Payroll Cost is an annual accounting measure that attempts to quantify the total expenses incurred by a company for wages, salaries and other employee-related costs. This includes regular salary payments as well as any bonuses, commission or other non-regular payouts. It does not include employer contributions to health insurance, Social Security or other benefit programs. Payroll Cost is essential in budgeting and forecasting, as it provides a reliable estimate of what a company will be expected to pay its employees over the course of a year. A well-managed payroll cost structure can help ensure the stability and success of a business.