Salary Calculation Confusion: Should I Use Working Days or a 30-Day Average?

Dear friends,

I am working as an Exec-HR in a pharma company. I have a doubt about whether to calculate salary based on the number of working days in a month for regular employees as in the case of contract staff or on an average of 30 days. Please help me soon.

Thanks,
Neelima

Hi Neelima,

I believe the salary has to be calculated based on the number of working days in a month, including Sundays.

Hi Jaspreet,

Thank you very much for your reply. What I meant to say is the number of working days should be 30 or depending on the working days in the particular month (For example, in February, do we only have to pay for 28 days, in March, 31 days... and so forth?)

Neelima

Yes, dear, of course, you have to pay the salary based on the number of working days in a month. For instance, for February: 28 working days, March: 31 working days, and so on...

Hi Neelima,

Jaspreet Kaur is saying that in February:

4 Sundays in Feb --- 28 (days in Feb) - 4 (Sundays) = 24 (working days)

If an employee's salary is 20000, then the calculation would be:

20000 / 28 * 24 = 17142

Is this correct, Mr. Jaspreet Kaur?

Regards,
Shree

Dear Shree,

Please see my first post. As mentioned, when calculating the number of working days, we have to count Sundays as well.

For example, the per month salary is Rs. 20,000/-. Now, for February, the salary per day would be Rs. 20,000/- divided by 28 (number of days).

I believe things are clarified now. If there are still any questions, please let me know. You are most welcome.

Dear Neelima,

I disagree with Jaspreet. The number of days is always taken as 30 days in a month for the calculation of pay for permanent employees. However, for casual workers, the days can be counted as the number of days actually worked.

With Regards,
Mr. Kanchan Deb
deb_kanchan10011972@yahoo.in

Salary is calculated for the whole month. It is not broken up according to the number of days. For example, if an employee's salary is Rs. 20,000/-, it will be paid in full, whether it is January or February. However, for the loss of pay, it is calculated according to the number of days.

For instance, if an employee experiences a three-day loss of pay in January, the pay will be calculated as follows:
20000/31 * 28

Similarly, for February, it will be calculated as follows:
20000/28 * 25

Please remember that when the offer letter was provided, it did not specify month-related salaries. Only when employing casual labor who are paid daily wages, can we break it up.

I hope this clarifies your doubt.

Dear all,

I totally agree with Dinesh and Kanchan regarding regular/permanent employees. However, in my current company, they calculate the number of working days in a month based on specific days (e.g., January-31, February-28, March-31...).

Does this practice vary across organizations, or is there a standard norm or government regulation related to this? I would like to discuss this matter with the management.

Please assist me.

Thanks,
Neelima

Dear All,

I don't think the calculation should be based on the number of working days. If we are calculating in March for 30 days, then we can also calculate it for 30 days in February.

Regards,
Minal

The regular employees' wages shall be calculated by 26 as per the Minimum Wages Act in the month of February. Am I right?

As per the rule, a daily wage worker, if he has worked for six days continuously, shall be paid one day extra salary for the seventh day, i.e., Sunday or Monday, whichever day your company has decided will be a closed holiday. According to the rules, no employer can make a worker work for more than 48 hours a week. The employer must provide a break (closed holiday) for one day after completing 48 hours, working at 6 hours a day with a half-hour recess every day.

When an appointment is on a monthly basis, the employer must pay salary for 30 days, which includes four rest days or closed holidays, such as Sundays. In shops, the weekly off days may be Monday, Tuesday, Wednesday, or as the case may be, with consultation with the Chamber of Commerce and government authorities.

For daily wage workers who have worked, say, for 46 days, for the first 30 days, they will receive full salary, and for the remaining 16 days, it will be calculated by dividing the total wage (basic + DA) by 26 and multiplying by 16. For example, if the monthly salary is 4000, it will be 4000/26*16. You can refer to Form VI issued by the appropriate government for engaging contract daily wage employees. This reference can also be obtained from the government notification by the respective labor department fixing minimum wages for skilled, unskilled, and highly skilled workers.

[QUOTE=kothapalli777;1062726]Hi Jaspreet,

You are absolutely right, Cal, on the number of working days during the particular month. Jaspreet and Neelima, what Dinesh has mentioned is correct because salary is given on a monthly basis standardized to 30 days, no matter if February has 28 days or 29 days.

It is to be intimated to whosoever is concerned that the calculation of salary based on the number of days, such as February having 28 or 29 days, or a standard 30 days, varies from organization to organization.

This is my belief, and I agree with it based on my experiences in various organizations. Therefore, I kindly request everyone to note that what I have previously posted is not consistently followed by every organization regarding the number of days in a month (28, 29, or 30); this practice varies across organizations.

Please note: Any month, any number of days - if attendance is full, then it will be calculated based on the total days of that particular month. If there are 31 days, it will be calculated on a 31-day basis. If there are 30 days, the calculation will be based on 30 days. If there are 28 days, then it will be calculated on a 28-day basis.