Salary Calculation Confusion: How Should We Count Days for Monthly Pay in Kerala?

Salary Calculation Based on Days in the Month

Should the per day salary be calculated by considering the actual number of days in the month, i.e., 30 or 31, based on the month? Or should we calculate it by considering 26 days? We follow a 6-day week policy with Sunday as a paid weekly off and provide a monthly salary. We are based in Kerala.

Can someone please advise me based on the labor law being followed in Kerala? We are an automobile dealership.

Salary Payment and Weekly Off Considerations

Salary is paid monthly. However, in a month, the weekly off is also considered as paid time off. Yet, for statutory duties, the weekly off is excluded unless the employee works on their off days.

Salary Payment and Weekly Off Considerations

Salary is paid monthly. However, in a month, the weekly off is also considered as paid time off. Yet, for statutory duties, the weekly off is excluded unless the employee works on their off days.

Dear Timmu,

Under the Minimum Wages Act of 1948 and its Central Rules, statutory minimum rates of wages include the wages for the weekly holiday as well. Therefore, for the purpose of conversion, the monthly rate shall be divided by 26 to arrive at the daily rate, and the daily rate should be multiplied by 30 to determine the monthly wages. Moreover, I believe that as per the Kerala Shops and Commercial Establishments Act of 1960, the weekly holiday allowed to employees should be a paid holiday.

To avoid errors resulting from the varying number of days in each month, my suggestion would be to divide the monthly wages by the actual number of days in the particular month, which could be 28, 29, 30, or 31 depending on the month, to arrive at the exact daily rate.

Thank you.

Alternative Method for Calculating Daily Wages

There is another school of thought I have noticed in my career at one of the MNCs. For monthly paid employees, to calculate daily wages, the formula used is (Monthly Salary x 12) / 365.

Regards, S K Bandyopadhyay