How To Calculate Pro Rata Salaries

First, let’s define a pro rata salary. A pro rata salary is a fraction of the full salary paid for a position. For instance, if you have a salary rate of $83,200.00 for a full year's work, that establishes the full base rate of pay for that position. When someone works less time than would normally be required for a full year's work, you then have to divide the number of hours actually worked into the full base rate to establish the pro rata salary rate.

To perform the calculation to determine the pro rata salary for any position you will need to gather the following items of information:

  1. You will need the rate of pay for one year for the position. We will use $83,200.00 in our example.
  2. Determine the number of weeks normally worked per year. We will use 52 weeks in our example.
  3. Determine the number of hours normally worked each week by a fulltime worker. We will use 40 hours in our example.
  4. You will need to know how many weeks the pro rata worker will be working. We will use 26 weeks in our example.
  5. Determine the rate of pay per hour for the fulltime position.
  6. You will need the number of hours the pro rata person will be putting in during the same workweek. We will use a 20-hour work week in our example.

To make your calculations, proceed as follows:

  1. Divide the rate of pay for one year for the position by 52 to determine the weekly rate of pay for the full time worker. $83,200.00 ÷ 52 = $1600.00 per week
  2. Dividing the weekly rate of pay for the full time worker by 40 hours will determine the full time hourly rate for the position. $1600.00 ÷ 40 = $40.00 per hour
  3. Multiply the full time hourly rate by the number of hours per week the pro rata person will be working to determine their weekly rate. $40.00 x 20 = $800.00
  4. Multiply the full time weekly rate by the number of weeks per year the pro rata person will be working to determine their yearly rate. $800.00 x 26 = $20,800.00

The above explanation and example pertains strictly to pro rate salary calculation for part time workers. There are other considerations the pro rata worker should also consider looking into. Among these include benefits, or the lack thereof.

 

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