How to Calculate a Pay Raise

It is always cause for celebration when an employee receives a pay raise for a job well done. Typically, the boss will tell the employee of the pay raise in one of two ways. He will either provide the amount of the new salary or the percentage increase. For these two options, the employee can calculate the other measure.

Start your calculations with the employee's original salary and new salary. For example, an employee makes £26,000 and his boss gives them a raise to £29,250.

Subtract the original salary from the new salary. In this example, £29,250 minus £26,000 equals £3,250.

Divide the difference between the salaries by the original salary. In this example, £3,250 divided by £26,000 equals 0.125 or a 12.5 per cent raise.

Start your calculations with the per cent of the raise and the original salary. For example, an employee's boss tells the employee he will receive a 12.5 per cent raise from his £26,000 salary.

Multiply the per cent increase in salary by the original salary. In this example, £26,000 times 12.5 per cent equals £3,250.

Add the original salary to the number calculated in Step 2. In this example, £26,000 plus £3,250 equals a new salary of £29,250.

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About the Author

Carter McBride started writing in 2007 with CMBA's IP section. He has written for Bureau of National Affairs, Inc and various websites. He received a CALI Award for The Actual Impact of MasterCard's Initial Public Offering in 2008. McBride is an attorney with a Juris Doctor from Case Western Reserve University and a Master of Science in accounting from the University of Connecticut.

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