Saswatabanerjee
Partner - Risk Management
Korgaonkar K A
Ba,llb,mpm,dir&pm,dll&lw,d.cyber
KK!HR
Management Consultancy
Sogemar
Ir Manager
+2 Others

We follow the salary cycle of 1 to 30 or 31st of every month and with the working days and holidays calculation. Holidays we take 4 or 5 Sundays of the month respectively and also we include the proposed holidays (i.e., May day/Diwali, etc) on the deduction part and the rest as working days. We followed this pattern till last month and now from this pay cycle we want to make the salary count from 26th to 25th of each month.
Please suggest with options and procedures.
From India, Chennai

Better solution is to pay as per calendar month with actual attendance cycle taken from 26th of the previous month to the 25th of current month, further with presumed attendance of current month from 26th to the month end. In other words if there is any absence between 26th to the end of the month it will not get reflected in the current month salary but deductions are carried out in the payment of next month salary. For e.g. If an employee absents for 27th April, he will get full salary for April but in the salary paid for the month of May one day salary will be deducted. In this process the salary processing can be smooth and the employee can be assured of smooth payment of salary and better morale and due compliance of the Law.
From India, Mumbai
We do follow same cycle i.e. 26th to 25th. It is helpful for employees , as they get salary in hand by 2nd or 3rd of month. But it is somewhat complex method. : )
From India, Amravati
Dear Gauravf1,
It is better to follow the system of calendar month as suggested by our learned member KK!HR.
The system you follow has many disadvantages where as in calendar month you have not a single disadvantage. In calendar month cycle, if you follow the suggestion by our learned friend KK!HR, you can still make payment any time as per your wish.
From India, Mumbai
Hi
pay cycle change is a really tough task for HR, better to you can proceed as you are following now I.e., calendar wise
From India, Hyderabad
The payroll cycle of 26-25 is illegal under the Payment of wages act
The law requires that the wages be paid for specifically allowed period - week, fortnight or month. If monthly then it needs to follow the Calendar month
From India, Mumbai
Dear Saswata ji,
I would like to know where it is written in Payment of Wages Act that payroll cycle of 26-25 is illegal?
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From India, Mumbai
Dear Saswata ji,
Progress Partners Business Advisory LLP, Mumbai
Internal Audit and Legal Compliance Audits
Twitter : @sasmumbai

Good joke lol...;)
From India, Mumbai
Dear ANNONYMOUS friend,
This is the forum in which we exchange our views and knowledge.
Shri. Saswata Banergee is one of the senior memberd of this forum with nearly 3750 posts in his account. He is most appreciated member by the we readers. He is contributing to the HR Fraternity for so many years consistently without any expectation.
One this background you do not deserve to, and that too hiding the identity, say any thing about him. You proved yourself that you can not even right a single sentence.
From India, Mumbai
There is no need for confusion. The company has to simply follow the Accounting Standards in line with the provisions of Income Tax for TDS, i.e. calender month.
From India, Mumbai
In my current Organization I have been following this calculation( 26th-25th of each month) from past 1 year. During Initial days it was very difficult to calculate because we only pay for working days excluding Sundays and Holidays. But if somebody work in Sunday or Holiday will get extra pay.
The challenges you will come across will be:
1)CL, SL and Earned leave allotment will get imbalance in HRMS portal. Imagine what are you going to do end of Dec month.
2) If you have hire employees with multiple shift type say X employee was working as Part time but suddenly his shift moved from Part time to full time in middle of the month, Salary Calculations will get difficult.
3)In HRMS Portal, every month we need to Finalize the Timesheet to process salary on payroll, to finalize it, portal will pick Calender year automatically.
4) Repetitive Deduction- If someone took leave from 23d to 26th of present month, he will have salary with deduction in current and next month payroll.
There are many more and above challenges are faced by me but now things are somewhat streamline.
I have done multiple coordination with my HRMS team to get the things done according to my Origination requirement.
Now choice is yours.
Regards,
Radhika Joshi
From India, Delhi
We follow the practice as follows.
I) Current Month 1 to 25 actual attendance 26th to Month end assume as Present.
II ) Previous Month's actual 1 to 31 - Less Paid in Previous Month =Difference as Adjustment may positive if filled leave 1 to 25 or negative if remain absent after 25th.
From India, Pune
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