How to Convert Time for Payroll

How to Convert Time for Payroll
Converting time to payroll requires accuracy and the right methods

Owning a small business brings a lot of small responsibilities that can add up to real-time consumers. If you process the payroll of your company yourself and have to pay employees hourly this is definitely one of those items that can take some effort. It requires a person to remember their basic math and convert time to decimals. This is needed in order to calculate the correct pay for any pay period. Once the number is converted to a decimal then it is a simple multiplication of that number by the pay per hour. Those wages sound easy to calculate but in practice, there are a few things to remember when tracking the hours worked on their time sheets.

How to Convert Time for Payroll

  1. Round Down or Up for Easier Tracking
  2. One practice that many use in keeping track of hours and converting to a decimal is to round the total to the nearest quarter-hour. This saves a lot of effort for many payroll clerks and being a small business owner, this will save you effort as well. It begins by adding up the employees minutes then divide those by 15 (a quarter of an hour). Then simply see if there is any remainder. If the remainder is 1-7 then round down. However, if the remainder is between 8-14 then round up. This simple conversion can save some significant work.

  3. Complete Decimal Conversions
  4. Transforming minutes to decimals follows the same process, whether you pay the exact minutes or round to the nearest quarter. Each hour has a decimal value of one and the minutes worked are divided by 60, the formula looks like this, Minutes Worked /60. This will give you a decimal value. The example is and the employee works 5hours and 46 minutes. Divide 46 by 60 and you will get a decimal value for that pay period of 0.77, and the total decimal value of hours worked is 5.77. Multiply that number by the hourly wage and you will determine accurately the gross pay off your employee.

  5. Use a Chart for Quick Time Sheets Completion
  6. If your company only has a few employees this can be done using a calculator or old-fashioned adding machine. Of course in the age of information, it is easy to find a chart that will provide the standard decimal values for all hours worked. It is a great way to cut down on the time it takes to calculate the pay. If you are rounding to quarters then the chart is much shorter and eventually, you will probably be able to commit it to memory. Here is a short chart with Standard Decimal Values: 15/60=.25, 30/60=.50, 45/60=.75, and of course 60/60=1.00.

  7. Use Spreadsheets To Be More Efficient
  8. Learning to use spreadsheets can be an extremely quick way to convert minutes to decimals. This reduces human error and calculations are done quickly. In column A, place employee hours. In Column B, place minutes worked. Then in column C apply the formula to the minutes that your prefer and the calculations will be produced automatically. Here is a formula to apply to column C, =((A1*60)+B1)/60 A1*60. Doing this will automatically do the math for exactly the amount worked. If you want to round to quarters then there is a simple formula for that as well which is, =((ROUND(((A1*60)+B1)/15;0))*15)/60.

Hopefully, by using this quick and simple advice, all of your payroll calculations will be a very small distraction from now on. There is no need for pay issues to take up an incredible amount of your effort, and as a small business owner, you can start using your efforts to increase sales, or bring in more clients.

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