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Calculate prorated monthly salary by worked days.
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When an employee joins mid-month, resigns before the last working day, or takes unpaid leave, their salary must be prorated — calculated for exactly the days they were entitled to pay. Getting prorated salary right is one of the most routine yet error-prone tasks in payroll, with two competing methods and important policy choices that must be made consistently.
There are two standard approaches to prorated salary calculation. The method you choose must be defined in your HR policy and applied consistently across all employees.
Calendar Day Method: Prorated Pay = (Monthly Salary ÷ Total Calendar Days in Month) × Days Worked
Example (June — 30 days): $4,500 ÷ 30 × 20 days = $3,000.00
Working Day Method: Prorated Pay = (Monthly Salary ÷ Total Working Days in Month) × Days Worked
Example (June — 22 working days): $4,500 ÷ 22 × 15 days worked = $3,068.18
| Method | Best For | Consistent Month-to-Month? | Typical Usage |
|---|---|---|---|
| Calendar Days | Fixed denominator, no ambiguity | No (28–31 days varies) | UK, Australia, many EU countries |
| Working Days | Reflects actual work schedule | No (working days vary) | India, Philippines, many Asian markets |
| Fixed Divisor (e.g. 26 or 30) | Maximum consistency | Yes | Some large enterprises — defined in policy |
New hire joins on the 15th of a month (March — 31 calendar days, 22 working days). Monthly salary: $5,000.
Enter monthly salary, joining or exit date above — the calculator handles calendar day and working day methods instantly.
Under the calendar day method, weekends are included — you divide by total calendar days and multiply by all days from join to month-end, including weekends. Under the working day method, only weekdays count in both the numerator and denominator. Be explicit in your HR policy about which method applies.
Daily rate proration is straightforward: Daily Rate × Days Worked = Prorated Pay. To derive the daily rate from a monthly salary: Daily Rate = Monthly Salary ÷ Working Days in Month. This is useful for short-term contracts, temp workers, and freelancers billed daily.
Yes. Prorated gross pay is still subject to income tax, provident fund, and other statutory deductions. The deductions are calculated on the actual prorated amount, not the full monthly salary. Always apply deductions after calculating the prorated gross.
Under the calendar day method, public holidays within the period are automatically included in the count. Under the working day method, public holidays are typically excluded from both numerator and denominator since they are non-working days. Check your company policy and jurisdiction's statutory treatment of public holidays in partial-month calculations.
Disclaimer: This calculator is for informational purposes only and does not constitute legal or financial advice. We do not guarantee the accuracy or completeness of the results. Please consult a qualified professional for advice specific to your situation.