What your labour rate has to pay for
Every hour of labour you sell has to pay for four things:
- The technician who did the work, with employer's National Insurance, pension and insurance.
- The hours you pay that technician for but can't sell: holiday, sick days, waiting on parts and authorisation, cleaning down, training and rework.
- A share of everything else the bodyshop costs: rent and business rates, the office, equipment, insurance, software.
- Your profit.
Parts, paint and materials, and sublet work earn gross profit too, and pay part of the overheads. The rest falls on labour. The four steps below work it out for an example bodyshop with 4 body technicians. Put your own figures in at each step.
Step 1: What a technician really costs
Start with what one technician costs you in a year. Our example pays £17.82 an hour, the April 2026 median for vehicle body repairers (ONS, provisional). The middle half earned £15.51 to £19.94 an hour; paint technicians' median was £18.02.
| Cost | A year |
|---|---|
| Pay: £17.82 × 2,080 hours, holiday included | £37,065.60 |
| Employer's National Insurance (15% above £5,000) | £4,809.84 |
| Pension (3% of pay between £6,240 and £50,270) | £924.77 |
| Employers' liability insurance, one technician's share | £350.00 |
| Total | £43,150.21 |
On-costs add 16% to the pay here: £20.75 for every hour paid. The £350 for employers' liability is made up for the example: get a quote.
The Employment Allowance takes up to £10,500 a year off your employer's National Insurance bill, enough to cover about two technicians like this one. It's a fixed sum for the whole business, so the example leaves it out of the technician's cost; if you can claim it, it's worth £1.93 for every hour this bodyshop sells. A company whose only employee is its sole director can't claim it. Add anything else you pay as well: bonuses, overtime, tool allowances, workwear.
Step 2: The hours you can sell
You pay for 2,080 hours a year, but a technician can't sell all of them. Take off the days they're paid but not at work, then the hours at work that don't go on a paying job:
| Hours | |
|---|---|
| Hours paid: 40 a week for 52 weeks | 2,080 |
| Less 28 days' holiday, bank holidays included, and 5 sick days | -264 |
| Hours at work | 1,816 |
| Less the 25% not on paying jobs: waiting, cleaning down, training, rework | -454 |
| Hours sold | 1,362 |
Holiday is the legal minimum: 5.6 weeks, capped at 28 days for a five-day week. The sick days and the 75% are made up for the example: use the hours on your job cards against the hours you paid.
Our example pays full pay for sick days. The legal minimum is Statutory Sick Pay: from 6 April 2026, £123.25 a week or 80% of average weekly earnings, whichever is lower, from the first day off. Northern Ireland has its own employment law, so check the rules there.
The pay
£17.82 an hour
What the technician earns.
Cost per hour paid
£20.75
With National Insurance, pension and insurance.
Cost per hour sold
£31.68
78% more than the pay, once the unsold hours are counted.
That last figure is what each hour of labour on a quote costs you before a penny of rent is paid.
Step 3: Spread your overheads
Now add up everything else the bodyshop costs in a month. Our example's overheads, all made up:
| Overhead | A month |
|---|---|
| Rent: a 5,000 sq ft industrial unit | £4,000 |
| Business rates | £1,200 |
| Electricity, gas and water: the booth burns a lot of it | £1,400 |
| An estimator who also runs the office, with NI and pension | £3,300 |
| A manager's salary, or your own if you run the bodyshop | £3,500 |
| Insurance: motor trade combined, premises and public liability | £900 |
| Equipment finance and servicing: booth, jig, welders, lifts | £1,800 |
| Estimating system, software, phones and internet | £600 |
| Accountant, bank and card fees | £400 |
| Training and accreditation | £300 |
| Waste, protective gear and consumables you don't charge to jobs | £700 |
| Total | £18,100 |
That's £217,200 a year. Spread over the 5,448 hours the 4 technicians sell, it's £39.87 an hour.
Labour doesn't carry all of it. The gross profit on parts, paint and materials, and sublet pays a share; in this example, 40%. That leaves labour £23.92 an hour. To find your own share, take last year's gross profit on parts, paint and sublet and divide it by your overheads.
Technician cost
£31.68
Per hour sold, from step 2.
Labour's share of overheads
£23.92
Per hour sold, after parts and paint pay their share.
Break-even rate
£55.60
Every hour sold below this loses money.
Step 4: Add your profit
To make a 10% profit on every hour you sell, divide the break-even rate by 0.9: £55.60 ÷ 0.9 = £61.78 an hour, before VAT.
If labour had to carry every pound of overhead, with no help from parts and paint, the same bodyshop would need £79.50 an hour. That's why the margins on parts and paint matter so much to a labour rate: our guide to bodyshop profit margins covers them.
What moves your rate
The same bodyshop, changing one thing at a time:
| Change | Break-even | With 10% profit |
|---|---|---|
| Quieter: 65% of hours at work sold | £64.18 | £71.31 |
| The example: 75% of hours at work sold | £55.60 | £61.78 |
| Busier: 85% of hours at work sold | £49.05 | £54.50 |
| Technicians paid £19.94 an hour (the 75th percentile) | £59.42 | £66.02 |
| A fifth technician, with the same overheads | £50.81 | £56.46 |
Selling more of the hours you already pay for moves the rate most, because the technician's cost and the overheads are spread over more hours. That's the case for ordering parts early, chasing authorisation and keeping cars moving, and for recording the hours on every job card: our job costing guide shows how.
What UK bodyshops actually get
There's no official UK labour rate. The best figure is the ABP Club's yearly survey of repairers: 274 businesses took part in the 2025 report, including many of the largest groups. It asks for each bodyshop's average net hourly rate across all its work, insurer and retail together.
Average net rate, 2025
£48.23
Down 4.7% from £50.62 in 2024.
What repairers call fair
£61.41
Their own estimate, down from £64.06.
Shops under £50 an hour
63%
And 44% under £45.
| Rate per hour | Share of bodyshops |
|---|---|
| Under £35 | 0% |
| £35 to £39.99 | 14% |
| £40 to £44.99 | 30% |
| £45 to £49.99 | 19% |
| £50 to £54.99 | 15% |
| £55 to £59.99 | 7% |
| £60 to £64.99 | 7% |
| £65 to £69.99 | 4% |
| £70 or more | 4% |
ABP Club State of the Industry Report 2025, page 20. Self-reported; the sample leans towards larger businesses.
| Year | Average net rate | Fair rate |
|---|---|---|
| 2018 | £32.75 | £42.26 |
| 2019 | £34.43 | £44.45 |
| 2020 | £34.81 | £44.14 |
| 2021 | £36.02 | £47.57 |
| 2022 | £40.85 | £53.28 |
| 2023 | £46.80 | £59.11 |
| 2024 | £50.62 | £64.06 |
| 2025 | £48.23 | £61.41 |
ABP Club State of the Industry Reports 2024 and 2025.
Our example bodyshop needs £61.78, close to the fair rate, and at the £48.23 average it would lose money on every hour it sells. That gap is why repairers ranked low labour rates the biggest threat to their business in 2025: 28% called them a huge threat and 35% a significant one.
Retail rates, garage labour rates and insurers
Insurers' figures tell the same story from the other side. The FCA's review of motor claims found the average labour rate on eight insurers' own customers' repairs rose from £35 an hour in 2019 to £45 in 2023. Hours per repair went from 17.6 to 19.4, and labour cost per repair from £616 to £879.
Retail rates, for customers paying their own bills, are another matter: we found no published survey of bodyshop retail rates. The nearest is garage labour rates for mechanical servicing, where What Car?'s 2023 survey of 279 independent garages found an average of £76 an hour, from £47 in Huddersfield to £141 in south-west London. Servicing isn't body work, but it shows how far retail rates can sit above what insurance work pays.
- Set your retail rate from your own costs, not from what insurers pay you.
- Show the rate on every quote, so retail customers know what they're paying for before the work starts.
- For insurance and accident management work, the rate is in your agreement with each work provider. Read what it allows for paint, materials and parts discounts as well.
Our guide to becoming an approved repairer covers how insurers' networks set the rates they pay.
Flat-rate and bonus pay, and the minimum wage
Some bodyshops pay technicians a bonus on the hours they produce, or on the hours on the quote rather than the hours they work. We found no published survey of how UK bodyshops run these schemes. However you do it, the minimum wage still applies: £12.71 an hour at 21 and over from 1 April 2026, £10.85 at 18 to 20, and £8.00 under 18 and for apprentices in their first year or under 19.
A bonus scheme changes step 1. Your labour cost moves with the hours produced rather than the hours worked, but the bay is still held for as long as the job takes. Regular overtime and pay linked to the work also count towards holiday pay for 4 of the 5.6 weeks.
Raising your rate
- Work your rate out again at least once a year, and after every April, when the minimum wage, National Insurance and Statutory Sick Pay change.
- Price new equipment in. A £13,899 screw compressor (one supplier's price before VAT) paid off over 5 years adds £0.51 to every hour our example bodyshop sells. A booth, a jig and calibration kit add far more.
- Set separate rates where the work differs: panel, paint, mechanical and electrical, ADAS.
- Show your rates on every quote, so customers and insurers know them before the work starts.
- Send your new rate to every work provider, with the costs behind it, before their agreements come up for renewal.
