Why Pay Period Conversions Confuse People
A job offer of "$30 an hour" and a salary of "$62,400 a year" can describe the same compensation — or wildly different ones, depending on how many hours and weeks are actually worked. The gap between an hourly rate and an annual salary is not a single fixed multiplier; it depends on your schedule. This is why job seekers, contractors, and HR teams repeatedly need a reliable way to convert between periods.
The core relationship is simple: annual = hourly × hours per week × weeks per year. Everything else — monthly, weekly, bi-weekly — is just the annual figure sliced into different numbers of pay periods. Getting the conversion right means being explicit about the schedule, which most quick mental estimates skip.
The Standard Conversions
Hourly to annual: Multiply your hourly rate by hours per week, then by weeks per year. At the common US default of 40 hours and 52 weeks, $30/hour = 30 × 40 × 52 = $62,400 per year.
Annual to hourly: Divide annual pay by (hours per week × weeks per year). A $62,400 salary at 40/52 works out to exactly $30/hour. The same salary at 35 hours a week is $34.29/hour — the schedule changes the answer.
Annual to monthly: Divide by 12. Note that a "month" of pay is not four weeks; it is the annual figure divided into twelve equal parts, which is about 4.33 weeks.
Annual to bi-weekly: Divide by 26 (there are 26 two-week periods in a year). This is different from twice the monthly figure — a frequent source of payroll confusion. Some years contain 27 bi-weekly pay dates, which is why bi-weekly employees occasionally see a "third paycheck" month.
Annual to semi-monthly: Divide by 24 (twice a month, on fixed dates). Semi-monthly and bi-weekly are not the same: 24 versus 26 pay periods produces different per-check amounts for the same salary.
Hours, Weeks, and the Schedule Trap
Full-time in the United States is conventionally 40 hours per week across 52 weeks, but many real schedules differ. A salaried worker who takes two unpaid weeks effectively works 50 weeks. A part-time role at 25 hours per week dramatically lowers the annual equivalent of a given hourly rate. Teachers, seasonal staff, and freelancers frequently work far fewer than 52 paid weeks. Any honest conversion must let you set these values rather than baking in 40/52.
The "work days per year" figure (weeks × days per week) is useful for daily-rate contractors. At 52 weeks and 5 days, that is 260 working days; subtract holidays and vacation to get your real billable days.
Overtime and the 1.5× Rule
Under the US Fair Labor Standards Act, non-exempt employees must be paid at least 1.5× their regular rate for hours worked beyond 40 in a workweek. If you earn $20/hour and work 50 hours, the first 40 hours pay $800 and the 10 overtime hours pay 10 × $20 × 1.5 = $300, for a total of $1,100 that week. Overtime is calculated weekly, not by pay period — averaging hours across two weeks of a bi-weekly period to avoid overtime is not permitted for covered employees. Exempt salaried roles and rules outside the US differ, so always check your jurisdiction.
Gross Pay vs. Take-Home Pay
Every figure above is gross pay — what you earn before deductions. Your actual take-home is lower. In the US, the employee FICA share is 6.2% for Social Security (up to an annual wage cap) plus 1.45% for Medicare, totalling 7.65%. On a $62,400 salary that is roughly $4,774 a year before any income tax. Federal income tax, state tax, health premiums, and retirement contributions reduce take-home further. This tool's optional FICA estimate covers only that 7.65% payroll-tax slice; it is not a full paycheck calculator, and it does not model income-tax brackets or the Social Security wage cap.
Using Conversions When Comparing Offers
When you compare a contract hourly role against a salaried one, convert both to the same period and the same schedule before deciding. A $45/hour contract sounds better than a $80,000 salary, but at 40/52 the contract is $93,600 gross — yet contractors usually pay both halves of FICA (15.3% self-employment tax) and receive no paid leave or benefits. Convert to a like-for-like annual figure, then adjust for benefits and self-employment tax to compare honestly.