Burden Rate
Finance
Burden Rate
Rate used to add indirect labor, overhead or other burden costs to a direct cost base.
Examples
- 01The plant applies a burden rate of EUR 38 per direct labour hour to cover supervision, building and support costs.
- 02In the review, the controller shows that the burden rate rose because indirect staff grew while direct hours fell.
- 03When automation cuts direct labour hours, the burden rate is recalculated to avoid underpricing products in quotations.