When working with hourly paid employees, Bob can normalize their hourly rate into an annual rate. This annualized value is used in compensation events and reports.
The calculation is:
- Hourly rate × weekly hours × 52 = annual rate
For example, if an employee has an hourly rate of 20 and works 40 hours per week, the calculation would be:
- 20 × 40 × 52 = 41,600
The employee's normalized annual rate would therefore be 41,600.
