Virtual Assistant vs Employee: The Employer Costs a Salary Leaves Out

Quick answer: A virtual assistant usually costs less than a local employee, but a fair comparison doesn't stop at the VA's monthly price and a salary. An employee also brings employer payroll taxes, benefits, paid leave, unemployment insurance, workers' compensation, and recruiting costs. In June 2026, benefits made up 30.0% of private-sector compensation, per the BLS. Through Stellar Staff, a full-time VA is $1,999 a month on the Pro plan, with recruiting, payroll, and HR handled. On-site and licensed work still calls for an employee.

Is a Virtual Assistant Cheaper Than Hiring an Employee?

For most office roles, yes. A full-time virtual assistant hired through an agency usually costs less than a local employee doing the same desk work, and Stellar Staff puts its Pro plan at a third of the cost of a local hire. The trouble is that most owners put a VA's monthly invoice next to an hourly wage and stop there. A wage is only one line of what an employee costs. On top of it come the employer's share of Social Security and Medicare, federal and state unemployment taxes, workers' compensation, any benefits you offer, paid time off, and the cost of recruiting and replacing people. An agency's monthly fee covers the recruiting, payroll, and HR services included in its plan. A fair virtual assistant vs employee cost comparison uses the same categories on both sides, rather than comparing a monthly fee with wages alone. This guide lists each line with a published figure, then covers the questions money doesn't settle, such as on-site work and licensed tasks.

In our sales calls, owners who have run payroll before raise taxes and insurance on their own, while first-time employers tend to compare the VA price with a posted wage. For VA price ranges by hiring model, see our virtual assistant cost guide.

What Does an Employee Really Cost Beyond the Hourly Wage?

The true cost of an employee is the wage plus everything the employer pays because that person is on payroll. The Bureau of Labor Statistics measures this in its Employer Costs for Employee Compensation (ECEC) survey. In the release for June 2026, published September 9, 2026, private employers paid an average of $32.82 per hour worked in wages and salaries and $14.07 in benefits, and benefits made up 30.0% of total compensation. For office and administrative support jobs, the closest match to most VA roles, wages were $25.22 per hour worked and benefits were $11.51, or 31.3% of compensation. These are national averages, so your numbers will differ. They still show which lines belong in the comparison. The table lists each one as BLS publishes it, with percentages showing each line's share of total compensation.

ECEC figures are averages per hour actually worked. The BLS Occupational Outlook Handbook reports pay differently: the median wage for secretaries and administrative assistants was $48,310 a year, or $23.23 an hour, in May 2025, and executive administrative assistants earned a median of $76,590. Use whichever fits the role. Our guide to executive vs administrative assistants explains the two jobs.

The last two rows have no government average, so price them from your own records. Any employee cost calculator you find online needs the same inputs and can't fill in those rows for you.

Which Payroll Taxes Does an Employer Pay on Top of Wages?

Every U.S. employer pays taxes that never show up in the employee's offer letter. For 2026, the employer pays 6.2% Social Security tax on each employee's wages up to $184,500 and 1.45% Medicare tax, matching what is withheld from the employee's paycheck, according to the IRS. The Social Security wage base rises to $192,300 for 2027, per the Social Security Administration, and Medicare tax has no wage cap. Federal unemployment tax (FUTA) is 6.0% of the first $7,000 paid to each employee in a year. Employers that pay state unemployment tax on time can take a credit of up to 5.4%, which the Department of Labor says generally leaves a net rate of 0.6%, for a maximum FUTA tax of $42.00 per employee, per year. State unemployment tax rates are set by each state's law, and workers' compensation runs through your state's system.

• Medicare above $200,000. Employers withhold a 0.9% Additional Medicare Tax on wages above $200,000, but the IRS says there is no employer match for it.
• When FUTA starts. Employers generally owe it once they pay $1,500 or more in wages in a calendar quarter, or have an employee on at least one day in each of 20 weeks in a year, per the DOL. It's reported on Form 940.
• State unemployment and workers' compensation. Rates and wage bases vary by state. The DOL directs private companies to their state workers' compensation board. In the ECEC data, workers' compensation averaged $0.43 per hour worked across private industry.

This section is general information, not tax advice. Confirm the rates and filings for your state with your CPA or payroll provider.

What Does It Cost to Recruit and Replace an Employee?

Hiring has its own price before the first paycheck goes out. SHRM's 2025 Recruiting Benchmarking Report, based on a survey of 2,371 members, puts the median cost-per-hire at $1,200 for nonexecutive roles and $10,625 for executive roles. The same report puts the median time-to-fill at about a month and a half for both. Neither figure counts what happens to the work while the seat is empty, or the weeks a new person needs to learn your systems and clients. And if the hire doesn't work out, you pay most of those costs again. That repeat cost is the line owners leave out most often, because it doesn't show up on any budget until someone quits or has to be let go.

Owners in our sales calls describe the same patterns: an employee who keeps calling out, a resignation right before the busy season, or a hire who isn't working out and who they're nervous about letting go. At Stellar Staff, replacements are free, forever, on managed plans, so a bad fit means a new search run by the agency rather than a job post written by you.

How Should You Compare a VA's Hourly Price With Local Pay?

Start with the right benchmark. A full-time Pro VA through Stellar Staff works out to about $12.50 an hour, at $1,999 a month for 160 hours. That figure is the price of the whole arrangement: finding and vetting the person, running payroll, handling HR, tracking hours, and replacing the assistant if needed. A local wage covers only the first line of an employee's cost. BLS data for June 2026 shows wages alone for private-sector office and administrative support jobs at $25.22 per hour worked, before $11.51 in benefits. So compare the VA's hourly price with what local office staff actually earn plus the lines in the first table, not with the wage alone. Some owners use minimum wage as the yardstick instead. The federal minimum is $7.25 an hour, and many states set a higher one: the Department of Labor lists California's at $16.90. Minimum wage is the least an employer may pay before taxes, benefits, or hiring costs, and even a minimum-wage employee brings every line in the first table.

Who Pays What With an Employee, an Agency VA, or a Freelance VA?

The three options split employer duties very differently. With a W-2 employee, you handle the employer's responsibilities. With a VA placed by an agency, the agency recruits, pays, and replaces the person, and you direct the work. With a freelance VA you hire yourself, you take on recruiting, vetting, contracts, payment, and finding a replacement if the person leaves. The IRS says you don't generally have to withhold or pay any taxes on payments to independent contractors, but that holds only if the person really is one, which the next section covers. The table shows who handles each item, including the paperwork and the cost of a bad fit. It doesn't add up costs, because your wages, state, and benefits change every total. Use it to see which lines you'd be taking on.

How the agency model works at Stellar Staff

For businesses that hire virtual employees through Stellar Staff, the agency column works like this. Stellar handles recruiting, payroll, HR, tracking, and replacements, and you direct the assistant's daily work. Plans are full-time at 160 hours a month: Pro at $1,999 a month and Executive at $2,999 a month, plus $200 a month for a bilingual assistant. Plans run month to month with no long-term contract and can be canceled with 14 days' notice. You interview 2 to 3 finalists and pick one.

What Changes If You Hire a VA Directly as a Contractor?

Hiring a VA yourself as an independent contractor keeps payroll off your plate only if the person really is a contractor. The IRS decides that under common-law rules, weighing evidence in three categories. Behavioral control asks whether you direct what work is done and how. Financial control looks at how the worker is paid, who covers expenses and tools, and whether the worker can make or lose money. The relationship of the parties covers contracts, benefits, how permanent the arrangement is, and whether the work is a key part of your regular business. A full-time assistant who works set hours on your tasks, in your systems, under your instructions, can start to look like an employee under that test. The Department of Labor applies its own standard under the Fair Labor Standards Act and states that employers are responsible for determining whether a worker is an employee.

• If you're unsure about a specific worker, you can file IRS Form SS-8 to ask for a determination of status.
• The DOL's contractor rule is under review. The department announced a proposed rule on February 26, 2026, so check its page for the version in force when you hire.
• Other rules can apply when the assistant lives outside the U.S. Our guides on how to hire a virtual assistant and hiring a VA in the Philippines cover classification and contractor payments abroad.

Through an agency, the agency runs payroll and HR and you pay one invoice, so you aren't the one paying the assistant directly. Ask any agency, in writing, how its assistants are engaged.

This section is general information, not legal or tax advice. Ask an employment attorney or CPA about your specific arrangement.

Which Roles Should Stay With an In-House Employee?

Some work should stay local regardless of the cost difference. If the job needs a person in the building, such as greeting visitors, handling mail and packages, managing inventory, running errands, or staffing an on-site front desk, a remote assistant can't do it. Licensed work stays with licensed professionals. A VA can prepare files for an attorney, a CPA, or a clinician, but can't sign off or give advice that requires the license. Roles that must be on-site because of client contracts, security rules, or regulations belong in-house too. And if you're building a long-term team, with people you plan to promote into supervisors and managers, an employee you hire and develop locally may be the better investment even at a higher cost. The table splits common office work by where it usually fits.

Can a remote assistant replace an in-person office manager?

Partly. In our sales calls, the worry behind this question is usually the physical side of the job: the mail, the supply orders, and opening the office in the morning. Scheduling, vendor emails, invoices, filing, and reporting can move to a remote assistant. The in-person tasks can go to a part-time local employee.

Can a Virtual Assistant Support Your In-House Team Instead of Replacing It?

Often the better answer isn't a VA or an employee, but both. Many businesses keep local staff for in-person and relationship work and add a remote assistant to take over the desk work that pulls those employees away from it. That usually means scheduling, data entry, follow-up emails, CRM updates, and weekly reports. Your office manager stops spending afternoons keying in orders. Your salespeople stop logging their own calls. In that setup, the VA doesn't take anyone's job. The VA takes the tasks that kept your team from the work you hired them for. Our article on insourcing vs. outsourcing looks at which functions to keep in-house across a whole business, and our guide on why hire a virtual assistant helps you count the hours you could hand off.

A mixed team works best when one person directs the VA and the VA uses the same chat, project board, and calendar as everyone else, with access you can revoke. Stellar Staff places administrative assistants and other remote hires who work alongside in-house teams on the client's own tools and schedule.

Questions Owners Ask When Comparing a VA With a New Hire

How much does it cost to hire an employee?

The cost of hiring an employee starts with recruiting, which SHRM's 2025 report puts at a median of $1,200 per nonexecutive hire. Then come wages and employer costs. BLS data for June 2026 shows office and administrative support jobs costing employers $25.22 per hour worked in wages and $11.51 in benefits. Equipment and onboarding time come on top.

What is the true cost of an employee?

It's the wage plus every cost the employer carries because the person is on payroll: Social Security and Medicare, unemployment taxes, workers' compensation, insurance, retirement contributions, paid leave, and recruiting. In the BLS data for June 2026, benefits were 30.0% of total compensation across private industry and 31.3% for office and administrative support jobs.

Is there an employee cost calculator I can trust?

A calculator is only as good as its inputs. Gather the wage you'd offer, your state unemployment tax rate, your workers' compensation premium, the benefits you plan to offer, and your paid leave policy. Then add what no calculator knows, such as equipment, software, and the hours you'll spend hiring and onboarding.

Is a virtual assistant an employee or a contractor?

It depends on how you hire. A VA placed by an agency works through the agency and isn't on your payroll. A VA you hire yourself is a contractor only if the facts support it under the IRS common-law rules and the DOL's standard. If you set the hours, give detailed instructions, and the role is permanent, get advice first.

Do I pay payroll taxes on a virtual assistant?

Through an agency, you pay the agency's fee and the agency runs payroll. If you hire directly and the person truly is an independent contractor, the IRS says you don't generally have to withhold or pay taxes on the payments. If the person is really your employee, employer taxes apply. Rules can differ for workers outside the U.S., so check with your CPA.

How do I hire a virtual employee?

You can hire a virtual employee through a marketplace, on your own, or through an agency. With Stellar Staff, you describe the role, interview 2 to 3 finalists, and pick one, and the search takes 5 to 10 business days. The Pro plan is $1,999 a month for 160 hours, and Stellar handles recruiting, payroll, HR, tracking, and replacements while you direct the daily work.

Compare the Full Cost of Both Options Before You Decide

The comparison that helps you decide puts both options on the same lines: wages, employer taxes, benefits, recruiting, replacement, equipment, and your own time. Use your state's rates and your own benefits where you have them, and the BLS figures above where you don't. Then weigh what isn't about money: whether the work needs someone in the building, whether a license is involved, and whether you're building a team to grow from within.

A VA through an agency is the wrong choice if the job is mostly physical, if the core of the work requires a license, or if a client contract requires on-site or U.S.-based staff. It's also the wrong fit if you have less than a full-time workload, since Stellar Staff's plans are full-time at 160 hours a month, or if you want to develop future managers locally. In those cases, hire the employee and budget for every line in the first table.

If the work is desk-based and steady, a full-time VA through Stellar Staff comes to a third of the cost of a local hire, with recruiting, payroll, HR, and replacements handled. See current plans on our pricing page, or read how our hiring process works.

Figures were checked October 21, 2026, against the BLS (Employer Costs for Employee Compensation, June 2026 data released September 9, 2026, and the Occupational Outlook Handbook, May 2025 data), the IRS, the SSA, the Department of Labor, and SHRM. This is general information, not legal or tax advice. Stellar Staff pricing is current as of October 2026.