What does pro rata mean? Worked examples for salary, holiday and bonus

Pro rata means “in proportion”. In pay and HR it means giving someone the share of a salary, a holiday allowance or a bonus that matches the hours they work or the part of the year they are employed.

A £32,000 full-time salary pro-rated to 22.5 hours of a 37.5-hour week is £19,200. A holiday allowance of 28 days pro-rated to a three-day week is 16.8 days. A £1,000 bonus pro-rated to a 0.6 contract is £600. The arithmetic is simple – but the divisor you choose changes the answer, and for holiday there are now two entirely different legal methods depending on the type of worker.

This guide works through each calculation with real numbers, shows where the common errors come from, and flags the parts where getting it wrong creates a legal claim rather than just an awkward conversation.

 

What does pro rata mean?

Pro rata is Latin for “in proportion”. It describes splitting an amount so that each share reflects a measurable input – hours worked, months employed, shares held, days of cover used.

In an employment context you will see it in three places above all others: a salary quoted at its full-time equivalent, a holiday allowance for someone who does not work five days a week, and a bonus for someone who joined or left part way through the year. Outside employment it turns up in dividends, subscription billing, insurance and apportioned overheads.

The word tells you the method, not the number. “£35,000 pro rata” does not mean the job pays £35,000 – it means £35,000 is the full-time rate and the actual salary will be a proportion of it. If an advert does not say what the full-time hours are, you cannot work out the pay, which is why the better adverts say “£35,000 FTE, 0.6 (22.5 hours), actual salary £21,000”.

 

The legal rule behind pro rata pay

Most of pro rata is just arithmetic, but one piece of it is a statutory right worth knowing.

The Part-time Workers (Prevention of Less Favourable Treatment) Regulations 2000 define the “pro rata principle” as meaning that where a comparable full-timer gets pay or any other benefit, a part-timer must receive “not less than the proportion of that pay or other benefit that the number of his weekly hours bears to the number of weekly hours of the comparable full-time worker”.

Three consequences follow, and they are the reason pro-rating is not merely good practice.

It is a floor, not a ceiling. “Not less than the proportion” means you can be more generous, never less.

It applies to benefits as well as salary. GOV.UK’s own example is a bonus: if a full-time worker gets a £1,000 Christmas bonus and a part-timer works half the hours, the part-timer should get £500. Acas puts the same point as part-timers being entitled to the same bonus “on a pro-rata basis”.

Excluding someone is riskier than pro-rating them. A part-timer treated less favourably on the ground of their part-time status can bring a tribunal claim unless the treatment is objectively justified, and compensation is itself assessed by reference to the pro rata principle. In August 2026 the Supreme Court held in Augustine v Data Cars Ltd that part-time status need only be an effective cause of the treatment, not the sole cause – which makes these claims easier to bring and pushes the argument onto whether the employer can justify what it did.

Fixed-term employees have a parallel regime, but a weaker one: their pro rata principle is a test of what is “reasonable in the circumstances having regard to the length of his contract”, not a strict arithmetic ratio, and an employer can defend a less favourable term if the overall package is at least as good.

 

Pro rata salary: worked examples

 

Converting a full-time salary to part-time

Take the full-time equivalent salary, divide the part-time hours by the full-time hours, and multiply.

Full-time equivalent: £32,000 for a 37.5-hour week

Actual hours: 22.5 a week

Proportion: 22.5 ÷ 37.5 = 0.6

Pro rata salary: £32,000 × 0.6 = £19,200

The only thing to be careful about is which full-time week you are dividing by. The same £32,000 against a 40-hour full-time week gives 22.5 ÷ 40 = 0.5625 and a salary of £18,000 – £1,200 less for identical hours. Always state the full-time week alongside the full-time salary.

 

Check the result still clears the minimum wage

Pro-rating a salary does not relieve you of the minimum wage. It is an hourly floor tested in each pay period, on the hours actually worked.

£19,200 ÷ (52 weeks × 22.5 hours) = £19,200 ÷ 1,170 = £16.41 an hour

That comfortably clears the National Living Wage. But run the check whenever the salary is modest or the hours are long, and run it again on part months, because that is where it usually fails. From 1 April 2026 the rates are:

Band	Rate from April 2026
21 and over (National Living Wage)	£12.71
18 to 20	£10.85
Under 18	£8.00
Apprentice	£8.00

 

One trap worth mentioning: if someone leaves part way through their calculation year, the minimum wage rules can increase the hours attributed to their final pay period. A tightly pro-rated final month divided by an inflated hours figure is the most commonly missed route to an underpayment.

 

A starter or leaver part way through a month

This is where pro rata quietly costs employers money, because there are four defensible methods and they all give different answers.

Take someone on £36,000 a year, so £3,000 a month, starting on 15 September 2026. September has 30 calendar days and 22 working days; from the 15th there are 16 calendar days and 12 working days remaining.

Purpose	Divisor	Note
Daily rate, working-day basis	÷ 260	52 × 5. The usual payroll convention
Daily rate, calendar basis	÷ 365	The Apportionment Act default
Hourly rate	÷ (52 × weekly hours)	1,950 at 37.5 hours; 2,080 at 40

 

A spread of £83.46, or 5.3%, from the same salary and the same start date.

No method is prescribed for payroll purposes, but there is a legal default. The Apportionment Act 1870 treats periodical payments in the nature of income as accruing from day to day, which points at the calendar-day method – and the Supreme Court applied that reasoning in Hartley v King Edward VI College to hold that a day’s pay for an annual-contract employee was 1/365 of salary, not 1/260. That case was about strike deductions for teachers rather than routine starter and leaver payroll, so its reach is arguable, but the Act can only be displaced by an express contractual term.

What actually matters in practice:

• Write the method into the contract or a published policy. An express term displaces the 1870 Act and removes the argument.
• Use the same method for starters and leavers. Using the working-day method one way and the calendar method the other systematically favours one side.
• Prefer a month-specific divisor over a fixed one. A flat ÷365 or ÷260 treats February and a 31-day month unequally against a level monthly salary.
• Apply it consistently across the workforce, or you invite an equal-treatment argument on top of the arithmetic.

Paying less than the contractual entitlement is an unlawful deduction from wages, and absent an express term the entitlement is the calendar-day figure.

 

Converting salary to a daily or hourly rate

There is no single legally prescribed divisor. The conventions are:

Purpose	Divisor	Note
Daily rate, working-day basis	÷ 260	52 × 5. The usual payroll convention
Daily rate, calendar basis	÷ 365	The Apportionment Act default
Hourly rate	÷ (52 × weekly hours)	1,950 at 37.5 hours; 2,080 at 40

 

Note that 260 is a rounding – 2026 actually contains 261 weekdays. And do not reuse your payroll divisor for holiday pay, which has its own statutory rules, or for minimum wage hours, which are calculated under their own regime. Borrowing the salary divisor for holiday pay is a common source of underpayment.

 

Pro rata holiday: worked examples

Holiday is where the live article on most sites goes wrong, because the entitlement is expressed in weeks and almost everyone converts it to days too early.

Every worker is entitled to 5.6 weeks of paid annual leave: four weeks under regulation 13 of the Working Time Regulations 1998 plus 1.6 weeks under regulation 13A, capped at 28 days in total. The cap is why a six-day-a-week worker gets 28 days rather than 33.6.

Two points to clear up first, because both are widely misstated.

There is no qualifying period of service. Leave accrues from the first day of employment. The Working Time Regulations did originally require 13 weeks’ continuous employment, but that was struck out in October 2001 after the European Court held it unlawful. A qualifying period can still lawfully be attached to contractual leave above the statutory minimum, which is probably the kernel of the myth.

And bank holidays are not a separate statutory right. There is no legal entitlement to them off, paid or otherwise, and an employer may count them towards the 5.6 weeks. So the common framing of “20 days plus bank holidays” describes a normal contractual package, not the legal minimum, which is 28 days inclusive.

 

Part-time worker with regular hours

Multiply the days worked each week by 5.6.

Three days a week: 3 × 5.6 = 16.8 daysFour days a week: 4 × 5.6 = 22.4 days

That is the whole calculation, and it is what GOV.UK’s own guidance gives. Do not start from 28 days and take a fraction of it – you will reach the same answer for a five-day comparator and the wrong answer wherever the cap bites.

 

Where the working days are not the same length

“Days” assume every day is the same length. Convert to hours instead.

Someone works 30 hours over four days – say 9, 6, 9 and 6.

Entitlement in days: 4 × 5.6 = 22.4 days

Average working day: 30 ÷ 4 = 7.5 hours

Entitlement in hours: 22.4 × 7.5 = 168 hours

Booking leave in hours means a nine-hour day costs nine hours of the allowance and a six-hour day costs six. Book it in days and the worker either gains or loses depending which days they take off.

 

Starting part way through the leave year

Pro-rate by the proportion of the leave year remaining. In the first year of employment leave is deemed to accrue at one twelfth of the annual entitlement on the first day of each month.

Someone on a 28-day allowance joins on 1 August, with a leave year running 1 January to 31 December – five months remaining.

28 × 5 ÷ 12 = 11.67 days

Then apply the first-year rounding rule: a part day is rounded to the nearest half day, and always up or across, never down. A fraction of more than half a day becomes a whole day, so 12 days.

 

Irregular hours and part-year workers: the 12.07% method

This is the significant change most articles have not caught up with, and it applies to a large slice of the workforce.

For leave years beginning on or after 1 April 2024, a worker who is an “irregular hours worker” or a “part-year worker” no longer gets 5.6 weeks in the ordinary way. They accrue leave in hours, at 12.07% of the hours actually worked, credited on the last day of each pay period.

The definitions are contractual, not factual. An irregular hours worker is one whose paid hours in each pay period are “wholly or mostly variable” under their contract. A part-year worker is required to work only part of the year, with periods of at least a week that they are neither required to work nor paid for. Someone on fixed contractual hours who happens to do variable overtime is not caught.

Where 12.07% comes from: a worker gets 5.6 weeks’ leave out of a 52-week year, leaving 46.4 working weeks, and 5.6 is 12.07% of 46.4.

Hours worked in the pay period: 90

Accrual: 90 × 12.07% = 10.863 hours

Rounding: the fraction is 51.8 minutes, which is 30 minutes or more, so round up

Leave accrued:11 hours

The rounding rule is specific: a fraction of an hour is treated as zero if it is under 30 minutes and as a full hour if it is 30 minutes or more. So 120 hours worked gives 14.484 hours – a fraction of 29 minutes – which rounds down to 14 hours. And 68 hours gives 8.2076, rounding down to 8.

This is worth stating plainly because it reverses the position established in Harpur Trust v Brazel, where the Supreme Court held in 2022 that a term-time music teacher on a permanent zero-hours contract was entitled to the full 5.6 weeks and that the 12.07% method was wrong. Parliament has since enacted the very method the Court rejected, for the workers the case concerned. Brazel is not overruled, though, and still governs two groups: any claim about a leave year beginning before 1 April 2024, and anyone who works less than a full year but does not meet the statutory definitions – most obviously a term-time worker paid a level salary across all twelve months, who arguably is paid for the non-working weeks and so is not a “part-year worker” at all. That point is genuinely unsettled and is where employers are most exposed.

 

Rolled-up holiday pay

For irregular hours and part-year workers only, holiday pay may now be paid as a 12.07% uplift on each payslip instead of when leave is taken.

Pay for the period: 90 hours × £13.50 = £1,215.00

Holiday pay uplift: £1,215.00 × 12.07% = £146.65 Total:£1,361.65

Three conditions. It is optional, not automatic. The 12.07% applies to all remuneration for work done, not just basic pay. And the holiday pay element must be shown separately on the payslip. Paying it this way discharges the obligation to pay for leave – it does not remove the worker’s right to take it.

 

Paying accrued untaken holiday when someone leaves

On termination, you pay for leave accrued but not taken. The statutory formula is (A × B) − C, where A is the annual entitlement, B is the proportion of the leave year that has elapsed, and C is the leave already taken.

Someone with a 28-day allowance leaves on 31 August, in a leave year running 1 January to 31 December, having taken 12 days.

A: 28 days B: 243 days elapsed ÷ 365 = 0.66575

A × B: 28 × 0.66575 = 18.6411 days accrued

Less C: 18.6411 − 12 = 6.6411 days owed

Then convert to money using a week’s pay, not a calendar-day figure. On a £32,000 salary with a five-day week:

A week’s pay: £32,000 ÷ 52 = £615.38

A day’s pay: £615.38 ÷ 5 = £123.08

Payment due: £123.08 × 6.6411 = £817.37

Dividing the annual salary by 365 to get a “day’s pay” here would produce £87.67 a day and £582.23 in total – an underpayment of £235.14 on one leaver. That error appears in a lot of published guidance. A day of annual leave is a working day, so the divisor is working days, not calendar days.

Two further points: there is no rounding down of the accrued figure on termination, and for irregular hours and part-year workers the payment is calculated under their own separate provision rather than this formula.

 

Bank holidays for part-timers

Because there is no statutory right to bank holidays, the fair approach for part-timers is to fold them into a single pro-rated allowance expressed in hours or days and let people book what they need. Giving bank holidays off in addition to a pro-rated allowance advantages whoever happens to work Mondays, which is exactly the kind of hours-based disadvantage the pro rata principle is meant to prevent.

Pro rata bonus: worked examples

Bonuses have almost no statutory framework – the amount and the conditions are contractual – but three areas carry real legal risk.

Part-time workers

The pro rata principle applies to bonuses in the same way as to salary.

Full-time bonus: £1,000

Contract: 22.5 of 37.5 hours, so 0.6

Pro rata bonus: £1,000 × 0.6 = £600

Excluding part-timers from a bonus scheme outright is the highest-risk design. Pro-rating is the safe default. And watch any target the bonus is gated on: if the threshold is set in full-time terms, a part-timer may be unable to reach it, and the argument that the threshold should itself be pro-rated is a reasonable one, though there is no direct UK authority on it yet.

Joiners and leavers

Nothing in law requires a bonus to be pro-rated for part-year service, and nothing prohibits it. Most schemes pro-rate by completed months.

Annual bonus: £4,000

Joined 1 May, bonus year 1 January to 31 December: 8 months

Pro rata bonus: £4,000 × 8 ÷ 12 = £2,666.67

Where someone is both part-time and part-year, apply both fractions:

£4,000 × 0.6 × 8 ÷ 12 = £1,600

A “must still be employed on the payment date” condition is generally enforceable, and the Court of Appeal has upheld one. But there are limits worth knowing. Once a bonus has been declared and quantified it becomes wages, and withholding it is an unlawful deduction – you cannot add the condition after the award. Discretion has to be exercised in good faith and rationally rather than perversely. Timing a termination or using a payment in lieu of notice specifically to defeat a bonus invites a breach of contract or trust-and-confidence argument. And a condition buried in an uncommunicated scheme document is hard to enforce. Spell out the pro-rating rule and the leaver rules in the scheme itself, define good and bad leavers, and pay what you have declared.

Maternity leave: the part you cannot pro-rate

This is the calculation almost nobody gets right, and it is a statutory requirement rather than best practice.

A performance-related bonus may generally be pro-rated to exclude ordinary and additional maternity leave, because bonuses of that kind count as remuneration. But the Equality Act 2010 requires that time worked before the leave, the two weeks of compulsory maternity leave immediately after childbirth, and time after the end of the protected period are all treated as though the employee were at work.

So the bonus year has to be split rather than simply reduced.

Bonus: £6,000 for the year 1 January to 31 December

Worked: 1 January to 31 March = 90 days

Plus compulsory maternity leave: 14 days, which must count

Countable period: 104 days

Bonus due: £6,000 × 104 ÷ 365 = £1,709.59

Pro-rating on time worked alone would give £6,000 × 90 ÷ 365 = £1,479.45. The two weeks are worth £230.14 here, and omitting them is unlawful, not merely mean. Note the compulsory period is four weeks rather than two for factory workers.

A bonus based purely on the organisation’s performance, rather than the individual’s, should be paid in full during maternity leave – withholding it risks a maternity discrimination claim.

Sickness absence: the discrimination risk

Pro-rating a bonus for sickness absence is not prohibited, but where the absence is disability-related it becomes a discrimination question. The leading case involved a £900 bonus withheld automatically from anyone with a formal sickness absence warning, while managers kept discretion over conduct warnings. The tribunal and the Employment Appeal Tribunal found discrimination arising from disability, and the fatal flaw was the automatic trigger: because managers had no discretion on sickness, improvement could not be recognised.

If you pro-rate for absence, discount absence attributable to a known disability, disregard pregnancy-related absence entirely, keep and actually use discretion rather than automating the outcome, and record the legitimate aim you are pursuing.

 

Pro rata outside pay

The same proportional logic turns up elsewhere, and the calculations are more straightforward because no employment rights attach.

Dividends are paid per share, so a shareholder with 10 of 10,000 shares receives 0.1% of the distribution. Subscription billing apportions a cancelled or upgraded month by days used. Insurance premiums are refunded for the unexpired portion of cover. Shared overheads such as energy or rent are apportioned between departments or tenants by floor area, headcount or metered usage. Rent on a part month is apportioned by day – and if a lease says rent will be “pro-rated” without saying on what basis, that ambiguity is worth resolving before it becomes a dispute.

 

Common mistakes

• Converting holiday to days before pro-rating. Multiply the working week by 5.6. Do not take a fraction of 28.
• Using 365 as the divisor for a day’s holiday pay. A day of leave is a working day. Use a week’s pay divided by days worked in a week.
• Assuming everyone still gets 5.6 weeks. Irregular hours and part-year workers accrue at 12.07% of hours worked for leave years beginning on or after 1 April 2024.
• Applying 12.07% to fixed-hours staff. The test is contractual. Someone with fixed hours who does variable overtime is not an irregular hours worker.
• Using different part-month methods for starters and leavers. Pick one, write it down, apply it both ways.
• Rolling up holiday pay for the wrong people, or not itemising it. It is available only for irregular hours and part-year workers, and it must appear separately on the payslip.
• Pro-rating a bonus straight through maternity leave. The two weeks of compulsory leave must count.
• Automating a bonus penalty for absence. Automatic triggers are what turn absence-linked bonuses into discrimination claims.
• Advertising “£X pro rata” without the full-time hours. The candidate cannot work out the salary, and neither can you.
• Forgetting the minimum wage check, especially on part months and final pay.

 

In summary

Pro rata is proportion, and for salary it is genuinely as simple as dividing the hours. The complications live in the divisor you pick for part months, in holiday – where the entitlement is in weeks, there are now two separate legal methods depending on the worker, and the wrong divisor for a leaver’s payout understates it by nearly a third – and in bonuses, where the arithmetic is trivial but maternity leave and disability-related absence carry statutory constraints on what you are allowed to take out.

Write your method down, apply it symmetrically, and check the result against the minimum wage. Where a calculation involves family leave, disability or a part-timer being excluded rather than proportioned, take advice before you run the payroll.