Salary is typically only one component of a remuneration package an organization might offer to a job candidate. Remuneration packages usually include salary, bonuses, sick time, paid vacation, retirement plans and health, disability and life insurance contributions. Extra perks such as free gym memberships or paid travel to professional conferences may also be considered when calculating total remuneration.
Salary, of course, is the fixed amount you are paid for your employment. If you earn $3,000 a month, then your total annual salary is $36,000. If you work full-time and are paid hourly, you can determine your monthly salary by multiplying your hourly wage times 175. (The standard calculation for annual pay is 40 hours a week times 52 weeks, which equals 2080, divided by 12 months. That equals 173.3 hours per week, rounded to 175). For example, 175 x $20 per hour equals $3,500 a month.
Bonuses and Extra Perks
You also have to include bonuses and the value of any extra perks when calculating total remuneration. Sometimes bonuses are conditional on meeting certain goals, so you might have to make some assumptions when calculating bonuses. It is generally a good idea to be conservative and only assume you will achieve the lower rungs of a bonus plan. Perks also count towards total remuneration. Say, for example, your company pays for your gym membership. That might only be $50 a month, but that adds up to another $600 in total annual remuneration.
Paid Time Off
Paid time off is another important category. Some companies offer separate sick leave and paid vacation; others combine both into a single category of paid time off. In either case, you can calculate the value of the paid time off by multiplying the total number of weeks of paid time off by your weekly salary. If your weekly salary is $580, for example, and you receive five sick days and two weeks of paid vacation annually, that is three weeks times $580, or $1740 more to include in total remuneration.
Employer contributions to retirement plans, such as pensions or 401k plans, also count in determining total remuneration. Assuming your employer has a five percent 401k match, if you earn $3,000 a month and contribute five percent of your salary, or $150, then your employer will match that $150 and deposit $300 in your 401k account. In effect, you are being paid an additional $150 a month, and the amount should be included in your total remuneration.
Insurance premiums paid by your employer are another form of remuneration. Not all employers pay health and/or disability insurance premiums, but many do. Some employers pay all of your health insurance premium, but most just pay between 50 to 80 percent of your insurance premium. If your insurance premium is $400 a month and your employer pays 75 percent, that is another $300 a month in remuneration.
- Thinkstock/Comstock/Getty Images
- Ways to Confront a Boss About a Salary
- What Is Nonemployment Compensation?
- What Is a Fixed Hourly Rate of Pay?
- Do Employees Have to Sign Anything When They're Laid Off?
- What Is an Incentive Paid to a Salesperson?
- Are CEOs Paid What They Are Worth?
- Salary vs. Hourly Employee Sick Days
- Iowa Wage Garnishment Guidelines