Turn a salary into an hourly rate, or an hourly rate into a salary. Useful for comparing a permanent job against contract or agency work quoted by the hour.
Two things change the answer: how many hours a week counts as full time where you are, and whether paid holiday is treated as working time. Both are shown in the workings.
The short version
- The sum
- Salary divided by weekly hours times 52. At 37.5 hours that is 1,950 hours a year.
- Holiday counts
- A salary pays you through your 5.6 weeks of leave, so those hours are included. A pure hours-worked rate is higher.
- 52 or 52.18
- A year is 52.18 weeks. Almost everyone uses 52, and the difference is about 0.3%.
- Minimum wage check
- Divide total pay by total hours including unpaid overtime. That is the figure that must clear the minimum.
- Umbrella and agency
- A quoted contract rate is usually before employer costs. Compare take-home, not headline rates.
Common questions
How do I work out my hourly rate from my salary?
Divide the salary by your contracted hours for the year — weekly hours times 52. At £30,000 on 37.5 hours a week that is 1,950 hours, so £15.38 an hour. This includes paid holiday, because a salary pays you through it.
Why is my rate different from my payslip?
Usually the weeks. A year is 52.18 weeks, not 52, so a payroll system using the exact figure produces a rate about 0.3% lower. Monthly-paid staff also see variation because months differ in length while the salary does not.
Should paid holiday count in the hours?
For converting a salary, yes — you are paid for those weeks. If you want the rate per hour actually worked, divide by your contracted hours minus your leave, which raises the figure by roughly 12%.
How do I compare a contract day rate with a salary?
Multiply the day rate by the days you would realistically bill, not 260. Contractors have no paid holiday, no sick pay and no employer pension, so a day rate needs to cover all three before it is comparable.
Is my hourly rate what matters for the minimum wage?
What matters is total pay divided by total hours in the pay period, including hours worked beyond contract. A salary that looks comfortable can fall below the minimum once unpaid overtime is counted.
How many hours a year is full time?
At 37.5 hours a week it is 1,950. At 40 it is 2,080, and at 35 it is 1,820. There is no legal definition of full time, so use the figure in your contract.
What the terms mean
- Hourly rate
- Pay for one hour of work. From a salary it is the annual figure divided by contracted hours across the year, holiday included.
- Day rate
- Pay for a working day, common in contracting. Usually quoted for a 7.5 or 8 hour day, so ask which before comparing.
- Annualised hours
- Contracted hours set across the year rather than the week, so a quiet month and a busy one average out.
- Gross pay
- Pay before tax, National Insurance and any deductions. Every figure here is gross.
Guides on this subject
-
Minimum wage: what counts, and how underpayment happens
The rate on your contract is not what the law measures. How the minimum wage is actually calculated, and the…
-
Overtime pay rules in the UK: what you are actually entitled to
There is no legal right to extra pay for overtime in the UK. What your contract controls, and what the…
-
Timesheet rounding rules: when is it legal to round hours?
Rounding clock-in times is common in UK payroll and not automatically unlawful. What makes it lawful, and why rounding down…
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