A job offer lands in your inbox listing $28 an hour. Another lists $58,000 a year. On paper they look like different currencies — one measured in tiny hourly units, the other in one big yearly number — and comparing them side by side takes a second to feel confident about. Is $28/hour actually more or less than $58,000 a year? Does the salaried job's "no overtime" clause quietly cost you money, or does its paid time off make up for it?
The conversion itself is simple math. What trips people up isn't the arithmetic — it's knowing which number of hours to plug in, whether overtime changes the picture, and why two people earning "the same" pay can end up with very different take-home totals. This guide walks through both directions of the conversion, the mistakes that throw off the math, and when hourly and salaried pay actually behave differently in practice.
To go from hourly to salary, multiply your hourly rate by hours worked per week, then by weeks worked per year — for a standard full-time schedule, that's rate × 40 × 52, or rate × 2,080. To go from salary to hourly, reverse it: divide the annual salary by 2,080 (or your actual annual hours). A $25/hour job is about $52,000 a year; a $60,000 salary is about $28.85 an hour. Overtime and unpaid leave both change the real number.
Hourly vs salary: what's actually different?
Both are just ways of structuring the same underlying thing — pay for work — but they distribute that pay differently, and that difference is the whole reason the conversion matters.
- Hourly pay. You're paid a fixed rate for every hour actually worked. Work more hours in a week, earn more that week; work fewer, earn less. Under the Fair Labor Standards Act (FLSA), most hourly employees are "non-exempt," meaning hours over 40 in a workweek must be paid at 1.5× the regular rate.
- Salaried pay. You're paid a fixed amount per pay period regardless of the exact hours worked that week, as long as you meet the job's expectations. Many — but not all — salaried roles are classified as "exempt" from overtime, meaning no extra pay for longer weeks.
- The 2,080-hour standard. Most conversions assume a standard full-time year: 40 hours a week × 52 weeks = 2,080 hours. It's the baseline the Bureau of Labor Statistics and most payroll systems use, and it assumes no unpaid time off.
- Exempt doesn't mean "salaried automatically." A salary alone doesn't make someone overtime-exempt. Federal law also requires the salary to clear a minimum threshold and the job's actual duties to meet specific tests — a title alone isn't enough.
The practical takeaway: the number itself (hourly rate or annual salary) is only half the story. The other half is how many hours that number actually covers, and whether overtime or unpaid weeks change your real annual total.
Why getting the conversion right matters
A wrong assumption in either direction can make a good offer look bad, or a bad offer look good:
- Comparing job offers accurately. An hourly offer and a salaried offer can't be compared as raw numbers — they have to be converted to the same basis first, or the comparison is meaningless.
- Understanding what overtime is actually worth. A $20/hour role that regularly runs 5 hours of overtime a week earns thousands more per year than the base 2,080-hour figure suggests, since overtime is paid at 1.5× the regular rate.
- Budgeting around real pay, not assumed pay. Freelancers and contractors converting a target salary into an hourly rate need to account for unpaid weeks, since a contractor doesn't get paid holidays the way a salaried employee typically does.
- Spotting misclassification. Employees switched from hourly to a fixed "salary" sometimes lose overtime pay they're still legally owed, since salary alone doesn't create an overtime exemption.
Step-by-step: converting pay in both directions
Hourly to salary
- Confirm your hours per week. Full-time is typically 40 hours, but part-time, seasonal, and contract roles vary — use your actual scheduled hours, not an assumption.
- Confirm your weeks per year. Use 52 if paid holidays and vacation are already included in your pay; use fewer (e.g., 50) only if you take unpaid weeks off.
- Multiply: rate × hours/week × weeks/year. For standard full-time, that's rate × 2,080. A $28/hour role at 40 hours a week, 52 weeks a year, comes to $58,240.
- Add overtime separately, if applicable. Regular overtime should be added on top of the base figure, not blended into the hourly rate, since it's paid at a different rate (1.5×) under the FLSA.
- Sanity-check against take-home. Gross annual salary isn't take-home pay — federal tax, FICA (6.2% Social Security up to the annual wage base, 1.45% Medicare), and any state tax still come out before you see the number in your bank account.
Salary to hourly
- Confirm total annual hours. Use 2,080 for a standard 40-hour, 52-week year, or your own real annual hours if your schedule differs.
- Divide: annual salary ÷ annual hours. A $60,000 salary ÷ 2,080 hours works out to roughly $28.85 an hour.
- Adjust for unpaid time, if relevant. Contractors and freelancers converting a target salary into a billing rate should reduce the annual-hours figure to reflect weeks without pay, or the resulting hourly rate will be understated.
- Remember this is a straight-time comparison. The resulting hourly figure doesn't account for the fact that a salaried role may not pay overtime at all, so it isn't a perfect apples-to-apples stand-in for an hourly job with the same number.
Common mistakes that throw off the math
1. Assuming 40 hours a week for a part-time role
Plugging the standard 2,080-hour figure into a part-time or variable schedule inflates the result significantly — a 25-hour-a-week role needs its own hours-per-year figure, not the full-time default.
2. Forgetting overtime entirely
The base hourly-to-salary formula assumes straight-time pay only. An hourly employee who regularly works overtime can be earning meaningfully more than the 2,080-hour figure suggests, since overtime hours are paid at 1.5× the regular rate under the FLSA.
3. Treating gross pay as take-home pay
The result of either conversion is gross pay, before federal tax, FICA, and any state or local tax. Two people with identical gross salaries can have different take-home pay depending on their state and filing status.
4. Assuming "salaried" always means "no overtime"
Salary and overtime-exemption are two separate legal concepts. A salaried employee earning below the applicable federal or state salary threshold, or whose duties don't meet the exemption tests, can still be legally owed overtime pay.
Real-world examples
How the same conversion formula plays out across different schedules and pay levels:
Notice how the hourly-plus-overtime example lands close to the flat $50k-range salaried example — on paper they can look similar, but one includes built-in overtime pay and the other typically doesn't.
Hourly pay vs salaried pay compared
Neither structure is universally "better" — the right fit depends on how stable your hours are and whether overtime is realistic for your role.
| Factor | Hourly pay | Salaried pay |
|---|---|---|
| Overtime eligibility | Usually eligible | Depends on exemption status |
| Pay consistency week to week | Varies with hours actually worked | Fixed per pay period |
| Effect of a slow week | Lower paycheck that week | Usually unaffected |
| Effect of a long week | Higher paycheck, often at 1.5× past 40 hrs | Often no extra pay if exempt |
| Typical benefits bundling | Varies by employer | Often included |
| Easiest to convert accurately | Needs real weekly hours + OT data | Needs real annual-hours assumption |
Convert your pay right now — free
The Rebrixe Hourly to Salary and Salary to Hourly calculators handle custom weekly hours, unpaid weeks, and overtime, so you're not stuck manually adjusting the standard 2,080-hour formula.