Calculating a daily salary rate...

Enfieldian

I wondered if anyone had any thoughts on this.

Previously I had always used the following formula to calculate a daily salary:

Annual/52 and then divide by 5

I have come across a company that use the following formula:

Annual/12 and then divide by 30 (as an average number of days in the month)

Thus the monthly total is the same however the daily rate is a lot lower.

Is this common and/or correct?

Little_Vics

Dividing by 5 calculates working days. Dividing by 30 includes weekends so will obviously be lower. I normally divide by 5.

CMoore

Assuming that the role is permanent and full time, Monday through Friday inc.

52 weeks in a year - 5 working days a week = 52 x 5 = 260 working and payable days per year.

Divide salary by 260

Andy_L

Depends, if they are working out how much to pay you for a days overtime they can use whatever method they like, subject to your contract.

My previous employer used annual salary divided by working days in the year (ie 365 less weekends, BH & holiday)

If they are working out if they comply with min wage legislation they must use defined mthods depending on weather you are salaried or hourly paid
http://www.direct.gov.uk/en/Employment/Employees/TheNationalMinimumWage/DG_10037277

Pete111

Using 260 working days (ie salary / 260) is the accepted method

Most contracts state working hours (ie 37.5 per week ) also.

For a company to claim weekends etc are part of this calculation is in my view incorrect.

adg1

Doing Salary / 260 gives the same result as:

Salary / 52 / 5

And

Salary / 4 / 13 / 5 which was my first method.

The one you mentioned spreads the money over the weekend too so the result is lower.