Payroll, Policy Drafting, Employee Relation,
Dgm - Hr And Admin
Manager - Human Resources
Hr & Admin Officer
Human Resource
+7 Others

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Dear Seniors, Greetings! The calculation of Leave Without Pay, if, done on The Basic or Gross salary. You are kindly requested to give your expert opinion. Thanks Regards Hema
For calculation of Loss of Day all components should be taken means gross salary. For Loss of Hrs only Basic,DA and Spl Allowance should be taken
1. If an employee is taking leave without pay : The amount dedcuted will be same as amount paid whle leave taken with pay. It is Gross Pay what companies take.
2. If an employee go for encashment of leave: This is followed as per letter of appointment / rules of company. Generally companies consider Basic pay in case of encashment of leave, which is unfair but is a fact.
Trust the above information is useful.

Dear All, Is there any provisions which may prohibit companies to encash leaves on Gross Salary instead to Basic Salary.
If you leave Incentive & Sp. Bonus in LOP calculation then employee who takes full month LOP will get the incentive. Actually he should not get any salary. His salary should be 0. In that case Incentive also should be included in the LOP calculation
Hi Hema,
I will explain you with example.
The gross ( BASIC+ HRA+ CONV+ Spcl Allow+.....) = 20000 p.m
Per day it is 666.66/-
if the employee has worked for 29 days then I will pay him 666.66*29 =19333.33/-
Hence, its on gross & not on basic, coz when taken on gross your basic , pf , is attracted automatically.PT will not be affected.
I hope i have tried to make it simple & clear.
Gaurav Vedak

If an employee has been on Leave Without Pay, then the total number of days taken into consideration for computing his salary for the month will be less that many no. of days of LWP.
Total days in the month :31 days
Weekly Off Days : 5 days
Holidays ; 1 day
Days Present : 20 days
LWP : 5 days
Salary for him will be made for only 26 days.
Best Wishes,
Vasant Nair

Hi Hema :
LWP or LOP is usually on the gross salary.
Some org such as ours, considering as a welfare measure, do have a leverage on this wherein for LOP within 5 days, the Basic and DA is only deducted and other components such as HRA, conv etc are not deducted.
Good Luck !!!

Calculation of leave without pay will be calculated on gross salary for e,g :
Gross Salary : 8000/-
Days in a month : 30
Working Days in a month : 26
So Gross Salary would be : 8000/30*26 = 6933.33 or 6934/-
Now Salary Break-up will be calculated on gross salary of 6934/- for the respective month .
M : 9717388549

Dear Hema,
As far as LWP is concerned, it is treated as absent from duty and in that case deduction is made from gross salary except HRA because an employee has to pay house rent for full month either he is on leave with pay or without pay.

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