Use our simple equation to work out your hourly rate
Whether you’re negotiating your salary, job-hunting, or requesting a pay rise, there are plenty of reasons to convert either your hourly rate to your annual salary or vice versa. Read on for our simple equation that will do all the hard work for you.
If you have a typical work week and work around 8 hours per day, this straightforward approach to calculating your salary will work perfectly. However, if you tend to work a lot of overtime, this may not be the most accurate.
Use the following formula:
(Annual Salary / Number of weeks in a year) / Hours worked per week = Hourly Rate
Example: Let’s say you work 35 hours per week and earn £35,000 per annum. There are 52 weeks in a year, so we’ll begin by dividing the annual salary into 52.
(£35,000 ÷ 52) ÷ 35 = hourly rate
£673.07 ÷ 35 = hourly rate
£19.22 = hourly rate
Wondering if your current salary stacks up to market averages? Click here to access our 2023 Salary Survey to view average salaries in your sector.
Converting the hourly rate to an annual salary
To reverse the process and calculate your hourly rate to your annual salary, you’ll need to work out how many hours you tend to work on an average week to estimate your annual salary. Then, use the below equation:
(number of hours per week x hourly rate) x number of weeks in a year = annual salary
Again, there are 52 weeks in each year and for this example let’s say you work 35 hours per week and earn £19.22 per hour. Here’s how it looks once we put these numbers into the equation:
(35 hours x £19.22) x 52 weeks = annual salary
£673.07 x 52 weeks = annual salary
£35,000 = annual salary
Points to consider
If you earn a commission or work overtime, your salary will vary – so remember to consider this when using the calculation above. There are several online calculators that can help you to work out your salary when it’s influenced by lots of different factors.
One challenging factor can be earning an overtime rate that’s higher than your basic hourly rate. Many companies have an overtime rate of one and a half times your basic rate – this is commonly known as ‘time and a half.
However, this varies between companies and it’s worth noting that employers have no legal obligation to pay their employees for overtime. If you’re unsure, refer to your contract of employment – and if you are paid for it, it should also provide details of how the rates are calculated.Salary Surveys 2023