# hourly rate calculation



## Mel (4 Aug 2011)

Is there a standard calculation used for calculation of hourly rate from an annual salary? 
Is it different if hourly rates only apply and no salary per se is agreed to (i.e., additional hours are paid at normal rate)? 
I'm confused to find that the annual rate that has been set is returning less annually than the hours worked x rate would suggest. This is in private sector.


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## millieforbes (4 Aug 2011)

Is this someone moving from part time to full time work?

The difference could be holidays?


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## Mpsox (4 Aug 2011)

Does the contract specify x salary for y hours and are you working more then the y hours on the contract?. In effect, are you working overtime at a standard hourly rate


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## Ardiff (4 Aug 2011)

Mel said:


> Is there a standard calculation used for calculation of hourly rate from an annual salary?
> Is it different if hourly rates only apply and no salary per se is agreed to (i.e., additional hours are paid at normal rate)?
> I'm confused to find that the annual rate that has been set is returning less annually than the hours worked x rate would suggest. This is in private sector.



Hi there, this may help.
http://mynewcv.blogspot.com/2010/08/ardiffs-law-whats-my-daily-rate-it.html


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## Mel (4 Aug 2011)

It's none of the above - the contract has always stated an hourly rate for standard 39 hours, and the same rate for over that. 
In a new agreement, an annual figure has been agreed, but when I extrapolate the 39x52xrate shown on payslip, I come up with slightly less than the agreed amount. 
There seems to be a complex calculation in place that nobody internally fully understands. I think it's [((salary/365)x7 )x52]/(39x52). Actually, doing that just now has given me the same value as the lesser rate x 39x52. 
It's not a significant amount, but would cover a bill each year, and it's more the principal of the matter given the sacrifices I have made for the company, particularly over the past 4 years. 
I suppose my question is how common is this, that your agreed salary is not what you actually receive gross, based on an abstract calculation that I didn't think existed outside the public sector (I remember in a public sector job, people would finish on random days like Mondays, as pay was calculated over 7 days).


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## DB74 (4 Aug 2011)

To work out your annual salary on an hourly basis, you should:

1. Take your annual salary
2. Divide it by 46 to give the weekly gross figure (assuming a 5 day working week with 4 weeks paid annual leave and 10 paid public holidays means that you work 46 weeks per year)
3. Divide by 39 hours per week to give your hourly rate


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## Mel (4 Aug 2011)

Thanks DB74 - that gives me a significantly higher figure though, as holidays/pubic holidays are paid.


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## DB74 (4 Aug 2011)

Yes but someone working on an hourly basis would also be entitled to those same paid annual holidays and public holidays

Suppose you had someone on an annual salary of €46,000 and working a 40 hour week

They would be on an effective hourly rate of €25 per hour (€46,000 / 46 weeks= €1,000 per week / 40 hours = €25 per hour)

Someone who was paid €25 per hour and worked a 40 hour week would earn the same gross wage over a 52 week period because they would also be entitled to the 10 paid public holidays and also to 4 weeks paid annual leave.


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## Mel (4 Aug 2011)

They are using the other calculation for whatever reason, which is giving me slightly less per annum than was agreed.


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