Need Clarification On LWP Calculation - CiteHR
AxitaMehta Executive
Executive - Hr
+2 Others

Cite.Co is a repository of information created by your industry peers and experienced seniors sharing their experience and insights.
Join Us and help by adding your inputs. Contributions From Other Members Follow Below...
Dear Seniors,
Can anyone tell me that if the LWP calculation is to be done on Gross salary or on (Basic+ DA) as per the companies act.
The leave encashment is to be done Gross or on (Basic + DA).
As in the company where I work, currently the LWP is calculated on the gross salary. a matter is comming up that 'if the leave encashment is done on the (Basic + DA) then the LWP calculation should also be done on the same basis.
please advice me in this matter.

Dear Piyali, The salary for the unpaid days is deducted from the gross salary & the salary in lieu of leaves is paid on Basic + DA only as per the govt. organizations.
Dear Piyali,
In case of LWP we need to deduct one day salary from the Gross Salay (Clear and Simple)
Case - I (Leave Encashment)
But we consider Leave Encashment on Basic + DA because Notice Period will be considered on Basic + DA only.
Case - II (Leave Encashment)
If at the time of leaving notice period will be considered on Gross Salary then Leave Encashment must be considered on Gross Salary.
Chill HR

If the encashment of leave is as per Sec 79 of the Factories Act,then the worker shall be paid wages @ his full average wages u/s 80.ILogically the rate of wages in such cases shall be the same at which he is paid for the days he avails leave.In other cases of leave encashment Co can have a defferent formulae ie,encashment while in service.
Varghese Mathew
Baseindia Consultants
Trivandrum 14.(9961266966)

Dear Piyali , This is regards your query ,we have to Calculate the LWP on gross salary only not on Basic+D.A. Regards Raju
LWP is calculated on Gross Salary and not on BASIC + DA.
If, an organisation considers BASIC + DA are the only components, employee will continue to draw other allowances/ components of the Salary. In such situation employees will go for LWP regularly and absentism will hamper the regular working. No Organisation will encourage such practices.
Hence, entire Gross Salary has to be taken for calculation of LWP.

LWP is on GPM because it one day Salary. (Basic+DA)that is the case on what ground you are going to give other Salry heads like HRA,Medical,Conynce etc. Mshegde.
Hi Everybody, Can you tell me as per Labor law, what is probation period ? What is percentage of Basil salary in gross?
There is no law on probation period except if any provided under the certified standing orders.
This discussion thread is closed. If you want to continue this discussion or have a follow up question, please post it on the network.
Add the url of this thread if you want to cite this discussion.

About Us Advertise Contact Us
Privacy Policy Disclaimer Terms Of Service

All rights reserved @ 2020 Cite.Co™