Confused About Salary Calculations and Leave Policies? Seeking Guidance from Experienced HRs

Hi Seniors,

I am a newly joined HR Assistant in a private company with around 150 employees. Regarding the salary calculation, my company follows a 26-day calculation and excludes weekly offs. They provide earned leave after completing 240 days and divide the salary into three parts (basic, DA, other allowances) adhering to the local minimum wages act.

For example:
Whatever the total days for that month, we derive the payable days calculation as below. Let's assume a person receiving Rs. 5000 (BP 2500, DA 550, OA 1950).
Payable days = 26 - (Absent or loss of pay) ... here, the weekly off, national holidays, and EL days are excluded.
Total BP = 2500 / 26 * payable days

If a person joins or leaves in the middle of a month:
Payable days = 26 - (total days present + EL days + National holidays) ... here, the weekly off, national holidays, and EL days are excluded.
Total BP = 2500 / 26 * payable days

If I ask for reasons and the rule is forgotten, please follow what we have been maintaining from the beginning. Here, I'm not justified. I would like to know if the above calculations are correct as per the law. Are there any other types of salary calculations or types of leave? Please let me know.

Please help me in this regard and expecting your valuable feedback.

Regards,
Elavarasan

Hi Elavarasan,

Ivanga okkandhu yosippangalo? The salary calculation for any employee is done for 30 days. For every Mon-Sat worked, he gets a paid weekly off on Sunday. So every month as per the rule, other than 4 weekly Sundays, he is entitled to 1 CL and 1 SL.

In a year, he has 12 CL, 12 SL, 12 EL, 12 Holidays (Festival + National). For every month worked, he earns 1 EL. The accumulated 12 EL is credited to his leave balance at the end of one year of his service. To this list of 48, add 52 Sundays also. 100 paid holidays/leave days. Ohoh... hahaha... the employer's blood would boil.

Calculating only 26 days is unheard of for a salaried employee. This would be possible for the daily wage employee or vendor's employee.

By this way, the employer is able to save the PF/ESI contribution payable to every employee. The situation of the present-day employers is fearsome, and they want to make money within the possible time. Kaliyuga... They will be ready and daring to do anything out of greed.

Elavarasan, better look out for a good company where rules and acts are followed, at least to a decent level of acceptance.

Regards,

Chandru

I would like to know clear details about the Leave policy (EL) as per the act. Could someone please forward it to me?

Dear Friend,

Yes, you are right. Any employee can avail his/her Earned Leave (EL) after the completion of the calendar year, and the calculation should be on a pro-rata basis. EL is calculated based on certain parameters fixed under the statute, whichever is applicable to you. EL is calculated if any employee works continuously in the organization for at least 240 days. If you have excluded your weekly offs, then it amounts to around 318 days in a year.

There are many things we need to clarify at the time of EL calculation.

Thanks,
Manoj

Hi Chandru,

Thank you for your immediate response. I would like to have more clarity in this regard. How many types of leaves and salary calculations are available, and how are they calculated? Please shed some light on this for me. If there are any books available, please let me know.

Seniors, please help me.

Thank you,
Elavarasan

Hi Chandru,

Thank you for your immediate reply. I would like to have more clarity in this regard. How many types of leaves and salary calculations are available, how they are calculated, and how they can be availed. Please shed some light on this matter. If there are any books available, please let me know.

Seniors, please help me in this regard!

Please excuse me for the missing words in my earlier reply.

Thanks,
Elavarasan

Dear Elavarsan,

As per the TN Shop & Establishment Act, the following regulations are in place:

1. One Casual Leave (CL) and one Sick Leave (SL) are allowed every month.
2. Upon completing a year of service, 12 Privilege Leaves (PL) are credited to the employee's leave quota.
3. Apart from these, the usual weekly offs and holidays are applicable.
4. For married female employees, a mandatory 12-week maternity leave (6 weeks before and 6 weeks after delivery) is granted at the time of childbirth.
5. Other than these provisions, there are no additional special leave allotments. These rules serve as the foundation. Some companies may attempt to modify these regulations for their convenience. Ultimately, it is at the discretion of the Labour Inspector in the respective zone to approve or reject such modifications during inspections.

The publication mentioned is available at C. Seetharaman & Co. in Anna Nagar (Asiad colony), T. Nagar, or Royapettah (Ajantha).

For further correspondence, please reach out to me via email at chandruselva@yahoo.com.

Regards,
Chandru