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How to Calculate Semi-Monthly Pay Based on Hourly Rate
Calculating semi-monthly pay when you are an hourly employee can be slightly confusing because the number of workdays in a semi-monthly period (1st-15th, 16th-end) changes depending on the month. Unlike bi-weekly pay, which occurs every two weeks (26 times a year), semi-monthly pay occurs exactly 24 times per year.
To accurately determine your semi-monthly gross paycheck, it is best to calculate your annual income first and then divide by the 24 pay periods. This standardizes your income regardless of whether a month has 28, 30, or 31 days.
The Formula
The most accurate formula for converting hourly wages to a semi-monthly salary equivalent is:
- Step 1: Calculate Annual Base Pay = Hourly Rate × Hours Per Week × 52
- Step 2: Calculate Semi-Monthly Gross = Annual Base Pay / 24
Detailed Calculation Steps
Follow these steps manually if you wish to verify the calculator's results:
- Identify your hourly rate: This is your base pay per hour.
- Determine weekly hours: Standard full-time employment is usually 40 hours.
- Calculate Weekly Pay: Multiply your rate by your weekly hours.
- Annualize it: Multiply the weekly pay by 52 (weeks in a year).
- Divide by 24: Divide the annual total by 24 to get your gross pay per paycheck.
Real-World Example
Scenario: You earn $28.00 per hour and work a standard 40-hour week.
- Weekly Pay: $28.00 × 40 = $1,120.00
- Annual Pay: $1,120.00 × 52 = $58,240.00
- Semi-Monthly Paycheck: $58,240.00 / 24 = $2,426.67
Handling Overtime
If you regularly work overtime, this must be added on top of your base salary. Since semi-monthly periods don't align perfectly with workweeks, overtime is often calculated based on the specific hours worked in that pay period. However, for estimation purposes:
Calculate your weekly overtime earnings (OT Hours × Rate × 1.5), multiply by 52 to get the annual overtime total, and then divide by 24 to see how much extra you can expect per semi-monthly check on average.
Difference Between Bi-Weekly and Semi-Monthly
It is crucial not to confuse the two:
- Bi-Weekly: Checks every 2 weeks. Total 26 checks/year. Each check is slightly smaller.
- Semi-Monthly: Checks twice a month (e.g., 15th and 30th). Total 24 checks/year. Each check is slightly larger because the annual salary is divided by fewer periods.