{"id":7667,"date":"2024-08-06T11:46:49","date_gmt":"2024-08-06T11:46:49","guid":{"rendered":"https:\/\/www.webwork-tracker.com\/blog\/?p=7667"},"modified":"2024-08-06T11:46:50","modified_gmt":"2024-08-06T11:46:50","slug":"how-to-calculate-payroll-hours-with-a-time-tracker","status":"publish","type":"post","link":"https:\/\/www.webwork-tracker.com\/blog\/how-to-calculate-payroll-hours-with-a-time-tracker","title":{"rendered":"How to Calculate Payroll Hours with a Time Tracker"},"content":{"rendered":"\n

Accurate staff payroll is important for all companies. But, its importance and difficulty are increased when dealing with hourly workers. If you manage a team of such professionals, you must calculate payroll hours.\u00a0<\/span><\/p>\n

There are a couple of ways of doing this: <\/span>manually <\/b>and with an <\/span>automated <\/b>solution. Most managers choose the former to save on the costs of payroll software. But, as we\u2019ll cover shortly, a quality time tracker with a payroll feature can help you save lots of time.<\/span><\/p>\n

Who needs to calculate payroll hours?<\/span><\/h2>\n

Before comparing manual and automated ways of calculating payroll hours, let\u2019s explore who needs to do it. Most businesses employ professionals with a <\/span>fixed <\/b>periodic salary. This is the most common employment type across the globe. But, you must calculate payroll hours if you have employees who are paid on an <\/span>hourly basis<\/b>.\u00a0<\/span><\/p>\n

Generally, this applies to freelance professionals and independent contractors. You may wish to employ professionals on such terms for a one-off project. Companies offering <\/span>flexible working schedules<\/span><\/a> to permanent employees may also use hourly payments. This way, they can pay their team members proportionally to the amount of completed work.<\/span><\/p>\n

If your business matches one of these descriptions, then you must calculate payroll hours. Let\u2019s explore the process now, starting with the requirements.<\/span><\/p>\n

What do you need to calculate payroll hours?<\/span><\/h2>\n

You need two key things to calculate payroll hours: working time data and hourly rates.<\/span><\/p>\n

Working time data<\/span><\/h4>\n

On the surface, collecting working time data is simple. But, ensuring its <\/span>accuracy <\/b>is quite challenging. This is especially true for remote professionals. Your employees must track how much they spend working and report this information to your managers. Doing this manually raises concerns in two key areas: trust and accuracy. The former is significant with newer employees who you may not know well enough. But, the latter can affect even long-time team members. Tracking time manually is prone to human errors. It is a tedious task that can get repetitive quickly. This is the first place where a quality time tracker like <\/span>WebWork<\/span><\/a> can help you calculate payroll hours.<\/span><\/p>\n

Hourly rates<\/span><\/h4>\n

Determining the hourly rates for your employees is a simpler task. But, it may become a bit challenging if you want to pay varying rates for different projects. You may want to do this to help your hourly workers prioritize their tasks more easily. This will require not only accurate time tracking data but also effective task management.<\/span><\/p>\n

\"A<\/p>\n

How to calculate payroll hours manually: step-by-step<\/span><\/h2>\n

Now, let\u2019s go over the steps of calculating payroll hours manually, starting with calculating time.<\/span><\/p>\n

1. Subtract unpaid time<\/span><\/h3>\n

To calculate working time, you must subtract unpaid breaks from your team\u2019s tracked time. Or, you can instruct your employees to do this themselves and show you their calculations. This way, you will only need to verify your employees\u2019 data, slightly reducing your workload.<\/span><\/p>\n

2. Round time<\/span><\/h3>\n

To make calculating payroll hours easier, you can round time. Make sure to check your local regulations, as they can vary across the globe. For example, in many US states, you can round to the nearest 15 minutes. But, in many other places, rounding is not allowed.<\/span><\/p>\n

3. Convert from hours and minutes to hours with decimals<\/span><\/h3>\n

At this point in the process, you\u2019ll have tracked time in hours and minutes. You must convert this to a single number representing tracked time to calculate payroll hours. Simply divide your minutes by 60 and add this number to your tracked hours.<\/span><\/p>\n

For example: 30 \/ 60 = 0.5 hours.<\/span><\/i><\/p>\n

4. Determine the hourly rate<\/span><\/h3>\n

Determining the hourly rate of your employees should be simple. An exception to this is if you pay your team members different rates for certain projects. In this case, you must separate tracked time by projects and calculate payroll hours for each with their assigned rates.<\/span><\/p>\n

5. Calculate payroll hours<\/span><\/h3>\n

Finally, you can complete your calculation. Simply multiply working hours by your team\u2019s hourly rates.<\/span><\/p>\n

For example, if an employee worked <\/span><\/i>31.5 hours<\/i><\/b> with a rate of <\/span><\/i>$20\/hour<\/i><\/b> and <\/span><\/i>9 hours<\/i><\/b> with a rate of <\/span><\/i>$25\/hour<\/i><\/b>:<\/span><\/i><\/p>\n