Salary Calculation Confusion: Is Every Month Counted as 30 Days or Actual Days?

Hi HR Professionals, I would like to know how the salary is calculated for the month. Is it a standard of 30 days for all year, or is it according to the number of days in a month? For example, in February, will it be calculated for 29 days or 30 days?

Regards,
Deepti

Salary Calculation for Monthly and Daily Paid Employees

See, it is different for Monthly Paid and Daily Paid salary. If you are calculating for a monthly-rated employee, then you have to use the formula: Fixed Salary/month days * Payable Days. For a daily-rated employee, the formula will be Fixed Salary * Payable Days.

In the case of Monthly Paid, Payable Days include Actual Present Days + Paid Holidays + Weekly Off + Leaves. In the case of daily wages, weekly off will not be payable.

For calculating Leave Encashment, use 30, and for Gratuity, use 26 as the divider.

Regards,
Vijay Dere

Earned Leave Calculation and Salary Formulas

Is there any law or act to calculate earned leave for 30 days? When calculating, you should use the following formulas:

- For employees with a fixed salary per month: Fixed Salary / Month Days * Payable Days
- For daily rated employees: Fixed Salary * Payable Days

In the case of monthly-paid employees, the Payable Days include Actual Present Days, Paid Holidays, Weekly Off, and Leaves. For daily wage workers, Weekly Off will not be payable.

To calculate Leave Encashment, use 30 days, and for Gratuity, use 26 as the divisor.

No, there is no specific act or law governing this situation, but monthly-paid employees generally receive their salary for 30 days. That's why, do you understand my point?

Salary Calculation Formula

Use the following formula for easy understanding:

Monthly Salary = Gross Salary / No. of days in the month * No. of days present in the month.

If an employee is receiving a gross salary of Rs. 8000/-, then his salary will be as follows if he is present on all days:

- For 31 days, Monthly salary = 8000 / 31 * 31 = Rs. 8000/-
- For 30 days, Monthly salary = 8000 / 30 * 30 = Rs. 8000/-
- For 28 days, Monthly salary = 8000 / 28 * 28 = Rs. 8000/-

If any LOP (Loss of Pay) occurs, just deduct the number of days present in the month.

Regards