For many people, calculating hourly pay is unimportant. However, if you are a monthly salaried employee or self-employed, calculating hourly pay will take several steps. You can calculate this pay based on a specific project, a specific time period, or a monthly salary. If you use a monthly salary, you can also determine the variables to make your calculations more accurate.
Step
Method 1 of 3: Determining Hourly Pay if You Are Self-Employed
Step 1. Calculate your total hours worked
To be useful, you must first determine your pay period. You can set hourly pay based on annual earnings for more accurate results, or you can set hourly pay for a specific job or time period.
For example, if you are paid for each job or project, then count only the total hours you worked to determine your hourly pay on the project. Or, you can set an hourly rate based on a shorter timeframe, such as monthly or weekly
Step 2. Calculate your income
View your payslip. Make sure you use the same pay period you choose to determine your hourly pay. Again, this hourly rate can be based on a specific project or over several pay periods.
You can also choose whether or not to include taxes in your calculations. Otherwise, your hourly pay will be higher
Step 3. Divide your total earnings by your hours worked
You'll get an hourly rate, based on the project or timeframe you've previously selected.
- Income/hours worked = Pay per hour
- Example: IDR 150,000,000, 00/2,114 = IDR 71,000, 00 per hour.
- You can check your results with this salary converter, which also allows you to correct for several different variables.
Method 2 of 3: Determining Hourly Pay if You Get Paid
Step 1. Calculate your annual income
Many people may already know the annual salary, but if you don't, check your last paycheck. Use gross pay (gross income) instead of net (net income) - this is the amount you earn before tax - and multiply that amount by the amount paid in a year.
- For those who are paid fortnightly, multiply by 26.
- For those who are paid on two specific dates per month, for example the 15th and 30/31st, multiply by 24.
Step 2. Calculate how many hours you work in a year
As a general rule, you can use standard formulas like:
- 7.5 hours per day x 5 days per week x 52 weeks per year = 1,950 working hours per year.
- 8 hours per day x 5 days per week x 52 weeks per year = 2,080 hours worked per year.
Step 3. Calculate your hourly pay
Once you've got the results, divide the total annual earnings by the total annual hours to get your estimated hourly pay.
For example, if your total income is $150,000,00 and your total hours worked is 2,080, then 150,000,000/2,080 = approximately $72,100.00 per hour
Method 3 of 3: Using Complex Calculations to Determine Hourly Pay Based on Salary
Step 1. Adjust your annual income
If possible, add any extra income from your job to your total annual salary. This extra income includes tips, bonuses, work incentives, etc.
- Any bonuses or extra work incentives that you will earn should also be added directly to your total annual income.
- If you get a salary that also provides an opportunity for you to earn tips, the process will become a bit more complicated. Record all the tips you get over a period of weeks or even months, and divide the total by the number of weeks of recording to get the average weekly tip count. Multiply this result by the number of weeks you tipped in the following year (based on predictions), and remember to subtract the weeks that won't tip you - for example when you go on vacation.
- The general rule for calculating tips is: the more weeks you use to calculate the average, the more accurate the results.
Step 2. Add hours to your calculation if you work overtime
For overtime pay, multiply the number of overtime hours you worked by the pay you received for the extra work, then add the total to your annual salary.
- Your overtime hours may or may not be paid, depending on your position. Add up all of these hours worked, regardless of whether you were paid for them or not.
- For example: You work two hours of overtime each week, except when you are on leave, which is two weeks each year. So, your extra working hours are 2 hours x 50 weeks = 100 hours per year.
- In the example above, your adjusted annual hours worked would be: 2,080 + 100 = 2,180.
Step 3. Subtract hours from your calculation if you get paid leave
Add up all the hours you didn't work and subtract the result from the total number of hours you worked in a year. Make sure you include holidays, sick leave, special leave, and any time you come in late or leave early.
- Make sure you include only paid leave that you will use. For example, you might get two weeks of sick leave, but chances are you won't use all of them.
- Another example, say you take two weeks of vacation every year, never get sick, and always come home an hour early on Fridays. In this case, the reduced working hours will be (8 hours x 2 weeks) + (1 hour x 50 weeks) = 66 hours per year.
- Your adjusted annual hours for this example are: 2,180 - 66 = 2,114.
Tips
- Check if there will always be work. If you only get paid when there is work, then your effective income will be much lower.
- When you do the division, the rounding error means your hourly pay is slightly less accurate than your annual salary. However, small changes to the annual salary (up to IDR 2,000,000.00) will still result in the same hourly pay.
- Check if you are being paid for the hours you are on leave and find out how many hours you are spending on time off.
