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When it’s time for annual performance reviews, if you plan on consisting of pay raises, you require to understand the basic math behind calculating pay increases correctly. Raises deserve to be based upon any variety of things including a worker’s piers, standard market rates, size of time top top the job, the quantity of occupational to do, and even whether or no the boss likes the employee or not. There space few, if any, laws that govern how and also when rises are granted, for this reason it’s approximately you to identify what you’re willing to give.

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civicpride-kusatsu.net has a free pay raise calculator that have the right to help.

Calculating the Percentage

Generally, friend will want to increase their salary by some percentage. The national median pay increase usually hovers in between 3% to 3.5% relying on the year. The trend is to reward top performers through a greater than average pay raise and average workers with reduced pay raises.

I have written around percentage prior to – in the post around calculating sales taxation – currently we’ll relate percent to pay increases.

When your employee is ready for a pay increase, decision what percentage is fair and also then perform the adhering to calculation:

(current rate)(percent increase)=(increase)

Step 1: convert the percentage into decimal form

This is quite basic, but you need to transform the percentage into a genuine number that you have the right to use to multiply by the employee’s present pay rate. To carry out this, simply move the decimal two places to the left. Because that a 3% increase, girlfriend will usage .03.

Step 2: main point the employee’s present pay rate by the decimal

If her employee provides $15/hour, then you have: 15x.03=.45. So your employee’s increase is 45 cent per hour. Because that an employee who renders a salary of $45,000/year, then you have: 45,000x.03=1,350. So your salaried employee’s pay increase is $1,350 per year.

Why You have actually to transform the Percent

This is just a small theory and not needed to perform the problem.

The percent price is supplied to tell girlfriend something about the number it sit beside. Percent means ‘parts per hundred’. Therefore if a % sign sits beside a 3, it really means 3 parts per 100. Friend don’t need to recognize this to calculate a salary increase however it might aid you to recognize why you need to transform the percent right into decimal type to start with. 3% tells us we should multiply ours pay price by 3 piece of a hundred.

Do girlfriend remember what the decimal locations mean? The first decimal ar is the one per 10 place and also the 2nd is the hundredths place. This is why once we convert our percent we need to move two locations – we have to open increase the hundredths place.

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Automatic pay Raise Calculations

The human Resources papers within the civicpride-kusatsu.net time tracking business calculates pay raise percentage and also keeps document of changes. Record keeping is compelled by the FLSA for every sorts that things regarded payroll.