How to Correct a Mistaken Loss of Pay Entry: Seeking Advice on Best Practices

Hi Seniors, by mistake, if LOP (one day loss of pay) has been entered and as per the salary sheet is calculated, i.e., the employee was present but by oversight LOP is entered. How can we adjust this in the next month? By giving the difference amount through a voucher OR by showing it in the incentive of the next month OR if leave is taken, showing one day less taken leave. Which is correct? Expecting suggestions, please.

Regards,
Rajeev Dixit

Subject: Adjustment for Incorrect LOP Entry

Hi Seniors, by mistake, if LOP (one day loss of pay) has been entered, and as per the salary sheet is calculated, i.e., the employee was present but by oversight LOP is entered. How can we adjust this in the next month? By giving the difference amount through a voucher, or by showing it in the incentive of the next month, or if leave is taken, showing one day less taken leave. Which is correct? Expecting suggestions, please.

Regards,
Rajeev Dixit

You can do as you described, which is the so-called No. 2 payment. However, if you want to show No. 1 payment, please provide the salary arrears (Basic and Gross) so that you can comply with both PF and ESI provisions.

With Best Regards,

A person was present and was overlooked. Adjusting their salary is fine, but I fail to understand how we can give this salary as an incentive. Incentives are usually given based on performance. I would suggest instead issuing a voucher for that 1-day salary. Also, keep appropriate records for future reference. Mention in the voucher the reason for the adjustment so that you can refer back anytime and confirm they were present for the day. Hope this clears your doubt.

One day's loss of pay can be reimbursed in the next month's salary under the head "Arrears" and mention the days to be paid (definition of Arrears - An unpaid, overdue debt or an unfulfilled obligation), or else under the head "Other Earnings" calculate a day's salary, and mention the amount. The same can be mentioned in your payroll statement as well as records.

Regards,
Shamin.

Also, if you wish to adjust against leaves, you can consider one of the leaves as Present. This can be done if the employee has taken any leave during the next month. However, it is best to discuss with the employee and send an email stating how you will be reimbursing, so that you have a written record of reimbursing that day's salary.