Enter the base pay, hours worked, and differential rate into the calculator to determine the total pay including shift differential. The calculator will compute the additional earnings from the differential and add it to the base pay for the total compensation.
Shift Differential Formula
The following formula is used to calculate the total pay including shift differential:
TP = (BP * HW) + (BP * DR * HW)
Variables:
- TP is the total pay including shift differential ($)
- BP is the base pay rate ($ per hour)
- HW is the number of hours worked
- DR is the differential rate (%)
To calculate the total pay including shift differential, multiply the base pay rate by the number of hours worked to get the base pay. Then, multiply the base pay rate by the differential rate and the number of hours worked to get the differential pay. Finally, add the differential pay to the base pay to get the total pay.
What is Shift Differential?
Shift differential is additional pay granted to employees who work hours outside the standard workday. Employers may offer shift differential to incentivize workers to cover less desirable shifts, such as night, weekend, or holiday shifts. The differential is typically a percentage increase over the employee’s regular hourly rate.
How to Calculate Total Pay with Shift Differential?
The following steps outline how to calculate the total pay with shift differential:
- First, determine the base pay rate (BP) in dollars per hour.
- Next, determine the number of hours worked (HW).
- Next, determine the differential rate (DR) as a percentage.
- Use the formula to calculate the total pay (TP) including shift differential.
- After inserting the variables and calculating the result, check your answer with the calculator above.
Example Problem:
Use the following variables as an example problem to test your knowledge.
Base pay rate (BP) = $15.00 per hour
Hours worked (HW) = 40 hours
Differential rate (DR) = 10%