How to Track Work Hours and Calculate Pay

Accurate time tracking protects both employees (ensuring correct pay) and employers (payroll compliance, project costing). This guide covers the mechanics of time calculation and pay computation.

Calculating Hours Worked

For a single shift:

Hours worked = End time − Start time − Unpaid breaks

Example: Start 8:45am, end 5:30pm, 30-minute unpaid lunch:

Total clock time = 8h 45min
Less break       = 30 min
Hours worked     = 8h 15min = 8.25 hours

Converting minutes to decimal hours:

Decimal hours = Hours + (Minutes ÷ 60)
8h 15min = 8 + 15/60 = 8.25 hours

Calculating Daily and Weekly Pay

Daily pay   = Hours worked × Hourly rate
Weekly pay  = Sum of all daily hours × Hourly rate

Example: 38.75 hours at £14.50/hour:

Weekly pay = 38.75 × 14.50 = £561.88

Overtime Rules

Overtime pay rules vary by country and employment contract. Common structures:

Hours per week	Pay rate
Up to 40	Regular rate (1× )
40–48	Time and a half (1.5×) — common in US
Above 48	Double time (2×) — depends on contract

UK: The Working Time Regulations cap average weekly hours at 48 (averaged over 17 weeks) unless the worker opts out. There is no statutory legal right to enhanced overtime pay — it depends on your contract.

US: The Fair Labor Standards Act (FLSA) requires 1.5× for hours over 40/week for covered non-exempt employees.

Overtime example: 46 hours worked, £15/hour, first 40 at regular pay, 6 at 1.5×:

Regular pay  = 40 × 15       = £600
Overtime pay = 6 × 15 × 1.5 = £135
Total        =                  £735

Hourly Rate from Annual Salary

Hourly rate = Annual salary ÷ (Hours per week × Weeks per year)

Standard (52 weeks, 37.5 hrs/week):

£42,000 ÷ (37.5 × 52) = £42,000 ÷ 1,950 = £21.54/hour

Exclude holidays if you prefer to calculate based on working days only (typically 228 working days in the UK).

Tracking Methods

Method	Best for	Accuracy
Pen and paper timesheet	Simple fixed schedules	Medium
Spreadsheet	Self-employed, small teams	High if done diligently
Time-tracking app (Toggl, Clockify)	Freelancers, project work	High
Biometric/access card system	Large organisations	Very high

Best practice: Log hours at the end of each day rather than at week's end — memory is unreliable.

Rounding Rules

Some employers round shift times to the nearest 5 or 15 minutes. Under most labour laws, rounding must be applied neutrally — it must benefit workers as often as employers (it cannot systematically short-change employees).

Annual Leave and Bank Holidays

Employees on hourly contracts accrue holiday. In the UK, the minimum is 5.6 weeks (28 days for a 5-day week employee). For part-time or irregular hours:

Leave entitlement = 12.07% × Total hours worked

(5.6 weeks ÷ 46.4 working weeks = 12.07%)

Use the Work Hours Calculator to total any combination of daily start/end times, subtract breaks, and see weekly and monthly totals.