What is Indirect Labour Cost?

Indirect Labour Cost refers to the cost of labour which cannot be wholly and directly identified with a particular product or job. It is the cost of labour employed for performing tasks incidental to manufacture rather than directly producing the goods.

Indirect labour supports the production process but does not physically convert raw materials into finished goods. Wages and salaries paid to storekeeper, foreman, timekeeper, watchman, factory clerk and inspectors (in some cases) are common examples of indirect labour cost.