Wage calculation for Shift Work
Shift work wage calculation
Working out the wage for a shift worker is never easy. Along with basic pay requirements, you may also have to factor in shift allowances, bonuses, and pro-rata payments into the mix. In this guide, we will dig into how you can be successful with shift work wage calculation. Let’s get started.
How do you calculate shift work pay?
If you work as a shift worker, calculating pay may be basic math. But the variables involved can be difficult to understand. Most times, you may need to take into account the length of shifts (which themselves can vary) and any variances in the work schedule.
In basic terms, you work out the calculation for shift work pay by multiplying the number of hours in a specific period by the hourly rate of the employee. This will give you the wage for this period. In shift work, it is important to understand that the number of hours worked in each period can be different. This can vary on a weekly or monthly basis and can lead to differing wage amounts over time.
How to work out the yearly salary for Shift work?
The variance in hours worked by shift workers can make it difficult to work out the yearly salary for an employee. But most shift workers’ hours follow a pattern that can be used to figure out what their yearly salary is. Here are the steps to working this out.
- Work out how many hours you work per shift of the same length.
- Multiply this by how many times you perform this shift during a week or month (whichever is easier).
- Do the same for any other shifts with different hours in this same period.
- Add all the different shift hours together to get your total hours in this period.
- Multiply the number of hours by your hourly rate.
- Multiply this amount by how many times this period repeats throughout the year. This would be 52 if your period is weekly, or 12 if it is monthly.
Is shift allowance different from a shift wage?
Yes. A shift allowance is a payment made to an employee for undertaking specific shift work (e.g. night or evening shifts, etc). This is generally paid as a fixed sum or an added hourly allowance and given on top of a basic salary. A shift wage is the basic salary amount earned during a shift based on the hourly rate of the employee.
How does rota allowance work?
If your employer pays you a rota allowance, then this can be paid as an additional payment on top of basic salary. Your employer will pay this based on the number of hours worked. Again, they may give you this as a lump sum or an additional hourly amount.
How does a bonus or commission affect shift work pay?
Any bonuses or commissions paid to an employee are additional to their basic shift salary. If an employee is part-time, some bonuses may be pro-rata and they will earn a percentage of the amount based on how many hours they work.
How to choose the right shift scheduling software?
We have got you covered. It can be a tricky thing if you do not choose the right shift planning software for your needs. It can also be very costly for your business. The right shift planning software needs to do the following –
- Allow rota planners and shift planners flexibility to create shifts.
- Flexibility to include employee special requests.
- Allow rota planners to respond to last-minute shift changes or shift absences
- Help faster communication to employees on shift schedules and shift changes
We have consolidated more information on our guide to choose the right shift planning software here.
Papershift is Europe’s best workforce planning software. It is loved by over 200,000+ HR managers. We also urge you to book a free demo appointment with us to take a look at different possibilities to manage shifts with ease.