Dear Seniors,
In my establishment (Mfg Factory), we are practicing a 27-day or 26-day concept (meaning without weekly offs) for calculating the salary. For example, Sonu works for 17 days in July, and his salary is Rs. 10,000/- per month. Therefore, he receives Rs. 6,296/- calculated as 10,000/27*17. In another calculation, considering 17 days plus 4 w.offs equal to 21 days, he would receive Rs. 6,774/- calculated as 10,000/31*21.
I want to know which calculation is correct according to the Act and why. Please help me in this regard. Thank you.
From India, Delhi
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In my establishment (Mfg Factory), we are practicing a 27-day or 26-day concept (meaning without weekly offs) for calculating the salary. For example, Sonu works for 17 days in July, and his salary is Rs. 10,000/- per month. Therefore, he receives Rs. 6,296/- calculated as 10,000/27*17. In another calculation, considering 17 days plus 4 w.offs equal to 21 days, he would receive Rs. 6,774/- calculated as 10,000/31*21.
I want to know which calculation is correct according to the Act and why. Please help me in this regard. Thank you.
From India, Delhi
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In India, labor laws dictate how payroll should be processed, including considerations for weekly offs. The Payment of Wages Act, 1936, governs wage-related matters and provides guidelines for salary calculations. Here's a breakdown of the two scenarios presented:
1. 27-day Concept (Without Weekly Offs):
- Calculation: Rs. 10,000/27*17 = Rs. 6,296
- This method divides the monthly salary by the total working days in the month (27) and then multiplies it by the actual days worked (17).
- This approach is valid for establishments where weekly offs are not provided, and the salary is calculated based on actual working days in the month.
2. 26-day Concept (With Weekly Offs):
- Calculation: Rs. 10,000/31*21 = Rs. 6,774
- In this scenario, the monthly salary is divided by the total days in the month (31) and then multiplied by the total days worked including weekly offs (21).
- This method is applicable in organizations where employees are entitled to weekly offs, and the salary calculation includes both working days and weekly offs.
Correct Calculation:
- The correct calculation method depends on the company's policy and adherence to labor laws.
- If your establishment operates without weekly offs, the 27-day concept is appropriate.
- However, if weekly offs are part of the employment terms, the 26-day concept should be followed to ensure compliance with regulations.
Recommendation:
- Review your company's policies and ensure that the chosen calculation method aligns with the applicable labor laws in Delhi, India.
- Consult with a legal expert or HR specialist to confirm compliance and make any necessary adjustments to your payroll processing.
By following the correct calculation method, you can maintain transparency, fairness, and legal compliance in your salary disbursement practices.
From India, Gurugram
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311. 27-day Concept (Without Weekly Offs):
- Calculation: Rs. 10,000/27*17 = Rs. 6,296
- This method divides the monthly salary by the total working days in the month (27) and then multiplies it by the actual days worked (17).
- This approach is valid for establishments where weekly offs are not provided, and the salary is calculated based on actual working days in the month.
2. 26-day Concept (With Weekly Offs):
- Calculation: Rs. 10,000/31*21 = Rs. 6,774
- In this scenario, the monthly salary is divided by the total days in the month (31) and then multiplied by the total days worked including weekly offs (21).
- This method is applicable in organizations where employees are entitled to weekly offs, and the salary calculation includes both working days and weekly offs.
Correct Calculation:
- The correct calculation method depends on the company's policy and adherence to labor laws.
- If your establishment operates without weekly offs, the 27-day concept is appropriate.
- However, if weekly offs are part of the employment terms, the 26-day concept should be followed to ensure compliance with regulations.
Recommendation:
- Review your company's policies and ensure that the chosen calculation method aligns with the applicable labor laws in Delhi, India.
- Consult with a legal expert or HR specialist to confirm compliance and make any necessary adjustments to your payroll processing.
By following the correct calculation method, you can maintain transparency, fairness, and legal compliance in your salary disbursement practices.
From India, Gurugram
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