Hourly vs Salary: Key Differences

Understand how compensation structure affects pay predictability, overtime, and benefits.

Use /finance/hourly-to-salary-calculator to compare equivalent annuals and factor OT.

Pay structure

• Hourly: paid per hour worked; variable pay
• Salary: fixed pay for a role; predictable income

Overtime and protections

• Hourly: typically overtime-eligible
• Salary: may be exempt (no OT) depending on role/laws

Benefits and stability

• Salary roles often include broader benefits; varies by employer

Example comparison

Hourly $25 × 40 × 50 weeks ≈ $50,000 base; with 5 hrs/week OT, total rises notably

FAQs

Will salary always pay more?

Not necessarily—consistent overtime can make hourly pay higher. Consider total compensation.

What about work-life balance?

Depends on the role. Some salary roles expect more after-hours work without OT.