Pro rata salary calculation

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This article explains how Personio automatically calculates prorated fixed salaries if an employee joins or leaves the company in the middle of a month.

This type of calculation also applies to mid-month salary adjustments and scheduled leave periods. Go to Settings > Salary & Payroll > General > Salaries to define the basis on which prorated salaries should be calculated in Personio according to your company’s internal regulations. Personio provides for two options for doing this: prorate calculations based on a 30-day period or based on the actual number of days in the month.

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Example

The following example illustrates the two different approaches to prorate salary calculations based on a salary increase which is to take effect on the 15th of the month. It clarifies the effect the different calculation approaches will have on the salary paid, depending on the method used:

 

Prorate Salary Calculation – 30 days/month

Prorate Salary Calculation  – all days of the month

Salary to increase on

15th January (31 days)

14/30 * 1900 = €886.67

17/30 * 2800 = €1586.66

Total = €2473.33

 

14/31 * 1900 = €858.06

17/31 * 2800 = €1535.48

Total = €2393.54

Salary to increase on

15th February (28 days)

 14/30 * 1900 = €886.67

14/30 * 2800 = €1306.66

Total = €2193.33

 

14/28 * 1900 = €950.00

14/28 * 2800 = €1400.00

Total = €2350.00

Salary to increase on

15th April (30 days)

 14/30 * 1900 = €886.67

16/30 * 2800 = €1493.33

Total = €2380.00

 

14/30 * 1900 = €886.67

16/30 * 2800 = €1493.33

Total = €2380.00

Please note that it is always the actual number of working days which is considered in the numerator, regardless of the chosen calculation approach.

 

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