Cost elements for labor / worker
Two types of labour are accounted for labor cost
Direct - Could be traced and can be linked to a specific job for a specific product .
Indirect - It could not be associated with any specific product
Elements for cost of labour
- Salary or wages
- Workers / Employees taxes
- Employer taxes and fringe benefits
- Shift premiums
- Overtime
- Idle time
- Incentive plans
Cost of labour turnover
Preventive cost
The cost companies pays to retain worker/ employees from leaving are mentioned below
- Medical and housing facility
- Benefit like pension gratuity and bonus
- Educational facility for employees children
- Good working condition
- Welfare schemes
Replacement cost
- Cost of hiring
- Cost of training
- Cost of wastages
- Cost of defectives
More on Manufacturing Costing
Product Costing
Material Cost
Labor Cost
Factory Overhead Cost
Cost of Labour
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