How to work out pro rata pay for your employees. What is it? Holiday entitlements Almost all workers are legally entitled to 5. Contract of employment A contract of employment is an agreement — written or verbal — between an employee and an employer. How Citation make pro rata easy to grasp If the wheels are spinning just trying to wrap your head around pro rata wages — or you just need a helping hand in getting your HR in order — the Citation team is always here for you.
Share via:. Last name. Email address. Telephone number. Enquire Now. Your data will be processed inline with our privacy policy. For example, if a full-time employee is entitled to 5 weeks of sick leave, a part-time worker who works half the number of hours would be entitled to 2. Business owners can, however, treat part-time workers differently, but only if they have a good reason for doing so. For instance, a part-time employee may not be given health insurance on the grounds that the costs involved are disproportionate to the benefits they are entitled to.
In this scenario, if you do want to offer health insurance, a possible solution would be to share the cost of health insurance costs between your company and the part-time employee. Hiring part-time employees on a pro rata basis can help you cut down on costs, but is it ideal for your business? One of the biggest benefits of hiring part-time employees is reduced payroll costs.
Since part-time workers receive benefits proportional to the hours they work, businesses are ultimately required to spend less on benefits as compared to full-time employees, which further reduces your payroll costs. Part-time employees also offer businesses more flexibility in terms of work hours. For example, you can hire part-time workers to fill in for weekends, evening hours, or festive holidays.
Another key benefit of hiring part-time is that you can acquire the services of skilled employees on a budget. This proficient part-time employee may be able to provide the same or even more value than an average full time one, for a reduced cost.
One of the biggest downsides to hiring part-time employees is that they are at a higher risk of being less committed to your organisation, which can lead to higher turnover rates. Higher turnover rates can be extremely costly for businesses. Another disadvantage of hiring part-time is cohesion amongst your team. If you employ both full time and part-time employees, this could cause a natural divide and make it more difficult to bond as a team.
A good way to combat this possibility is by scheduling regular meetings or social events where both parties are present. This helps them interact with each other via team building activities that work to minimise misunderstandings. For small business owners, hiring part-time employees on a pro-rata basis is an ideal way to cut down on costs and save money. Just make sure you remember to properly calculate pro-rata pay, holidays, and benefits as it can help you stay out of legal trouble.
Ready to start doing what you love? Photo by Ketut Subiyanto, published on Pexels. Lead Talent Partner at Tide. Tide is here to help small business owners and sole traders save time and money. Take a look at our Business Bank Account and get time back to focus on your business. There is a lot of choice for people looking to apply for a loan, and unfortunately there are also many illegitimate and unauthorised lenders that try to scam borrowers. Overall, it's important to read your new pro rata contract carefully, and make sure you're happy with all the terms and conditions.
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What is Pro Rata? If you work three days a week rather than five, for example, your holiday entitlement can be calculated as below: 3 weekly days working x 5. Moving to a Pro Rata Role If you're considering changing jobs to work on a pro rata basis, it's essential that you think about all the factors involved.
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