What is partial pay?

Partial pay is pay for only part of a pay period, such as a first week, a last week or a period with unpaid leave. For salaried exempt employees, federal rules limit when pay can be reduced.

In shortPartial pay covers any paycheck for less than a full period’s normal pay: a new hire who starts mid-period, an employee who leaves mid-period, or a period with unpaid time off. For hourly employees it is simple, since they are paid for hours worked. For salaried exempt employees, the salary basis rules apply. Under 29 CFR 541.602(b), an employer may deduct for absences of one or more full days for personal reasons other than sickness or disability, may pay a proportionate part of the salary for time actually worked in the initial and terminal weeks of employment, and may pay a proportionate part for unpaid FMLA leave. Partial-day absences for personal reasons cannot be deducted.

Hourly vs. salaried exempt

When partial pay applies
Situation	Hourly	Salaried exempt (federal)
Starts mid-week	Hours worked	Proportionate pay allowed in the first week
Leaves mid-week	Hours worked	Proportionate pay allowed in the last week
Full day off, personal	Not paid	Full-day deduction allowed
Half day off, personal	Not paid	No deduction
Unpaid FMLA leave, hours	Not paid	Proportionate deduction allowed

State law can be stricter, and final pay timing is set by state law. See final paycheck rules.

To total hours with breaks and overtime, use our time card calculator.

A full personal day can be deducted. The half day cannot.

Worked example: an exempt manager’s first and later weeks

Salary of $1,200 a week

An exempt assistant manager earns $1,200 a week, Monday to Friday. She starts on a Wednesday. In her first week, the employer may pay for the time actually worked: 3 of 5 days, or $720.

Months later she takes a day and a half off for personal reasons. The employer can deduct only the full day, $240, and must pay the half day. Later still, she takes 4 hours of unpaid FMLA leave in a 40-hour week; the employer may deduct a proportionate 10 percent, or $120.

The rule that trips employers is the half day. Deducting it would be an improper deduction, and under 29 CFR 541.603 a practice of improper deductions can cost the exemption, turning salaried pay into a question of unpaid overtime.

Mistakes that are specific to partial pay

Docking an exempt employee’s salary for a partial-day personal absence.
Paying a new exempt hire a full week after one day of work, then trying to recover it.
Prorating by calendar days when the policy says workdays, or the reverse, without a written method.
Missing the state deadline for a final paycheck because it was a partial period.
Treating a week when an exempt employee did any work as a week with no pay due.

Building partial pay into payroll

Most partial pay errors come from payroll defaults. A system set to pay the full salary every period will overpay a new hire’s first week and a leaver’s last; one set to deduct any absence can make an improper partial-day deduction for an exempt employee. Write down how each case is handled, and check the first and last paychecks of every salaried employee by hand.

For daily rates, pick a method and use it consistently: weekly salary divided by the number of workdays in the week is common. Keep a note of the calculation on each partial check, so the employee and payroll can follow it.

Second example: an hourly employee’s final period

An hourly cashier at $17 leaves on a Wednesday in the middle of a biweekly period. She worked 32 hours in the first week and 16 in the second.

Her final pay for the period is 48 hours times $17, or $816, plus any PTO payout owed under state law and the company’s policy. Payroll issues it on the date her state’s final pay rule requires, which may be earlier than the regular pay date.

Write the proration method down onceChoose one way to prorate salaries, by workdays or by calendar days, and write it in the payroll policy with an example. Most partial pay disputes are about method, not the law.

Questions people ask

Can an employer pay a salaried employee for a partial week?

In the first and last weeks of employment, yes, proportionate to time actually worked. Other partial weeks depend on why the employee was absent.

Can you deduct a half day from an exempt employee’s salary?

Not for personal reasons. Federal rules allow deductions for full-day personal absences, and proportionate deductions for unpaid FMLA leave.

How is partial pay calculated?

For hourly employees, hours worked times the rate. For salaried staff, usually the salary divided by the workdays in the period, times days worked. Use one written method.

Is partial pay the same as prorated pay?

They are often used the same way: pay reduced in proportion to the time worked.

How do you calculate a daily rate for a salaried employee?

A common method is weekly salary divided by the number of scheduled workdays in the week. Use the same method for everyone.

Can an employer deduct pay for a salaried employee’s late arrival?

For an exempt employee, generally no, because partial-day deductions for personal reasons are not allowed under the salary basis rules.

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Disclaimer: What you read here about partial pay is general information, not legal, payroll or tax advice, so confirm the current rule where you operate; the examples are fictional.