How to calculated workers & staffs Loss of Pay(LOP)salary details & OverTime calculation Please help in this regards
From India, Coimbatore
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From India, Coimbatore
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Understanding Loss of Pay (LOP)
LOP is nothing but Leave without Pay, which we can also define as an absence day for unauthorized leave. It can be calculated as follows: Total Gross / Number of total days in a month * Total number of hours (i.e., 8 hours = 1 Day OT to be considered) = LOP for a day (in Rupees).
Overtime Calculation
Here, I would like to recommend you refer to clause 63 of Wages for Overtime Work under the Shops & Establishment Act, which states as follows (the copy of the provision for payment of OT under S&E Act is enclosed for your ready reference):
"Wages for overtime work.- Where an employee in any establishment to which this Act applies is required to work in excess of the limit of hours of work, he shall be entitled, in respect of the overtime work, to wages at the rate of twice his ordinary rate of wages.
Explanation: For the purposes of this section, the expression 'limit of hours of work' shall mean:
(a) In the case of employees in shops and commercial establishments, nine hours in any day and forty-eight hours in any week;
(b) In the case of employees in residential hotels, restaurants, eating houses, theatres, or other places of public amusement or entertainment, nine hours in any day; and
(c) In the case of employees in any other establishment, such hours as may be prescribed.
Provided that the maximum limit for working overtime shall not exceed three hours, and the employer may, for the purpose of the work beyond the said overtime hours, engage an additional number of employees."
Here, you need to consider the definition of wages in the definition column of section 2 under the Bombay Shops & Establishment Act, which states to refer to the definition of wages in The Payment of Wages Act. Find below the wording mentioned in the legislation and the copy of the definition of wages under S&E Act for your further reference.
"Wages" means wages as defined in the Payment of Wages Act, 1936 (IV of 1936).
Since it is mentioned in the Bombay S&E Act, we are referring to the definition in the Payment of Wages Act, where the attached file of the definition of wages under the Payment of Wages Act confirms that all the remuneration, except any bonus, gratuity, any contribution paid by the employer to any pension or provident fund, value of any house-accommodation, water, medical attendance or any other amenity.
Calculation for Overtime = Gross * 2.
I hope I have clarified all your queries related to LOP & Overtime calculations.
Regards,
Janardan
From India, Mumbai
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87LOP is nothing but Leave without Pay, which we can also define as an absence day for unauthorized leave. It can be calculated as follows: Total Gross / Number of total days in a month * Total number of hours (i.e., 8 hours = 1 Day OT to be considered) = LOP for a day (in Rupees).
Overtime Calculation
Here, I would like to recommend you refer to clause 63 of Wages for Overtime Work under the Shops & Establishment Act, which states as follows (the copy of the provision for payment of OT under S&E Act is enclosed for your ready reference):
"Wages for overtime work.- Where an employee in any establishment to which this Act applies is required to work in excess of the limit of hours of work, he shall be entitled, in respect of the overtime work, to wages at the rate of twice his ordinary rate of wages.
Explanation: For the purposes of this section, the expression 'limit of hours of work' shall mean:
(a) In the case of employees in shops and commercial establishments, nine hours in any day and forty-eight hours in any week;
(b) In the case of employees in residential hotels, restaurants, eating houses, theatres, or other places of public amusement or entertainment, nine hours in any day; and
(c) In the case of employees in any other establishment, such hours as may be prescribed.
Provided that the maximum limit for working overtime shall not exceed three hours, and the employer may, for the purpose of the work beyond the said overtime hours, engage an additional number of employees."
Here, you need to consider the definition of wages in the definition column of section 2 under the Bombay Shops & Establishment Act, which states to refer to the definition of wages in The Payment of Wages Act. Find below the wording mentioned in the legislation and the copy of the definition of wages under S&E Act for your further reference.
"Wages" means wages as defined in the Payment of Wages Act, 1936 (IV of 1936).
Since it is mentioned in the Bombay S&E Act, we are referring to the definition in the Payment of Wages Act, where the attached file of the definition of wages under the Payment of Wages Act confirms that all the remuneration, except any bonus, gratuity, any contribution paid by the employer to any pension or provident fund, value of any house-accommodation, water, medical attendance or any other amenity.
Calculation for Overtime = Gross * 2.
I hope I have clarified all your queries related to LOP & Overtime calculations.
Regards,
Janardan
From India, Mumbai
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LEAVE ENCASHMENT NOT INCLUDED IN WAGES FOR P. F. CALCULATION.pdf
Method of calculation of wages.doc