What is total gross pay?

Total gross pay is the total amount of money an employee has earned before any deductions or taxes have been withheld. It encompasses all forms of payroll payments, including regular wages, overtime, bonuses, and commissions.

How is total gross pay calculated?

To calculate total gross pay:

• For salaried employees: Divide the employee's annual salary by the number of pay periods within the year (e.g., biweekly or monthly).
• For hourly employees: Multiply the number of hours worked by the hourly wage rate.

What is the difference between gross pay and net pay?

Gross pay includes all forms of pay earned by the employee, whereas net pay is the amount the employee receives after deductions (e.g., taxes, retirement contributions, health insurance premiums) have been subtracted from their gross pay.

What are the components included in gross pay?

Gross pay comprises various components, including:

• Regular wages or salary: Base pay for work performed.
• Overtime pay: Additional compensation for hours worked beyond the standard workweek.
• Bonuses: Supplementary payments are often tied to performance or achievements.
• Commissions: Payments are based on a percentage of sales for commission-based roles.
• Shift differential: Higher pay rates for work during non-standard hours or weekends.
• Hazard pay: Additional compensation for employees working in hazardous or high-stress environments.