Everhour tracks approved hours for payroll handoff, while gross pay starts with wages earned before taxes and deductions.
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Gross pay answers one practical question: how much did the worker earn for the pay period before employee withholding and deductions. For hourly workers, that starts with hours worked times the pay rate. For salaried workers, it starts with the salary amount assigned to the pay period. For covered nonexempt employees, overtime must be separated when hours worked exceed 40 in a fixed 168-hour workweek under the federal FLSA baseline.
The result is not take-home pay. U.S. employers calculate federal income-tax withholding from Form W-4 and IRS Publication 15-T after gross wages are known. Employee Social Security, Medicare, and any Additional Medicare withholding also come later. Employer taxes such as FUTA, matching Social Security and Medicare, and state unemployment belong outside the employee gross-pay result.
For hourly pay, multiply regular hours by the regular hourly rate, then add overtime, double time, bonuses, commissions, and paid leave amounts that the employer provides. The federal overtime baseline requires covered nonexempt employees to receive at least 1.5 times the regular rate for hours worked over 40 in one workweek. Paid vacation, sick leave, and holidays are not required by the FLSA, but provided vacation pay is withheld as wages.
For example, a covered nonexempt employee earns $26 per hour and works 47 hours in one workweek. Regular pay is 40 hours times $26, or $1,040. The overtime rate is $39 per hour, and 7 overtime hours add $273. Gross pay for the week is $1,313 before federal income-tax withholding, employee Social Security, employee Medicare, benefits deductions, or state withholding.
A common payroll mistake is mixing gross wages with taxable wages or net pay. Gross pay measures earned compensation before reductions. Taxable wages can change after pre-tax deductions, and net pay changes again after withholding and post-tax deductions. A $1,313 gross weekly check can produce a different net amount for two employees with the same hours because Form W-4 elections, benefits, state withholding, and year-to-date wage caps differ.
The 2026 Social Security employee tax applies at 6.2% only up to the $184,500 annual wage base, while Medicare applies at 1.45% to all covered wages with no wage-base limit. Employers must begin 0.9% employee-only Additional Medicare Tax withholding in the pay period when wages paid to an employee exceed $200,000 for the calendar year. These rules affect withholding, not the gross-pay number itself.
A one-off gross pay calculation is enough when you need to check one hourly shift, estimate a salary paycheck, or verify a bonus before payroll entry. It works best when the hours, rates, overtime category, and paid leave amounts are already final. The calculation becomes fragile when managers revise time after approval, contractors bill from different projects, or payroll needs a repeatable audit trail.
Everhour fits the managed workflow side by moving approved time entries into Deel for contractor payroll on pay-as-you-go contracts. The integration exports approved entries one way, can merge daily entries, and can group them by task, project, or both before sending. A period cannot be exported twice, so teams get a cleaner handoff when gross pay depends on approved time records.
This content is for general information only, may not be fully up to date, and is provided without any warranty or liability.
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Gross pay is the compensation earned before payroll deductions. Taxable wages are the portion subject to a specific tax after allowed pre-tax deductions and wage-base rules. For example, a traditional 401(k) deduction can reduce federal income-tax withholding wages, while Social Security and Medicare treatment follows separate rules. Net pay comes after withholding and deductions.
Overtime belongs in gross pay when the worker earned it for the pay period. Under the federal FLSA baseline, covered nonexempt employees must receive at least 1.5 times the regular rate for hours worked over 40 in a fixed 168-hour workweek. Payroll should calculate the premium before subtracting tax withholding or benefit deductions.
Provided vacation pay belongs in gross pay because it is paid as wages. The FLSA does not require pay for time not worked, including vacation, sick leave, or holidays. Once an employer provides paid vacation, that amount is subject to withholding as regular wages or as supplemental wages when paid as an additional lump sum.
Use the actual pay period used by payroll: weekly, biweekly, semimonthly, or monthly. The United States does not set one national private-employer payday frequency. State payday rules control timing, and withholding tables in IRS Publication 15-T depend on the payroll period used for the wage payment.
Bonuses increase gross pay when they are paid for the period. Separately identified supplemental wages may use a flat 22% federal withholding rate when regular-wage income tax was withheld, and supplemental wages above $1 million in a calendar year require 37% withholding on the excess. Those withholding rules come after the bonus is included in gross wages.
Everhour's Deel integration exports approved time entries one way into Deel for contractors on pay-as-you-go contracts. Exports can keep entries separate or merge daily entries, grouped by task, project, or both, with a preview before sending. Each period can be exported only once from Everhour.
Everhour timesheets collect project hours and working hours by person so managers can approve, reject, partially approve, and lock time before payroll review. Submitted and approved time is protected from regular member edits, which gives payroll a clearer hours record before gross pay is calculated.
Move approved contractor time from Everhour into Deel with grouped export options and one-export-per-period controls, giving payroll a cleaner handoff from tracked hours to contractor payouts.
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