Pro-Rata - Daily Rate Difference
The Pro-Rata method for Daily Rate Difference allows you to specify how many days you would like the daily rate to be calculated using. When selecting Daily Rate Difference, you can enter the number of days in the field to the right.
Entering 260 here would calculate the daily rate using 260 days for all employees on the next synchronisation - (Annual Salary / 260)
Entering 208 here would calculate the daily rate using 208 days for all employees on the next syncrhonisation - (Annual Salary / 208)
Important - the number of days entered will be used to calculate the daily rate for all employees on the next synchronisation, regardless of employee working pattern. Further changes will be released in the future to calculate the daily rate using an employee working pattern.
The calculation for the adjustment is worked out as follows:
Daily Rate = Annual Salary / number of days entered
Adjustment - Current Period = (Old daily rate - New Daily rate) * Days at Old Rate
Adjustment - Historical = (New daily rate - Old Daily rate) * Days at New Rate
-----------------------------------------------------------------------------------------------------------
Current Period Change - Example using 260 days for an employee working 5 days per week
Scenario: A monthly paid employee currently earning £35,000 per year in 2025/26 has a pay rise, increasing salary to £38,000 per year effective from 14/11/2025
The Payroll Calendar for November starts on 1st November and ends on 30th November.
Annual Amounts
Old Period Amount = 35,000
New Period Amount = 38,000
Period Amounts
Old Period Amount = 35,000 / 12 = 2916.667
New period Amount = 38,000 / 12 = 3166.667
Number of Days
The employee's working calendar is Monday - Friday each week. The number of working days in the period for November = 20.
Days at old Rate = 9
Days at new rate = 11
Daily Rate
Old Daily Rate = 35,000 / 260 = 134.6154
New Daily Rate = 38,000 / 260 = 146.1538
Adjustment Calculation:
Current Period = (Old daily rate - New Daily rate) * Days at Old Rate
Step 1 - Calculate Daily rate difference - 134.6154 - 146.1538 = -11.5385
Step 2 - Number of days at old rate = 9
Step 3 - Payroll Adjustment = -11.5385 * 9 = -£103.85 (rounded up)
-----------------------------------------------------------------------------------------------------------
Historic Period Change - Example using 260 days
Scenario: A monthly paid employee currently earning £35,000 per year in 2025/26 has a pay rise, increasing salary to £38,000 per year effective from 10/11 2025. The payroll run date in January is 30/01/2026
The Payroll Calendar for November starts on 1st November and ends on 30th November.
The Payroll Calendar for December starts on 1st December and ends on 31st December
Period Amounts
Old Period Amount = 35,000
New period Amount = 38,000
Number of Days - November
The employee's working calendar is Monday - Friday each week. The number of working days in the period for November = 20.
Days at old Rate = 5
Days at new rate = 15
Daily Rate
Old Daily Rate = 35,000 / 260 = 134.6154
New Daily Rate = 38,000 / 260 = 146.1538
Adjustment Calculation - November:
Historic Period = (New daily rate - Old Daily rate) * Days at New Rate
Step 1: Daily Rate Difference 146.1538 - 134.6154 = 11.538
Step 2: Days at New Rate = 15
Step 3: Adjustment = 15 * 11.5438 = 173.08 (rounded up)
Adjustment Calculation - December
As there is no pro-rata adjustment required for December, the adjustment is calculated by deducting the old period value from the new period value:
Step 4: 3166.66 - 2916.66 = £250
Total Payroll Adjustment - January
The total adjustment to be paid in January payroll = (November Adjustment + December Adjustment)
Step 5: £250 + 173.80 = 423.08
----------------------------------------------------------------------------------------------------------
New Starter
Scenario: A monthly paid employee currently earning £35,000 per year in 2025/26 commences employment on 12/11/2025.
The Payroll Calendar for November starts on 1st November and ends on 30th November.
Daily Rate = Period Amount / number of days entered
Current Period = (Old daily rate - New Daily rate) * Days at Old Rate
Annual Amounts
New Period Amount = 35,000
Period Amounts
New period Amount = 35,000 / 12 = 2916.667
Number of Days
The employee's working calendar is Monday - Friday each week. The number of working days in the period for November is 20 days.
Days Not Worked = 7
Daily Rate
Daily Rate Calculation - Period Amount / number of working days in pay period
New Daily Rate = 35000 / 260 = 134.6154
Adjustment Calculation:
Current Period = (Old daily rate - New Daily rate) * Days at Old Rate
Step 1 - Calculation for Days Not Worked at old rate = 134.62 * 7 = 942.3078
Step 2 - Payroll Adjustment = -942.31 (rounded up)
--------------------------------------------------------------------------------------------------------
Leaver
Scenario: A monthly paid employee currently earning £35,000 per year in 2025/26 leaves employment on 21/11/2025.
The Payroll Calendar for November starts on 1st November and ends on 30th November.
Daily Rate = Annual Salary / number of days entered
Current Period = (Old daily rate - New Daily rate) * Days at Old Rate
Annual Amounts
New Period Amount = 35,000
Period Amounts
New period Amount = 35,000 / 12 = 2916.667
Number of Days
The employee's working calendar is Monday - Friday each week. The number of working days in the period for November is 20 days.
Days Not Worked = 5
Daily Rate
Daily Rate Calculation - Period Amount / number of working days in pay period
New Daily Rate = 35,000 / 260 = 134.6154
Adjustment Calculation:
Current Period = (Old daily rate - New Daily rate) * Days at Old Rate
Step 1 - Calculation for days at old rate = 134.6154 *5 = -673.077
Step 2 - Payroll Adjustment = -673.08 (rounded up)