How to work out a pro rata salary or wage

You can calculate how much a part-time employee would be earning by first working out how much they would be earning full time. Pro rata is effectively your employee’s share of the whole, which in this case is the full-time salary. Having clear pro rata pay is a way to make sure that your employees are all treated and paid equally in your business. This article explains how to calculate pro rata salary vs wage, and how to calculate holiday pay. To work out your employee’s pro rata salary or wage, divide the equivalent full-time annual amount by the number of full-time hours in a year to get the effective hourly rate, then multiply this by the number of part-time working hours to get the pro rata annual amount. It is usually much more accurate to work out the pro rata amount by hours than by days.

What benefits can an employee working on a pro rata basis receive?

According to part-time workers’ regulations, you should make sure that employees who are paid on a pro rata or part-time basis receive equivalent benefits to your full-time staff. If you are offering pension plans to your full-time employees, for example, you must offer this to your pro rata employees as well.

The benefits that your pro rata employees should receive include:

• the same pay rates for sickness pay, maternity pay and paternity pay;
• holidays;
• opportunities for training and development;
• opportunities regarding promotions and transfers;
• gym discounts or memberships;
• opportunities for redundancy pay.

You should check which benefits currently apply to your full-time staff, and make sure that they are aligned with what you are currently offering to your pro rata employees.

Pro rata holiday pay

As your pro rata employees also need to receive holiday pay, you must calculate the correct amount to give them. For example, if your full-time employees have 28 days of holiday entitlement and work 5 days a week, to work out the right amount for your pro rate employees you need to multiply the number of days a week that they work by 5.6.* So, if your pro rata employee works 2 days a week, your sum should be 2 x 5.6. This will give them 11.2 holiday days a year. If your result has a decimal place, consider rounding this up to the nearest whole number.

*Note: 5.6 is used as the multiplier if the equivalent full-time employee has 28 days of holiday entitlement and works 5 days a week, because 28 days of holiday divided by 5 days a week equals 5.6. If your full-time employees have a different holiday entitlement and number of days per week, you will need to work out the multiplier based on those numbers.

When an employee is moving to a pro rata role

When you advertise a part-time role internally, you should let employees know in the job description that it is pro rata, and if you can, state their pro rata earnings as well. Make sure that your employee’s new role has a clear start date and a set number of hours to be worked per week. Your part-time/pro rata employee should have a contract of employment that states clearly when and how often they will be working for you.

It is advisable for this to be in writing in case there are any future misunderstandings regarding start dates or hours to be worked.

Your contract should also include the following information as applicable:

• pro rata holiday pay;
• any benefits for both full-time and part-time employees;
• notice periods;
• any subsidised parking;
• job title.

It is important to make the information contained in your employee’s contract as clear as possible.

Working out an employee’s pro rata wage or salary is important if you have part-time staff. Doing so does not have to be complex, but it is worth bearing in mind that your pro rata staff should have equivalent entitlements to your full-time staff. This includes holiday entitlement, sickness pay and opportunities for training and development. You will have to work out holiday entitlement on a pro rata basis, as your pro rata employees will have fewer holidays than your full-time employees. If your employee is in any doubt about what their pro rata salary will be, you should discuss their terms and conditions with them. You should make these as clear as possible, and state that a position is pro rata in the job description together with the number of hours a week.

Related: Pay bands in the UK