Depending on your job, you may get paid either an hourly wage or a yearly salary. Some employees may prefer to work at an hourly rate because it helps them get a better sense of the amount they are getting paid for a specific time frame. On the other hand, those who work a full-time job may prefer the security and stability that comes with getting paid a yearly salary. At the end of the day, it doesn’t matter if you’re getting an hourly wage or a salary. But for those who work on a yearly salary and are curious to know how much they are making per hour, there’s a simple formula you can use to get your answer for an hourly to salary calculator.
Hourly Wage vs. Yearly Salary
Getting paid an hourly wage has many pros and cons, as is getting paid a salary annually. It really depends on the industry, the nature of the job and on the position, and whether or not you feel comfortable with the way you are paid.
If you get paid an hourly wage, then there’s a good feeling of knowing that you’re getting paid for the exact number of hours you're working. Often, the expectation is that you're not going to work more than your required number of hours; if you do work overtime, however, you will be compensated for that time. You may have the flexibility to change your schedule so that you can still get your hours, in case you need to take a day off from work. You may even be able to put in additional hours, if you want to make more money. That being said, you will lose money for any hours you don’t put in, which means that your paycheck won’t always be consistent and neither will your schedule. You may not get any benefits and your job may not be as secure.
Getting paid a yearly salary works for some people, because they can feel happy and secure, knowing that they are getting a regular paycheck. It's likely that they have more benefits with a salaried position than they would otherwise. Often, a 401K and health insurance come with a salaried position. Also, with a salaried position, work schedules are much more consistent, vacations and sick days are explicitly stated, and in general, you may get paid more than you would with an hourly position, because your work schedule is set at 40 hours a week. One of the biggest issues with getting paid a yearly salary, however, is that you may be expected to put in additional hours beyond your regular hours, since you're paid a set salary. If you choose not to put in the additional time, you may be seen as a “lazy” employee in a competitive industry.
Why Figure Out Your Hourly Wage?
If you feel that you're putting in considerably more hours a week on your 40-hour-a-week job than should be required in an 8-hour day, then you might be wondering what your hourly wage would be if you were getting an hourly rate instead of a yearly salary. When you do the math, you might discover that your hourly wage is a lot lower than you thought. If this is the case, you may choose to speak with your employer about what you’re experiencing, to see if you can reduce your work responsibilities or increase your pay. Of course, you may also discover that your hourly wage would actually be quite high, in which case, consider the positive points of your job.
Salary to Hourly Calculator
To figure out your hourly wage based on your yearly salary, all you do is this: Take your yearly salary and divide that number by 52 (the number of weeks in a year) and then by 40 (the number of hours in a standard work week). Of course, if you work less than 40-hours a week (perhaps, 35 hours) then use that number, instead.
For instance, if you get paid $45,000 a year and you want to know what your hourly wage is, simply divide that number by 52, which gives you approximately $865. Take this amount and divide it by 40 and you’ll get $21 an hour. This is your hourly wage. That being said, you would have to account for the taxes coming out from your salary, and which benefit packages you and your employer are paying into.
You may receive a monthly or daily salary. Daily wages are calculated using either the gross rate (for paid public holidays, paid leave, salary in lieu and salary deductions) or the basic rate (for work on rest days or public holidays).
Monthly wages
For calculating salary, a “month” or “complete month” refers to any one of the months in the calendar year.
Calculate your pay for an incomplete month of work
How an incomplete month pay is calculated
Salary for an incomplete month of work is calculated as follows:
| Monthly gross rate of pay ------------------------------------ Total number of working days in that month | × | Total number of days the employee actually worked in that month |
If you take no-pay leave
If you are a monthly-rated full-time employee and took unpaid leave for the month, you should count it as an incomplete month of work to calculate your salary.
Definitions
| When the number of hours worked in the day is 5 or less. |
| When the number of hours worked in the day is more than 5. |
Where an employee:
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Total amount of money including allowances, payable for one month's work. This excludes:
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Excludes rest days and non-working days, but includes public holidays. For employees with fixed rest days on Sundays or non-working days on Saturdays, the total number of working days per month for year 2021/2022 is shown in this table. |
| Includes public holidays, paid hospitalisation leave and annual leave, if entitled. |
Basic rate of pay
For calculating pay for work on a rest day or public holiday. |
| Basic rate of pay includes wage adjustments and increments that an employee is entitled to under a contract of service. |
Basic rate of pay excludes:
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How it is calculated
For a monthly-rated employee, the basic rate of pay for 1 day is calculated as follows:
12 × monthly basic rate of pay
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52 × average number of days an employee is required to work in a week
Gross rate of pay
For calculating:
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| Gross rate of pay includes allowances that an employee is entitled to under a contract of service |
Gross rate of pay excludes:
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Calculate your gross rate of pay
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How it is calculated
For a monthly-rated employee, the gross rate of pay for 1 day is calculated as follows:
12 × monthly gross rate of pay
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52 × average number of days an employee is
required to work in a week