Can My PF and Basic Salary Change Monthly Due to Leave Deductions? Seeking Clarification

Can the PF Amount Change Every Month?

I joined a company 4 months ago. In the month of July, I took 4 days off, although I am only eligible for 1 casual leave per month. Please note that there is no provision for PL for new/experienced staff until they complete 15 months of service. Additionally, taking more than 3 days off will result in a default stating that the minimum number of days required to be worked in a month has not been met. As a consequence, the salary for the 4 Sundays in the month, as well as the 4 days taken as leave, has been deducted as LOP in accordance with the company's leave policy. This deduction will impact the salary structure.

Is it possible for the basic salary and the PF amount to be adjusted for this reason? The calculation involves deducting 8 days of LOP from the gross salary and then recalculating the percentage for the basic salary and PF. Is it acceptable to change the PF and basic salary monthly based on these deductions? Your clarification on this matter would be appreciated.

Hi Sudha, LOP is calculated on Gross in most companies, but some companies also calculate it on Basic to discourage employees from taking excessive leaves. It appears that your company follows the latter method, which is why your PF amount changes since it is calculated based on Basic.

Hi Sudha,

The basic salary for a month can be different if Loss of Pay (LOP) occurs. Provident Fund (PF) is calculated as 12% of the basic salary, and it may change.

The formula to calculate the basic salary is as follows:
Basic salary = (monthly basic salary / number of days in the month) * (Number of days in the month - LOP days)

Please let me know if you need any further clarification or assistance.

Thank you.