# Calculation of Labor Rate Variance

The labor rate variance is defined as any deviation from standard in the average hourly rate paid to workers. It is the difference between the actual labor rate paid and the standard rate, multiplied by the number of actual hours worked. It is calculated as:

Labor rate variance = (Actual rate – Standard rate) x Actual hours of labor used

Direct Labor Yield Variance: Learning Objective of the article: Define and explain labor yield variances. Calculate labor yield variance. Rate and efficiency variances of labor are explained on direct labor rate variance page and direct labor efficiency variance page respectively. Here, our focus is