Computing Gross Pay
Employees are paid for the time they work during a pay period. The total amount of money an employee earns in a pay period is the employee’s gross earnings, or gross pay. This is sometimes called salary expense.
The term “gross” means the amount calculated before deduction(s). The calculation of the gross pay is based on the status of the employee.
Full-Time Employees:
When full time employees work within a biweekly pay period, their pay rate is one-half of the actual monthly gross pay. The time worked for gross pay computations includes paid leaves and holidays.
Note:
Gross pay computations for full-time employees change when they work less than a full biweekly pay period, are on a leave-without-pay status, or if their pay rate changes during the pay period.
To compute gross pay you should calculate the ratio of time worked in days or hours to the scheduled time available for work in days or hours for that pay period. (The scheduled time available for work includes paid leaves and holidays.)
In cases of a promotion or a demotion during a pay period, two calculations are done – one for each salary level. Both calculations are based on the percentage of the days or hours worked to total days or hours available for the pay period at each salary level.
In addition to basic salary, gross pay includes pay for all other compensatory services that are available to employees on designated pay dates. Other compensatory services include overtime, assignment pay, call-back, standby, compensatory time, shift differential premium, performance pay, recognition payments, and other special pay provisions as provided for by law, personnel board rules, agency policy or rule, or contract.