Changing Wage Period: Can We Shift to a 26th-25th Cycle Without Issues?

Dear Sir, currently, we have a wage period based on the calendar month. Is it possible for us to change the wage period at our own discretion from the 26th of the previous month to the 25th of the current month? Alternatively, can we close attendance as of the 25th of the month, pay wages for the remaining period of the month in advance, and in the following month, adjust any deductions if necessary, or else the attendance will automatically be regularized? If we adopt this salary processing pattern, will there be any issues for the employer? Your valuable and expert guidance on this matter would be greatly appreciated.

Best regards.

Please refer to Section 4 of the Payment of Wages Act, 1936, which precisely deals with the fixation of wage periods.

Mandatory Fixation of Wage Periods

Subsection (1) of Sec. 4 makes it mandatory for the employer to fix the wage period, which means the periodicity in which wages are payable. It can be anything like daily, weekly, fortnightly, etc. However, Subsection (2) of Sec. 4 limits it to monthly by declaring that no wage period shall exceed one month. Just for the sake of clarity, a month is universally considered to comprise 30 days. Therefore, within these limits, you can change your wage period accordingly.

Clarification on Wage Period and Advances

But your statement based on the closing of the attendance of the employees on every 25th of the month, that the wages for the remaining period of the month are to be treated as advance, does not seem logical. Since the 26th day of the previous month is the starting date of the period of a 30-day cycle, why should you unnecessarily treat the wages for the period after the 25th day of the following month as advance?