How are salaries prorated in the United Kingdom (UK)?

Prorated salaries are typically necessary when an employee starts or ends their employment relationship mid-month. In these situations, the employee is only compensated for the actual days worked within that partial month. This ensures that the employee is paid fairly and accurately, reflecting the precise amount of time they have worked.


Steps Horizons takes to accurately Prorate a Salary:

  1. Calculate the Daily Rate:

    • To determine the daily rate, divide the annual salary by the average number of working days in a year, typically 260 days.
    • Example: For an annual salary of £36,000, the calculation would be:
      £36,000 ÷ 260 = £138.46 per day.

  2. Calculate the Prorated Salary:

    • Multiply the daily rate by the number of days worked in the specific month.
    • Example: If an employee worked 15 days in the month, the calculation would be:
      £138.46 × 15 = £2,076.92.


By following this method, employers can ensure that employees are paid accurately based on the actual number of days worked during their first or last month of employment, providing fair compensation in these specific circumstances.

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