# How to calculate time off liability

To calculate liability for Time Off, you can use the following formula:

**Liability = someone's current Time Off balance in hours x their hourly pay rate**

When calculating liability for salaried workers, first calculate the hourly pay rate for them using the formula below:

**Hourly pay rate = annual salary (in dollars) divided by 2080 hours per year**

## Liability calculation example

- A salaried employee has a current Time Off balance of 80 hours

- The employee earns $52,000 a year.
- The employee's hourly pay rate thus comes out to $25 an hour ($52,000 / 2080 hours).
- The employee's current liability is $ 2 ,000 (80 hours x $25 an hour).