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Pro rata salary calculation with Personio Payroll

 

Note that this article is only relevant for you if your company is located in Germany. 🇩🇪

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In this article, you will learn how the pro rata salary calculation works in Personio Payroll.

General information on pro rata salary calculation in Personio Payroll

The pro rata salary calculation is applied to the base salary and predefined recurring compensation when the following cases occur during the payroll period:

  • Entry after the first day or exit before the last day of the month

  • Changes in remuneration (increase/decrease)

  • Change in remuneration type (hourly wage/fixed salary)

  • Unpaid leave and time off

Depending on the calculation method used, the pro rata salaries may vary. Personio already offers two calculation methods, which are supplemented by another method in Personio Payroll. You can choose between the following calculation methods: 

  • Based on 30 days (Personio Core)
  • Based on number of calendar days (Personio Core)
  • Based on number of actual working days (Personio Payroll)

You can set or change the method for pro rata salary calculation every year at the turn of the year, i.e. on 01.01.XXX. Below we explain how to set this up in Personio Payroll and how the different methods work.

Define and change the method for calculating pro rata salary

In Personio Payroll, the method for calculating pro rata salaries is linked to the permanent establishment. Therefore, you must set up the method separately for each permanent establishment and, if necessary, change it separately.

To do this, follow these steps:

  1. Go to Payroll > Personio Payroll and open the Manage tab. 
  2. Click on Salary Proration and select the desired permanent establishment.
  3. Click the edit button and select the method for prorated salary calculation.
  4. If necessary, select an effective date (always 01.01.XXXX of each year) and save your information.

Notice
If you date a change in the method for calculating prorated salaries back in time, prorated salaries will be recalculated retroactively.

Overview of methods for pro rata salary calculation

The two methods Based on 30 days and Based on number of calendar days are part of the basic functions of Personio. For more information about these methods and application examples , see the related article.

With Personio Payroll, you can also calculate based on the days actually worked. Below is an example of this method.

 

Actual days worked

Formula: Pro rata salary = number of days actually worked / number of working days in the month * 100% basic salary

Actual days worked and working days in the month include: Actual days worked and working days in the month do not include:
  • Days included in the working time model according to the employment contract
  • Public holidays that fall on days in the working time model
  • Paid time off (e.g. B. vacation) that fall on days in the working time model
  • Unpaid time off
  • Days outside the working time model
  • Days after leaving mid-month
  • Days before entering the middle of the month

Example
An employee joins the company in the middle of the month. Further details:

▶︎ Start date 15.05.
▶︎ Working time model: Monday-Friday
▶︎ Actual days worked: 13
▶︎ Working days in May: 23
▶︎ Basic salary 100%: €3,000.00

Calculation: 13 days actually worked / 23 working days per month * €3,000.00 = €1,695.65217 (rounded: €1,695.65)

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