How to Calculate Hourly Time for Payroll
Most large companies have a payroll department, but if you're a smaller business, chances are that you, as an owner, are going to be doing your own payroll accounting. Keeping accurate records and figuring out exact payroll figures is extremely important, but something that can be learned in a short amount of time. Simple math is all that is needed, along with accurate time records and a calculator.
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Instructions
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Gather all your time sheets or records together. You will either have hand written sheets or printouts from a POS system. Make sure that all of the dates and hours have been filled in.
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Add together the regular hours from your first employee. Multiply this hourly number by the hourly rate of pay that this employee has. If employee A makes $10 per hour and she worked 36.5 hours, the gross pay for this week would be $365.
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Add separately any overtime hours that any employee may have worked. If employee B worked 43.5 hours, then he worked 40 hours regular time and 3.5 hours of overtime. At the same rate of pay, he would earn $400 in regular time. Overtime is paid at 1.5 times the regular rate, or $15 per hour, thus earning him $52.50 in overtime, for a total of $452.50 in gross pay for the week.
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If your company pays holiday pay, it is usually set at double time. Any hours worked on a holiday would be paid twice as much per hour as regular hour days. This is exclusive of any regular hours worked. If employee C worked 12 regular hours and 6 hours on a holiday, then she would get paid $120 in regular pay and $120 in holiday pay, totaling $240 for the week.
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Tips & Warnings
There are online calculators that will do this work for you, but it is a good idea to have knowledge of how this process works for your business before relying on websites to do the work.
Keep all records in a safe file for at least one year in case of salary or other employee disputes.
