The Salary Calculator converts salary amounts to their corresponding values based on payment frequency. Examples of payment frequency include biweekly, monthly, or annual payments. Results include unadjusted figures and adjusted figures that account for vacation days and holidays per year.
This salary calculator assumes the hourly and daily salary inputs to be unadjusted values. All other pay frequency inputs are assumed to be holidays and vacation days adjusted values. This calculator also assumes 52 working weeks or 260 weekdays per year in its calculations. The unadjusted results ignore the holidays and paid vacation days.
A salary is the payment from an employer to an employee for their time and work contributed. Salaries of full or part time employees are normally annual-based, and mainly paid in the currencies of their respective countries, which can be accompanied by compensation of small fractions of goods or services. Most salaries (and wages) are paid after accumulated amounts of time, typically monthly, semi-monthly, bi-weekly, weekly, etc.
To protect workers, many countries enforce minimum wages set by either central or local governments. Also, unions may be formed in order to set standards in certain companies or industries.
There are no differences between wage and salary as a way of referring to payment for employee contribution, except for one difference. While the word “salary” is best associated with employee compensation on an annual basis, the word “wage” is best associated with employee compensation based on the number of hours worked multiplied by an hourly rate of pay. Generally speaking, wage-earners connotatively refer to lower-amount earners than salaried employees.
Full or part time employees (regardless of wage or salary) typically have other benefits, such as employer-contributed healthcare insurance, payroll taxes (half of the Social Security and Medicare tax), unemployment tax, retirement contribution, paid holiday/vacation days, bonuses, and other insurances, though part time employees are less likely to because of the high-turnover rates associated with their positions. Nevertheless, when adding all these benefits together on top of corresponding salaries, the average of the sum can be anywhere around 1.3 to 3 times the employee’s base wage or salary. With that said, salaried employees generally do not get overtime pay, while wage earners are more likely to.
Self-employed contractors (freelancers who sell their goods and services as sole proprietorships) tend to use their advertised hourly rates as a way of referencing compensation, similar to wage-earners. Contractors’ payments are often hourly, daily, or weekly based. Since contractors do not have benefits, their pay rates are generally higher than the salaries of equivalent full time positions. However, rates in the real world are mainly supply-demand driven; it is not rare to see them take lower compensation when adjusted for the real world. On the other hand, some contractors with rare, special skills can charge ten or more times the normal going rate!
How Unadjusted and Adjusted Salaries are Calculated
Using a $10 hourly rate with inputs resulting in an average of eight hours worked each day and 260 working days a year (52 weeks multiplied by 5 working days a week), to find the annual unadjusted salary in order to convert to other periods, the calculation is as simple as:
The hourly rate is multiplied by the number of working days a year (unadjusted), and subsequently multiplied by a calculation of the number of hours in a working day based on inputs. The result is an unadjusted amount. On the other hand, the adjusted annual salary is:
Using 10 holidays and 15 paid vacation days in a year, subtract these days from the total number of working days a year.
All bi-weekly, semi-monthly, monthly, and quarterly figures are derived from these annual calculations. It is important to make the distinction between bi-weekly, which happens every two weeks, and semi-monthly, which occurs twice per month, usually on the fifteenth and final day of the month.
Different Pay Frequencies
The calculator contains options to select from several periods normally used to express salary amounts, but actual pay frequencies as mandated by varying countries, states, industries, and companies can and will differ. In U.S., there is no federal law that mandates pay frequency, except one stating that employees must be paid in routinely and predictable manners. However, at the state level, nearly every state has minimum pay frequency requirements 2 .
The most common pay frequencies are explained below.