How to Calculate Hours Worked for Employees

Proper payroll calculations lead to accurate paychecks.

Hourly workers are paid based on their hours worked and their hourly rate. An hourly employee's hours and pay for each pay period might fluctuate. These employees are usually required to complete a timesheet or use a time clock system. The payroll person must calculate the hours based on what the timekeeping system indicates.

Instructions

1. Determine regular hours. The timekeeping system you are using should have a column for regular hours worked. For instance, say the employee's time for Monday to Friday reflects: in--7:30 a.m., lunch in--11:30 a.m., lunch out--12:30 p.m., out--4:30 p.m. Subtract one hour for lunch each day. Pay the employee 8 regular hours for each day--a total of 40 regular hours. Pay regular hours at the employee's regular pay rate. For instance, say he earns $12 per hour. Calculate as follows: 40 hours x $12 = $480 weekly gross pay.

2. Calculate overtime. Overtime hours are hours worked over 40 regular hours and are paid at 1.5 times the employee's regular pay rate. For instance, say she earns $12 per hour and her time for Monday to Saturday reflects: in--8 a.m., lunch in--12 noon, lunch out--1 p.m., out--6 p.m. Subtract one hour for lunch each day, which equals 54 hours. Pay 40 hours at her regular pay rate. In this example, subtrace 40 from 54, which is 14 hours of overtime. Calculate overtime as follows: 14 hours x $18 ($12 x 1.5) = $252 overtime pay.

3. Pay double-time at twice the employee's normal pay rate. Some employers pay workers who work on weekends or holidays double-time for such hours worked. For instance, say the employee earns $13 per hour and worked 5 hours on Labor Day. Calculate as follows: 5 hours x $26 ($13 x 2) = $130 double-time pay.

4. Add together the amount of money earned from regular hours plus any overtime or holiday amounts earned to arrive at the total gross for the week.

Tips & Warnings

• Often, salaried workers are paid a set wage each pay period. For instance, say the employee 's salary is $43,000, paid biweekly. Calculate as follows: $43,000 / 26 pay periods = $1653.85 biweekly gross pay.

References

• U.S. Department of Labor: Overtime pay

Resources

• Pay Check City: Salary Calculator