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Do you know how to calculate your wage or salary?

One of the first steps in understanding whether you are being paid correctly is being able to calculate your hourly wage or annual salary. If you are paid hourly, there are times you might need to know how much you earn per week, per month or per year. If you are paid an annual salary, you might want to convert that to find out how much you are paid hourly.

To convert an hourly wage to an annual salary, you first have to know how many hours you work each week and whether you get paid for time off. If you work a traditional full-time job, you might work 40 hours a week and receive pay for up to two weeks off, which means you are likely to be paid for 40 hours for every week of the year. In such a case, start your calculations with your hourly wage. For this example, we'll use $10 to make the math easier.

If you are paid $10 an hour and work 40 hours a week, you make $400 a week. There are 52 weeks in the year, so you make $20,800 per year. If you are paid biweekly, then there are 26 pay periods in the year. If you divide your annual salary by 26, you'll see that your pay before taxes and other deductions each week should be approximately $800.

You can reverse the math to find out your hourly pay if you are a salaried individual. Perhaps you were told you would make $40,000 a year when you started a job, but you realize you are putting in 60 hours each week. Divide $40,000 by 52 weeks, and then divide that amount by 60 hours; you realize you are making $12.82 an hour.

Understanding your wage is the first step in knowing whether you've been misclassified or are receiving incorrect pay. If you think you are not being paid fairly for your work, consider speaking with an employment lawyer about your next steps.

Source: Bankrate, "Hourly Paycheck Calculator," accessed July 08, 2016

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