Calculator

How to use the Margin Calculator

Written by Jackie Read
Updated over a week ago

The Margin Calculator is available from the Jobs menu and the 'Shortcut Icons' and Activities menu of a Temp or Contract Job record:

It is designed to help you understand how much each Temp or Contract assignment will cost and allows you to add a margin % or mark-up to work out what you should charge your Clients.

Note: When the Margin Calculator is launched from the shortcut icon or activities menu of a Contract Job, the Mode will be pre-populated with Non-PAYE by default. This allows Contract Jobs to be calculated as Non-PAYE by default and removes the need for the user to update both margin fields to get the correct calculation.
For Temp Jobs, the Mode will be pre-populated with PAYE by default.

Explanation of Terms for Basic Input Fields:

  • Pay rate = Candidate pay rate.

  • Multiplier = A figure to multiply the Pay Rate by.

  • Margin = The figure of profit (in terms of percentage or mark-up) you want to make on the pay rate. This must be used in conjunction with the Margin Basis. Users can select either Percent or Markup from the margin basis. Margin Percent is the percentage of the Bill Rate that is profit. When calculated it is added to the cost rate to make the Bill Rate. The Markup value is just added to the Cost Rate to make the Bill Rate.

  • Margin Value = This is the result of the Margin calculation.

Explanation of Terms for Advanced Input Fields

  • Mode = Choose PAYE or Non-PAYE. PAYE will use NI/PRSI %, Holiday Pay % and Pension Contribution %, Non-PAYE won't use these fields in calculation

  • NI/PRSI % = National Insurance/Pay Related Social Insurance. Currently set as 13.8% for PAYE Candidates.

  • Holiday pay % = Currently set as 12.07% for PAYE Candidates.

  • Pension Contribution % = Currently set as 1%

Note: The default figures for the advanced input fields can all be changed in the Application Settings page of the Adapt Manager Profile. Please contact your Erecruit Representative if you don't have access.

Calculation figures

Cost Rate = This is the calculated total cost to the agency for the Candidate. It is the sum of:

  • Pay Rate plus the calculated figures for NI/PRSI, Holiday Pay and Pension Contribution or: 

10 + 1.55 + 1.21 + 0.1 = 12.86

(Note: NI/PRSI is set as 13.8 and Holiday pay as 12.07 in the administrator profile. Hourly rates are therefore; Holiday = 10 * 12.07% = 1.21, NI/PRSI = (10 + 1.21) = 11.21 * 13.8% = 1.5469)

Bill Rate – This is your charge to the Client. It uses the calculation as above plus your Margin Value or:

(10 + 1.55 + 1.21 + 0.1 = 12.86) + 1.43 = 14.29

Using the Margin Calculator

The NI/PRSI % , Holiday Pay % and Pension Contribution % are pre-populated for any PAYE Temp or Contract Candidate. 

For PAYE, input the Pay Rate and the Cost Rate will be calculated using Pay Rate + NI/PRSI + Holiday Pay + Pension Contribution.

Input figures into the Pay Rate, the Margin and the Margin Basis to calculate the Margin Value, the Bill Rate and the Cost Rate,

Input figures into the Bill Rate, Pay Rate, Margin and Margin Basis to calculate the Margin Value.

Add in the Margin % you want to make on a Candidate (in this example we use 10%), and the Bill Rate will be calculated:

10 + 1.55 + 1.21 = 12.76 + (10*1% = 0.1) = 12.86

Check 10% of Bill Rate:
12.86 / 0.9 = 14.29

Note:  Margin Value = Bill Rate – Cost Rate

Price locks

The Margin Calculator has 3 fields marked with a lock icon (all are unlocked by default):

  • Pay Rate

  • Margin

  • Bill Rate

Clicking the 'unlocked' icon changes the field to a 'locked' state.

Locking a field means ‘this value is constant now’, and subsequently any updating of non-locked fields will lead to the other fields being re-calculated based on the locked value and the newly updated field.

Note: It is only possible to lock one field at a time. Locking a field will automatically unlock the previous locked field.

Last Valid Data feature

While using the Margin Calculator, it is possible to end up with a calculated negative value (for example, a negative Margin Value could be calculated if the Bill Rate is set too low). The calculator will mark negative 'invalid' fields with a minus.

In this example, the Pay Rate and Margin Percent have been set to 10 and the margin calculator has calculated valid results:

If the Bill Rate is subsequently set to 12, a negative Margin Value will be calculated:

When a user has negative results they can choose to: 

  • Click the Reset button to clear all the fields, although any data already calculated will be lost. 

  • Manually change each invalid value to valid one, which in turn will re-calculate connected fields.

  • Click the new Last Valid Data button. This will perform an ‘Undo’ operation and return the last valid snapshot of calculated data and the associated chart. Note: This field is inactive by default. It only becomes active after the first valid data calculation is performed.

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