How to use the piece rate pay calculator
- List each piece type with its name, the rate per piece and the number of pieces finished. The two rows are examples to replace.
- Enter the hours worked for the period.
- Optionally enter an hourly rate to compare with, taken from your pay policy, contract or the rules that apply to you.
- Read the piece earnings, the earnings per hour and any make-up pay needed to reach the comparison rate.
Formula
Pay for each piece type = rate per piece x pieces, rounded to the cent
Piece earnings = sum of the pay for each piece type
Earnings per hour = piece earnings / hours worked, and make-up pay = comparison rate x hours - piece earnings, if that is above zero
Pay for each piece type is rounded to the cent before the lines are added, as on a pay stub that lists each line separately.
A week of assembly work
Say 212 units are assembled at $1.85 each and 120 orders are boxed at $0.40 each, in 38 hours. The first line is 212 x $1.85 = $392.20 and the second is 120 x $0.40 = $48.00, so piece earnings are $440.20. Earnings per hour are $440.20 / 38 = $11.58, from 8.74 pieces per hour.
If you compare with $15.00 an hour, the guaranteed pay for 38 hours is $570.00. Piece earnings are $129.80 short, so the pay after make-up is $570.00.
How piece rate pay works
With piece rate pay, a worker is paid a set amount for each unit finished instead of for each hour. It is used for work such as assembly, sewing, harvesting and deliveries, where output is easy to count. Pay for one period is the sum of the rate times the number of pieces for each kind of piece. Dividing by the hours worked gives the hourly equivalent, which lets you compare it with an hourly job.
The hourly equivalent depends on the hours you enter. Be consistent about what counts as hours worked, such as the time between pieces, waiting for materials or cleaning up. Whether that time is paid, and how, depends on your employer, your contract and the rules that apply to you.
The comparison rate
Some jobs guarantee that piece pay will not fall below an hourly rate, and some do not. The optional comparison rate lets you test that. If you enter a rate, the tool multiplies it by your hours, and when piece pay is lower, shows the difference as make-up pay. Where the rate comes from is your choice. The calculator does not know your job, your location or any minimum rate that applies, so enter the figure from your own policy, contract or the rules that apply to you.
Overtime, rest breaks, non-working time, bonuses, deductions and taxes are not included. For pay with overtime hours see the overtime calculator, for a full paycheck of earnings the gross pay calculator, and for pay that depends on sales the commission calculator. To compare a yearly figure with hourly pay, use the hourly to salary calculator.
Checking your numbers
Count pieces from your own tally or the production record, and keep rates in the form they are written, such as $0.40, because small rate differences add up over thousands of pieces. If the rate varies by size or quality, list each variation as its own piece type so the total stays accurate. To spot trends, run one calculation for each day or week and compare the pieces per hour.
Assumptions and limits
- Rates are paid for every piece listed and every piece counts. Rejected or unpaid pieces should be left out.
- The comparison rate is optional and comes from you. The tool does not know of any minimum rate that may apply.
- Overtime, breaks, non-working time, bonuses, deductions and taxes are not included.
- Each line is rounded to the cent before they are added.
Frequently asked questions
How do I calculate piece rate pay?
Multiply the rate per piece by the number of pieces finished for each type of work, then add the lines. The tool also divides by your hours to show what that pay works out to per hour.
How do I find my hourly equivalent?
Divide your total piece earnings by the hours you worked. In the example, $440.20 over 38 hours is $11.58 an hour.
What does the make-up pay figure mean?
It is the difference between the hourly rate you entered times your hours and your piece earnings, when piece pay is lower. It only shows what it would take to reach that rate. Whether you are owed it depends on your pay policy or contract.
Can I include more than one kind of piece?
Yes. Add a row for each piece type and rate, up to 20, and the tool adds them together.