The labour bill in a tree service business for 2027

What to take away

This article covers business planning, not employment law, tax or safety instruction. Pay rules, workers' compensation premiums and licensing vary by province, state and municipality, so confirm the current requirements with your provincial labor ministry, workers' compensation board or the relevant wage authority before you set rates.

Start with the wage roll you already have

A 2027 budget is arithmetic on your own numbers, not a survey. Pull last year's payroll register and split every crew hour into four buckets: base wage, overtime, statutory costs and paid time off.

Statutory costs are payroll taxes and workers' compensation premiums. They move with the wage, so a raise costs more than the raise.

Write the budget as named variables you substitute with your own figures: crew hours (H), average base rate (R), overtime hours (O) at the applicable multiplier, premium rate (P) as a percentage of payroll, and payroll tax rate (T).

Your labor line is roughly (H x R) + (O x R x multiplier) + (H x R x (P + T)).

The multiplier, the premium rate and the tax rate are set by your jurisdiction, not by you.

That is why a borrowed benchmark fails. A national average does not know your province, your service mix or your overtime exposure.

Run the arithmetic on an example, then replace every figure with your own. A four-person crew works 8,000 regular hours and 400 overtime hours in the year, at an average base rate of $28 an hour.

Base wage is 8,000 hours x $28, or $224,000. Overtime at 1.5 times the rate adds $16,800. Payroll taxes at 10% of wages add $24,080.

A workers' compensation premium at $6 per $100 of payroll adds $14,448. American tree services typically pay between $3 and $15 per $100, so that figure is an example, not a rate.

The year's labor line comes to about $279,000, or about $33 for each of the 8,400 paid hours in 2026 dollars. For 2027, add the raise you intend to give. A 3.5% raise on this roll adds about $9,800 once taxes and premiums are counted, which puts the 2027 figure near $34.40 for each paid hour.

A two-point move in the premium rate, from $6 to $8 per $100 of payroll, adds about $4,800. The wage rate, the overtime multiplier and the premium rate move the total more than any other input.

What the published figures actually give you

The U.S. Bureau of Labor Statistics: Tree Trimmers and Pruners publishes wage estimates by occupation, industry and geographic area for workers who use climbing, rigging, hand tools, power tools and truck-mounted lifts.

The linked page carries the May 2023 estimates, when the median for occupation code 37-3013 sat near $23.60 an hour, or about $49,000 a year. The most recent release at the time of writing is the May 2024 estimates, published in April 2025, which supersedes those figures.

That release puts the median for the same occupation in the mid-$20s an hour, roughly $50,000 a year. Treat the figure as typical, and use it to sanity-check a range for a role in a given market.

It is a survey of what employers reported, not a forecast for your 2027 offer. Within one market the spread is wide: entry ground work in the high teens, lead climbers in the high 30s.

For employers new to payroll, U.S. Department of Labor: New and Small Businesses sets out duties under federal and state law. These include:

Read it before you write a contract, not after a complaint.

Safety duties that shape what a crew can be asked to do sit with Occupational Safety and Health Administration: Tree Care Industry Standards. Training requirements in that material are a cost line in the budget, because certification hours are paid hours.

Overtime multipliers are set by rule, not by preference. Under the federal Fair Labor Standards Act, covered employees earn 1.5 times their regular rate after 40 hours in a workweek. The regular rate can include nondiscretionary bonuses, so the multiplier applies to more than the base wage.

Some states add daily triggers. California pays 1.5 times after 8 hours in a day and double time after 12. Alaska, Nevada, Colorado and Oregon also run daily overtime rules. Where a state rule and the federal rule both cover the same hours, the employee gets the higher of the two.

The Canadian premium is the number most budgets miss

Workers' compensation in Canada is provincial, and the rate is assigned by industry classification. WSIB in Ontario, WorkSafeBC in British Columbia and Alberta WCB each publish their own rate groups and premium rates.

WSIB's average premium rate has held near $1.30 per $100 of payroll for several years. WorkSafeBC's average base rate has run between roughly $1.55 and $1.80 per $100 of assessable payroll. Alberta's average has sat in the $1.10 to $1.30 band.

Washington levies its state fund premium per hour worked rather than per $100 of payroll, so that figure is not directly comparable with the Canadian rates. Confirm the current published rate with the agency.

The rate group assigned to tree work can sit above or below those averages, so check the group, not the headline rate. Each board reviews an employer's experience rating on its own schedule.

A tree service operating in two provinces carries two premium structures and two sets of reporting duties. The same climber on the same wage costs a different total in Ontario, British Columbia and Alberta.

Budget the premium as a percentage of assessable payroll, confirm the current rate with the board that covers your operation, and re-check it when your experience rating changes.

Federal payroll taxes apply across Canada. Under 2025 Canada Revenue Agency rates, Canada Pension Plan contributions take 5.95% from the employee and 5.95% from the employer on pensionable earnings.

Employment Insurance costs the employer $2.30 per $100 of insurable earnings. Vacation pay runs 4% of wages under five years of service and 6% at five years or more in Ontario, British Columbia and Alberta.

Those are 2025 Canada Revenue Agency figures. Re-check the 2027 rates with the agency before you lock the payroll line for the budget year.

Overtime thresholds are provincial. Ontario pays 1.5 times the rate after 44 hours a week, British Columbia after 8 hours a day or 40 hours a week, and Alberta after 8 hours a day or 44 hours a week. Confirm the current rules with the labor ministry that governs the employment.

Where the hours go, and what they have to earn back

A wage is half the labor bill. The other half is the hours it buys. Track revenue per crew hour and break-even per truck so you can see which roles pay for themselves; the arithmetic is set out in tree service profit margins and break-even points.

At $34.40 a paid hour, a crew that bills 1,400 hours a year while paying for 2,000 carries about $20,600 of wage cost with no invoice behind it.

Storm response is where the budget breaks. Emergency work fills the calendar, overtime climbs, and the premium and tax on those hours land weeks later. Hold a cash reserve sized to one storm cycle, and price emergency work so the overtime is inside the quote, which is the subject of pricing tree service jobs for a fair margin.

Roles to budget separately in 2027

Each role carries a different rate, a different certification cost and a different premium exposure. Budget them as separate lines. Typical U.S. base rates before taxes and premiums, as of 2026:

The 2026 base rates above are a starting point for 2027, not a rate card for it. Re-check them against your own hiring before the budget year starts.

Loaded for 2027, with payroll taxes at 10% of wages, a workers' compensation premium at $6 per $100 of payroll and a 3.5% raise:

Loaded means base rate plus payroll taxes plus the premium plus the raise. Substitute your own rates and your own premium percentage.

In Canada, add the provincial premium and payroll costs on top of those rates. The same role lands at a different total in each province.

Write the role before you write the offer

Define each role's safe scope, duties, equipment authority, and customer communication. Also define documentation, quality checks, decisions, and escalation path. That scorecard is the only honest basis for a rate, and it is where hiring reliable staff for a tree service begins.

For the training side of that same groundwork, 4 things to understand about tree service hiring and training covers what to settle before a new hire's first paid hour.

Show candidates the real job:

A recruiter who sells an easier job than the crew performs has created a resignation with a start date.

For hiring through the Temporary Foreign Worker Program, eligibility and the labour market impact assessment are decided by the federal immigration authority on the facts of the position and the region. Take immigration counsel on the application; do not read eligibility off a competitor's approval.

Common questions

What should a tree service budget for 2027 pay?

Budget base wage, overtime at the applicable multiplier, payroll taxes, workers' compensation premiums and paid time off, using your own crew hours and rates. Load every rate with those costs before you set a price.

The premium and tax rates come from your province or state, so the total differs by location even when the wage is identical.

Why not just use a national average wage?

The May 2024 BLS median sits in the mid-$20s an hour and covers the whole country, from entry ground work in the high teens to lead climbers in the high 30s.

Use published estimates to sanity-check a range, then build the actual line from your payroll register and the rates that apply to your operation.

How do workers' compensation premiums fit the budget?

They are assessed on payroll at a rate set by your provincial board, such as WSIB, WorkSafeBC or Alberta WCB, and adjusted by your experience rating. Ontario's average rate has been about $1.30 per $100 of payroll, with British Columbia higher and Alberta lower.

Treat the premium as a percentage of assessable payroll and re-check it whenever the rating changes.

Where does training cost belong?

In the labor line, because certification and safety training are paid hours. Rigging, climbing and felling at height are taught by a certified arborist trainer under CSA Z133, and the current requirements are set by the authority in your jurisdiction.