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Objective We attempted to estimate the excess annual costs that a US private employer may attribute to employing an individual who smokes tobacco as compared to a non-smoking employee. Design Reviewing and synthesising previous literature estimating certain discrete costs associated with smoking employees, we developed a cost estimation approach that approximates the total of such costs for US employers. We examined absenteeism, presenteesim, smoking breaks, healthcare costs and pension benefits for smokers. Results Our best estimate of the annual excess cost to employ a smoker is $5816. This estimate should be taken as a general indicator of the extent of excess costs, not as a predictive point value. Conclusions Employees who smoke impose significant excess costs on private employers. The results of this study may help inform employer decisions about tobacco-related policies.