Dear All,
I have come across an interesting situation as follows: Our employees are permanent employees employed for a specific monthly salary. On the payslip, it is shown that the employee has worked for 26 days and had 4 days off. The Labour Inspector is saying that we cannot divide the employee's salary by 30 days; it needs to be divided by 26 days. The logic he is giving is that, as per the law, after working for 6 days, the employee is entitled to 1 day off per week. Therefore, we cannot claim that we are paying for the employee's day off. If I divide the monthly salary by 26 days, then the daily rate of wages becomes higher. What is your opinion?
Thank you.
From India, Mumbai
I have come across an interesting situation as follows: Our employees are permanent employees employed for a specific monthly salary. On the payslip, it is shown that the employee has worked for 26 days and had 4 days off. The Labour Inspector is saying that we cannot divide the employee's salary by 30 days; it needs to be divided by 26 days. The logic he is giving is that, as per the law, after working for 6 days, the employee is entitled to 1 day off per week. Therefore, we cannot claim that we are paying for the employee's day off. If I divide the monthly salary by 26 days, then the daily rate of wages becomes higher. What is your opinion?
Thank you.
From India, Mumbai
For monthly paid employees, it is being divided by the No. days in the particular month. This practice is being followed in many companies. Pon
From India, Lucknow
From India, Lucknow
Dear Manish,
It's an interesting topic to discuss; I have worked in many industries, but everywhere the rule is to divide the monthly salary by 30 days, not 26 days. As per labor law, it's true that working for 6 days, the employee is entitled to 1 day off per week, but it's a paid holiday. Yes, but if you pay salary on a daily wage basis, you have to show the salary for 26 days. In my view, if an employee is getting a specified monthly salary, there is no such rule, but if it's on a daily wage basis, then it is calculated based on 26 days in a month. I think this topic has already been discussed in this forum. It's good that we discuss such issues in this forum because I believe every HR professional has somewhere in their career encountered such situations.
Best Regards
From India, Surat
It's an interesting topic to discuss; I have worked in many industries, but everywhere the rule is to divide the monthly salary by 30 days, not 26 days. As per labor law, it's true that working for 6 days, the employee is entitled to 1 day off per week, but it's a paid holiday. Yes, but if you pay salary on a daily wage basis, you have to show the salary for 26 days. In my view, if an employee is getting a specified monthly salary, there is no such rule, but if it's on a daily wage basis, then it is calculated based on 26 days in a month. I think this topic has already been discussed in this forum. It's good that we discuss such issues in this forum because I believe every HR professional has somewhere in their career encountered such situations.
Best Regards
From India, Surat
well what i have studied and wht’s been implemented in my organisation is that the salary is to be calculated from working days after leaving off-days.
From India, Chandigarh
From India, Chandigarh
Dear Manish,
Monthly salary to be divided by 30/26 is really confusing. This one varies from organization to organization. But I think if you pay more than the legal requirement, then there is no problem. In our organization, we calculate OT/Gratuity by dividing by 26 days; otherwise, it's 30 days.
For example, one employee's monthly salary/wage is 6000/- per month. In any month (30 days), if he worked 15 days, availed 2 days off with wage, and had 4 days off, then the total pay days are 21 days. Now, we calculate their salary by dividing by 30 days:
Paid salary = 6000 - (6000/30) * (30-21) = 6000 - 200 * 9 = 6000 - 1800 = 4200
Now dividing by 26 days:
Paid salary = 6000 - (6000/26) * (26-17) = 6000 - 230.76 * 9 = 6000 - 2077 = 3923
I think 4200 > 3929; of course, this is beneficial for the employee.
Thanks,
Manish
From India, Bangalore
Monthly salary to be divided by 30/26 is really confusing. This one varies from organization to organization. But I think if you pay more than the legal requirement, then there is no problem. In our organization, we calculate OT/Gratuity by dividing by 26 days; otherwise, it's 30 days.
For example, one employee's monthly salary/wage is 6000/- per month. In any month (30 days), if he worked 15 days, availed 2 days off with wage, and had 4 days off, then the total pay days are 21 days. Now, we calculate their salary by dividing by 30 days:
Paid salary = 6000 - (6000/30) * (30-21) = 6000 - 200 * 9 = 6000 - 1800 = 4200
Now dividing by 26 days:
Paid salary = 6000 - (6000/26) * (26-17) = 6000 - 230.76 * 9 = 6000 - 2077 = 3923
I think 4200 > 3929; of course, this is beneficial for the employee.
Thanks,
Manish
From India, Bangalore
It is common that for deciding daily wage, the monthly wage is divided by 30 irrespective of whether the month has 30, 31, or 28 days. However, for calculating gratuity, it is to be divided by 26 only. Similarly, for finding out the retrenchment compensation as per the Industrial Disputes Act, the salary is to be divided by 30.
Regards,
Madhu T.K
From India, Kannur
Regards,
Madhu T.K
From India, Kannur
Dear Manish,
Greetings for the day.
Yes, the labor inspector is correct. The monthly salary should be divided by 26 instead of 30, 31, 28, or 29. Take the example of the minimum wage in any state, and you will find that the average daily wage is calculated by basic + DA/26 instead of 30, 31, 28, or 29 days.
Thanks & Regards,
Sumit Kumar Saxena
9899669071, 0120-4131277
From India, Ghaziabad
Greetings for the day.
Yes, the labor inspector is correct. The monthly salary should be divided by 26 instead of 30, 31, 28, or 29. Take the example of the minimum wage in any state, and you will find that the average daily wage is calculated by basic + DA/26 instead of 30, 31, 28, or 29 days.
Thanks & Regards,
Sumit Kumar Saxena
9899669071, 0120-4131277
From India, Ghaziabad
Dear all,
Calculating the daily wage will differ from establishment to establishment depending upon the law applicable to it. Namely, whether it is the Factories Act, the Shops and Establishments Act, the Mines Act, the Plantation Labour Act, or the Motor Transport Workers Act. The only exception to this rule is the Payment of Gratuity Act, where it is provided that the monthly wage should be divided by 26 to obtain the daily wage.
Take, for example, the Factories Act. This Act states that the first day of the week shall be a holiday for the worker, meaning the worker should have a weekly off day. However, the Factories Act does not specify that the weekly off should be a paid holiday. Therefore, if the employer wants to calculate the daily wages, they have to divide the monthly wage by 26.
Considering the Tamil Nadu Shops and Establishments Act, this Act mandates that every shop or establishment should be closed for a day in a week. Furthermore, it specifies that no deduction should be made from the wages of any employed person in a shop/establishment for any day or part of a day on which a holiday has been allowed under the Act. This implies that for a monthly-paid employee in a shop or establishment to determine their daily wage, their monthly wage should be divided by 30/31. In the case of a daily-paid employee, they should be compensated for the days on which the shop remains closed.
The provisions of the Plantation Labour Act are similar to the Factories Act. This Act also provides for a rest day every seven days for all workers but does not mandate payment for the rest day. Sometimes, in agreements reached for Factories and Plantation work, a weekly off with wages may be provided. In such cases, to calculate the daily wage, the monthly wage should be divided by 30.
When the Government sets minimum wages for any scheduled employment under the Minimum Wages Act and specifies that wages must be paid for weekly holidays, the monthly wage should be divided by 30 to determine the daily wage.
Under the Industrial Disputes Act, retrenchment compensation is calculated as "fifteen days average pay for every completed year of continuous service in excess of six months." The term "average pay" is defined under section 2(aaa). Based on this definition, the "average pay" must be calculated to compute the retrenchment compensation.
With regards,
From India, Madras
Calculating the daily wage will differ from establishment to establishment depending upon the law applicable to it. Namely, whether it is the Factories Act, the Shops and Establishments Act, the Mines Act, the Plantation Labour Act, or the Motor Transport Workers Act. The only exception to this rule is the Payment of Gratuity Act, where it is provided that the monthly wage should be divided by 26 to obtain the daily wage.
Take, for example, the Factories Act. This Act states that the first day of the week shall be a holiday for the worker, meaning the worker should have a weekly off day. However, the Factories Act does not specify that the weekly off should be a paid holiday. Therefore, if the employer wants to calculate the daily wages, they have to divide the monthly wage by 26.
Considering the Tamil Nadu Shops and Establishments Act, this Act mandates that every shop or establishment should be closed for a day in a week. Furthermore, it specifies that no deduction should be made from the wages of any employed person in a shop/establishment for any day or part of a day on which a holiday has been allowed under the Act. This implies that for a monthly-paid employee in a shop or establishment to determine their daily wage, their monthly wage should be divided by 30/31. In the case of a daily-paid employee, they should be compensated for the days on which the shop remains closed.
The provisions of the Plantation Labour Act are similar to the Factories Act. This Act also provides for a rest day every seven days for all workers but does not mandate payment for the rest day. Sometimes, in agreements reached for Factories and Plantation work, a weekly off with wages may be provided. In such cases, to calculate the daily wage, the monthly wage should be divided by 30.
When the Government sets minimum wages for any scheduled employment under the Minimum Wages Act and specifies that wages must be paid for weekly holidays, the monthly wage should be divided by 30 to determine the daily wage.
Under the Industrial Disputes Act, retrenchment compensation is calculated as "fifteen days average pay for every completed year of continuous service in excess of six months." The term "average pay" is defined under section 2(aaa). Based on this definition, the "average pay" must be calculated to compute the retrenchment compensation.
With regards,
From India, Madras
I totally agree with V.harikrishnan sir With regards sarvesh shukla HR Executive Sodexo india
From India, Gurgaon
From India, Gurgaon
Dear Manish and others,
Are you paying as per Minimum Wages notified? In that case, the monthly wages are a multiple of 26. Indeed, every day's wage is the wage for 1 and 1/6 day's wages so that at the end of the sixth day, the wages of 7 days are made up. Therefore, you don't have to pay for the weekly off day. In fact, if you divide the monthly minimum wages by 26, you will get the daily wage rate.
In other cases where you pay an amount higher than minimum wages, the daily wages could be computed by dividing by the number of working days in that month. For example, if someone is absent for 5 days without pay, the deduction would be the monthly wages divided by the number of days in the wage month multiplied by 5, the number of days of absence. Harikrishnan has already elaborated on the other aspects.
Regards,
KK
From India, Bhopal
Are you paying as per Minimum Wages notified? In that case, the monthly wages are a multiple of 26. Indeed, every day's wage is the wage for 1 and 1/6 day's wages so that at the end of the sixth day, the wages of 7 days are made up. Therefore, you don't have to pay for the weekly off day. In fact, if you divide the monthly minimum wages by 26, you will get the daily wage rate.
In other cases where you pay an amount higher than minimum wages, the daily wages could be computed by dividing by the number of working days in that month. For example, if someone is absent for 5 days without pay, the deduction would be the monthly wages divided by the number of days in the wage month multiplied by 5, the number of days of absence. Harikrishnan has already elaborated on the other aspects.
Regards,
KK
From India, Bhopal
Hi, good morning.
My question is: suppose an employee worked only 22 days, but the total days, including days off, is 22 + 4 (days off) = 26. Can they get a full salary when the salary calculation is based on 26 days, or will they only receive 22 days' salary when working for 26 days in a month? In other words, they cannot avail paid leave due to zero balance in paid leaves.
From India, Nagpur
My question is: suppose an employee worked only 22 days, but the total days, including days off, is 22 + 4 (days off) = 26. Can they get a full salary when the salary calculation is based on 26 days, or will they only receive 22 days' salary when working for 26 days in a month? In other words, they cannot avail paid leave due to zero balance in paid leaves.
From India, Nagpur
Dear Friends,
The salary paid should be for 26 days, and the monthly salary is fixed by hours. We calculate the Gratuity based on 26 days for this reason.
In a month, there will be a possible working hours calculation like this: 26 days X 8 hours daily, which equals 208 hours. Similarly, for 27 days, it would be 27 X 8 hours. The number of possible working hours is an important factor. If you need to deduct 2 hours of salary or pay 1.5 hours of overtime, you can do so.
In a manufacturing organization where production is on an hourly basis, determining the production bonus requires knowing how many hours a person has worked in a month, whether it's 208 or 200.
Thanks to all,
Siddhartha Guhathakurta
Sr. Manager (P&A)
Coca-Cola Kolkata
siddhartha@diamondbev.in
From India, Calcutta
The salary paid should be for 26 days, and the monthly salary is fixed by hours. We calculate the Gratuity based on 26 days for this reason.
In a month, there will be a possible working hours calculation like this: 26 days X 8 hours daily, which equals 208 hours. Similarly, for 27 days, it would be 27 X 8 hours. The number of possible working hours is an important factor. If you need to deduct 2 hours of salary or pay 1.5 hours of overtime, you can do so.
In a manufacturing organization where production is on an hourly basis, determining the production bonus requires knowing how many hours a person has worked in a month, whether it's 208 or 200.
Thanks to all,
Siddhartha Guhathakurta
Sr. Manager (P&A)
Coca-Cola Kolkata
siddhartha@diamondbev.in
From India, Calcutta
Thanks to Mr.Hari Krishnan for sharing your views on thos topic, we look forward for more inputs from you Sir. With Warm Regards, Sreehariprasad.n Manager HR dhli Super Specialty Hospital
From India, New+Delhi
From India, New+Delhi
Logically the view of labour inspector seems correct though most offices follow the 30 day rule. I think it time we correct it and start following the 26 working days in the month rule.
From India, Chakan
From India, Chakan
First of all, I would like to congratulate the creator of this forum for the optimum utilization of technology. Keep it up. Also, I would like to ask for a favor. I am a Civil Engineer. Can anyone tell me if there is a civil engineer forum available? Please reply.
From India, Mumbai
From India, Mumbai
Please go through the state minimum wages notification. In accordance with the minimum wages notifications of Haryana, Punjab, and Delhi, one can clearly interpret that to calculate minimum daily wages, we are to divide the minimum monthly wages by 26.
Regards,
Atul
From India, New Delhi
Regards,
Atul
From India, New Delhi
Please go through the state minimum wages notifications. As per the notifications for Haryana, Punjab, and Delhi minimum wages, one can clearly see that to calculate the minimum daily wages, we are required to divide the minimum monthly wages by 26.
Regards,
Atul
From India, New Delhi
Regards,
Atul
From India, New Delhi
Dear Atul,
Please go through the state minimum wages notifications. As per the notifications for Haryana, Punjab, and Delhi minimum wages, it is clear that to calculate minimum daily wages, we are required to divide the minimum monthly wages by 26.
You are correct in stating that, according to the Minimum Wages Act, we cannot pay less than the prescribed daily minimum wages. For example, with a monthly wage of Rs. 4503.00, the corresponding daily wage would be Rs. 173.19. Therefore, we must ensure that no employee is paid less than Rs. 173.19 for any working day. However, in the case of higher salaries, we can calculate the wages based on a 30 or 31-day month. I believe this should not pose any issues.
Regards,
[Your Name]
From India, New Delhi
Please go through the state minimum wages notifications. As per the notifications for Haryana, Punjab, and Delhi minimum wages, it is clear that to calculate minimum daily wages, we are required to divide the minimum monthly wages by 26.
You are correct in stating that, according to the Minimum Wages Act, we cannot pay less than the prescribed daily minimum wages. For example, with a monthly wage of Rs. 4503.00, the corresponding daily wage would be Rs. 173.19. Therefore, we must ensure that no employee is paid less than Rs. 173.19 for any working day. However, in the case of higher salaries, we can calculate the wages based on a 30 or 31-day month. I believe this should not pose any issues.
Regards,
[Your Name]
From India, New Delhi
Thank you for sharing, Harikrishnan, sir. I have one confusion between wages and salary. We, as professionals, are given a salary. Does that mean these laws should not be applicable to us? Which level of employees are given wages and which level are given a salary? Please clarify.
From India, Bhopal
From India, Bhopal
If I take 2 days of leave per month, the daily wage calculation is based on the number of working days or total days in a month. If it is based on the number of working days, let's say 26, then the loss of pay will be higher. If it is based on the total days in the month, the loss of pay will be less. What will be the correct procedure for the loss of pay calculation?
Thank you,
Anand E.
From India, Coimbatore
Thank you,
Anand E.
From India, Coimbatore
Dear Manish,
Generally, if we divide salary by 26 days, an employee's daily wage will be higher compared to 30 days. If an employee takes 2 or 3 days off, except Sunday, their deductions will be greater than for 30 days. Therefore, dividing the salary by 30 is more beneficial for the employee.
With Regards,
Manish Dave
HR Manager
Balaji Construction
From India, Pune
Generally, if we divide salary by 26 days, an employee's daily wage will be higher compared to 30 days. If an employee takes 2 or 3 days off, except Sunday, their deductions will be greater than for 30 days. Therefore, dividing the salary by 30 is more beneficial for the employee.
With Regards,
Manish Dave
HR Manager
Balaji Construction
From India, Pune
Dear Reemawadhwa,
There is no difference between the terms "salary" and "wage." Both are the same. The applicability of any labor law has to be decided with reference to the provisions of that particular law and not based on the terms "salary" or "wage."
With regards
From India, Madras
There is no difference between the terms "salary" and "wage." Both are the same. The applicability of any labor law has to be decided with reference to the provisions of that particular law and not based on the terms "salary" or "wage."
With regards
From India, Madras
[QUOTE=Manish Gadre;1609964]Dear All,
I have come across an interesting situation as follows: Our employees are permanent employees employed for a specific monthly salary. On the payslip, it is shown that the employee has worked for 26 days and had 4 week offs. The Labour Inspector is saying that we cannot divide the salary of the employee by 30 days, and it needs to be divided by 26 days. The logic he is giving is that as per the law, after working for 6 days, the employee is entitled to 1 day off per week, and thus we cannot claim that we are paying for the employee's day off. If I divide the monthly salary by 26 days, then the daily rate of wages goes up. What is your opinion???
I think there is a confusion in his mind regarding the gratuity act, wherein the calculation is based on 26 days. In the case of monthly wages/salary payments, it is usually calculated based on the actual number of days of the particular month. However, in some organizations, for the sake of simplicity, it is taken as a standard 30 days (including for the month of February).
Take an example: If a person has worked up to the 20th of a particular month, which is not a weekend, i.e., Saturday, then he would be eligible for wages up to the 20th only on a pro-rata basis. But in case the 20th happens to be a Saturday, then, in that case, he would be paid wages for Sunday also, provided he has actually worked for the full week (preceding days). If he has been absent during the week and he is not entitled to leave, wages for that day would be deducted as well as he would not be entitled to wages for the 21st. This is a logical approach that may be taken.
Regards,
S.G. Bhavnani
From India, Delhi
I have come across an interesting situation as follows: Our employees are permanent employees employed for a specific monthly salary. On the payslip, it is shown that the employee has worked for 26 days and had 4 week offs. The Labour Inspector is saying that we cannot divide the salary of the employee by 30 days, and it needs to be divided by 26 days. The logic he is giving is that as per the law, after working for 6 days, the employee is entitled to 1 day off per week, and thus we cannot claim that we are paying for the employee's day off. If I divide the monthly salary by 26 days, then the daily rate of wages goes up. What is your opinion???
I think there is a confusion in his mind regarding the gratuity act, wherein the calculation is based on 26 days. In the case of monthly wages/salary payments, it is usually calculated based on the actual number of days of the particular month. However, in some organizations, for the sake of simplicity, it is taken as a standard 30 days (including for the month of February).
Take an example: If a person has worked up to the 20th of a particular month, which is not a weekend, i.e., Saturday, then he would be eligible for wages up to the 20th only on a pro-rata basis. But in case the 20th happens to be a Saturday, then, in that case, he would be paid wages for Sunday also, provided he has actually worked for the full week (preceding days). If he has been absent during the week and he is not entitled to leave, wages for that day would be deducted as well as he would not be entitled to wages for the 21st. This is a logical approach that may be taken.
Regards,
S.G. Bhavnani
From India, Delhi
Dear Mr.Santhoshharshe Please read my first post in this thread. Wages for weekly off depends on the Act applicable to the establishment in which the worker is employed. With regards
From India, Madras
From India, Madras
Dear all,
Calculating daily wages varies from one establishment to another depending on the applicable laws, such as the Factories Act, Shops and Establishments Act, Mines Act, Plantation Labour Act, or Motor Transport Workers Act. In my case, working in a mine, the Factory Act, Shops and Establishments Act, and Mines Act are all applicable.
In my organization, executives are paid based on 30 days, while non-executives are paid based on 26 days, regardless of whether they are monthly rated, time-rated, or daily rated, or even piece-rated (although piece jobs are not available, designations exist). Additionally, the calculation may also be influenced by the relationship between the union and management.
Thank you.
From India, Raigarh
Calculating daily wages varies from one establishment to another depending on the applicable laws, such as the Factories Act, Shops and Establishments Act, Mines Act, Plantation Labour Act, or Motor Transport Workers Act. In my case, working in a mine, the Factory Act, Shops and Establishments Act, and Mines Act are all applicable.
In my organization, executives are paid based on 30 days, while non-executives are paid based on 26 days, regardless of whether they are monthly rated, time-rated, or daily rated, or even piece-rated (although piece jobs are not available, designations exist). Additionally, the calculation may also be influenced by the relationship between the union and management.
Thank you.
From India, Raigarh
Dear all,
If we go through the notification regarding the minimum wages issued, we can find the answer. In the notification itself, two rates are given:
1) Total wages payable per month
2) Daily rate of wages per day
Secondly, we cannot pay less than the minimum wages. For example, in Andhra Pradesh (AP), the skilled monthly rate is 6922.00, and the daily rate is 266.23. You can see that the daily rate is calculated by multiplying the daily rate by 26 days. This is as simple as that.
If we go through the notification regarding the minimum wages issued, we can find the answer. In the notification itself, two rates are given:
1) Total wages payable per month
2) Daily rate of wages per day
Secondly, we cannot pay less than the minimum wages. For example, in Andhra Pradesh (AP), the skilled monthly rate is 6922.00, and the daily rate is 266.23. You can see that the daily rate is calculated by multiplying the daily rate by 26 days. This is as simple as that.
Salary rule is to divide the monthly salary by 30 days, not by 26 days, which is quite logical as well.
As per labor law, every employer is bound to give one paid leave after 6 working days. That means the employer is paying for 30 days, not for 26 days, so it will be divided by 30.
From India, Ghaziabad
As per labor law, every employer is bound to give one paid leave after 6 working days. That means the employer is paying for 30 days, not for 26 days, so it will be divided by 30.
From India, Ghaziabad
Dear All,
It is really confusing. What people are apparently worried about is that if they follow the labor inspector's advice, the costs will go high. It boils down to us being more concerned with keeping the costs than complying with the law and the spirit of the law. Are we not splitting hairs? Death and taxes cannot be avoided. Either we try to comply or "save" in the short run and later pay a hefty penalty. If the law is silent, then the section needs to be viewed from the spirit instead of the letter.
Regards,
AK
From India, Bangalore
It is really confusing. What people are apparently worried about is that if they follow the labor inspector's advice, the costs will go high. It boils down to us being more concerned with keeping the costs than complying with the law and the spirit of the law. Are we not splitting hairs? Death and taxes cannot be avoided. Either we try to comply or "save" in the short run and later pay a hefty penalty. If the law is silent, then the section needs to be viewed from the spirit instead of the letter.
Regards,
AK
From India, Bangalore
Hi Manish, For monthly rated employees, the monthly salary is divided by the number of calendar days in a given month and not 26. Regards
From India, Mumbai
From India, Mumbai
My opinions are against the labor officer. If this calculation is for an employee working on a monthly wage, then it should be divided by 30, since the holiday is a paid one. If an employee reports to work on that day, we have to pay him at the rate of $150 per hour, which is how you pay when someone works overtime. Does the labor inspector mean that in the months where there are many off days for either Diwali or other occasions, do we calculate their wages for that month as salary/25 or /24? This is ridiculous. Divisible by 30 days is also widely accepted worldwide, even if the month has 31 days.
However, if you need to determine how to calculate the daily wage for a temporary employee or one who works on an hourly basis, then dividing by the exact number of days worked is acceptable.
From United Arab Emirates, Dubai
However, if you need to determine how to calculate the daily wage for a temporary employee or one who works on an hourly basis, then dividing by the exact number of days worked is acceptable.
From United Arab Emirates, Dubai
Though the subject has been amply dealt with by various experts, here I would like to mention the difference in how it affects the employees. Assuming we calculate the salary on a 30-day basis, then the employee will benefit from his/her absence but will lose out on overtime payments. In the case of a 26-day calculation, it will be vice versa. Another point to consider is that employees who are earning minimum wages and have their pay calculated on a 30/31-day basis will not receive overtime pay as per the minimum wage regulations, leading to the organization defaulting on the payment of minimum wages.
Thanks for initiating the thread.
S R Shivrayan
Sr. Manager HR & Admin
Derewala Jewellery Industries Ltd, Jaipur
From India, Jaipur
Thanks for initiating the thread.
S R Shivrayan
Sr. Manager HR & Admin
Derewala Jewellery Industries Ltd, Jaipur
From India, Jaipur
I fully agree with what Mr. Harikrishnan said. If he is a monthly paid employee, his salary has to be divided by 30/31 for making a loss of pay for the days not worked, if any. If he is a daily rated employee, the minimum wage as notified by the Government has to be divided by 26 only. Accordingly, his total wage will be calculated based on the number of days worked. The logic behind this is only to cover the weekly holiday.
As per the provisions of the Shops & Estt Act or Factories Act, an employee is entitled to one day of weekly holiday after working for six days. For the monthly paid employee, we are allowing the weekly holiday, whereas it is not there in the case of daily rated employees. To cover the provision of the weekly holiday, the monthly rate has to be divided by 26 in the case of daily rated employees, whereas the monthly rate is to be divided by 30/31 in the case of monthly rated employees since the monthly rated employees are enjoying the weekly holiday.
In other words, the monthly paid employee will work for 26 days only and will get the salary for the full month by including four weekly holidays. This facility may not be applicable to the daily rated employee. Hence, to cover the weekly holiday, his salary is to be divided by 26 only instead of 30/31, as in the case of permanent employees.
With regards,
Sanagapalli VR
Asst Director (Retd)
E.S.I.CORPORATION
From India, Hyderabad
As per the provisions of the Shops & Estt Act or Factories Act, an employee is entitled to one day of weekly holiday after working for six days. For the monthly paid employee, we are allowing the weekly holiday, whereas it is not there in the case of daily rated employees. To cover the provision of the weekly holiday, the monthly rate has to be divided by 26 in the case of daily rated employees, whereas the monthly rate is to be divided by 30/31 in the case of monthly rated employees since the monthly rated employees are enjoying the weekly holiday.
In other words, the monthly paid employee will work for 26 days only and will get the salary for the full month by including four weekly holidays. This facility may not be applicable to the daily rated employee. Hence, to cover the weekly holiday, his salary is to be divided by 26 only instead of 30/31, as in the case of permanent employees.
With regards,
Sanagapalli VR
Asst Director (Retd)
E.S.I.CORPORATION
From India, Hyderabad
Dear Joanna,
The Labor Officer cannot have an opinion contrary to the law. If you feel and are sure that he is wrong or incorrect, please try to provide the correct position based on specific provisions of the law applicable to an establishment. The overtime rate specified by you is also incorrect. If it is correct, then specify the provision of the law that states the worker should be paid $150 per hour. If, while calculating the daily wage for a monthly-rated employee, your calculation exceeds what should be paid under the law, your employer may not tolerate the mistake. Similarly, if you calculate less than what should be paid under the law for one day in the case of a monthly-rated employee or worker, the concerned individual worker or the union to which he belongs will not remain silent.
With regards,
From India, Madras
The Labor Officer cannot have an opinion contrary to the law. If you feel and are sure that he is wrong or incorrect, please try to provide the correct position based on specific provisions of the law applicable to an establishment. The overtime rate specified by you is also incorrect. If it is correct, then specify the provision of the law that states the worker should be paid $150 per hour. If, while calculating the daily wage for a monthly-rated employee, your calculation exceeds what should be paid under the law, your employer may not tolerate the mistake. Similarly, if you calculate less than what should be paid under the law for one day in the case of a monthly-rated employee or worker, the concerned individual worker or the union to which he belongs will not remain silent.
With regards,
From India, Madras
Dear All,
The logic for dividing the salary/wages by 26 was explained to me by one senior consultant as follows: the total number of days in a year is 365 - 52 weekly offs = 26.08. As the remaining days are slightly more than 26, they are divided by 26. This logic also applies in a leap year.
In case an employee works on a weekly off, the employer pays double wages. If you divide the salary/wage by 30, then you will actually be paying for the weekly off and end up paying three times the normal salary/wage in case the employee works on a weekly off, as you will have to pay double wages as per the act.
To arrive at the daily wage, the Minimum Wages Act follows the 26-day pattern, and the same is reflected in the Gratuity Act too. The employee, in fact, does not stand to lose irrespective of the month.
M.V.KANNAN
From India, Madras
The logic for dividing the salary/wages by 26 was explained to me by one senior consultant as follows: the total number of days in a year is 365 - 52 weekly offs = 26.08. As the remaining days are slightly more than 26, they are divided by 26. This logic also applies in a leap year.
In case an employee works on a weekly off, the employer pays double wages. If you divide the salary/wage by 30, then you will actually be paying for the weekly off and end up paying three times the normal salary/wage in case the employee works on a weekly off, as you will have to pay double wages as per the act.
To arrive at the daily wage, the Minimum Wages Act follows the 26-day pattern, and the same is reflected in the Gratuity Act too. The employee, in fact, does not stand to lose irrespective of the month.
M.V.KANNAN
From India, Madras
Hi,
As we all know, every employee is entitled to have one day off each week. This means we are also paying for those off days.
If you would like to calculate an employee's actual daily salary, it should be divided by 26, not by 30, since the employee is paid for their off days as well.
For example, if Mr. X's monthly salary is Rs 5000, which is for 30 or 31 days depending on the month, and he also has 4 days off, his per day salary would be calculated as 5000/26 since he works 26 days only.
From India, Mumbai
As we all know, every employee is entitled to have one day off each week. This means we are also paying for those off days.
If you would like to calculate an employee's actual daily salary, it should be divided by 26, not by 30, since the employee is paid for their off days as well.
For example, if Mr. X's monthly salary is Rs 5000, which is for 30 or 31 days depending on the month, and he also has 4 days off, his per day salary would be calculated as 5000/26 since he works 26 days only.
From India, Mumbai
Hi Manish, It should be calculated by the no of days the month have, divided by the no of working day. ignore weekly they are inclusive. No other rule. regards Amit Asst. Manager HR
From India, Amritsar
From India, Amritsar
An employee with a monthly salary receives the same pay regardless of the number of days in the month, whether it is February with 28 days or March with 31 days, because it is a monthly salary. Therefore, it is evident that the salary should be divided by the number of days in the month. Deductions in March would be lower than deductions if the same calculation is applied in the month of February.
From India, Delhi
From India, Delhi
If you calculate per day wages, then divided by 26. If you calculate monthly wages, then multiple by 30. It is as per rule. Regards Ramesh
From India, Tirunelveli
From India, Tirunelveli
So, in case of monthly paid employees we need to divide salary by month days (30/31 days) and in case of daily wages employees we need to divide by 26 days.
From India, Kota
From India, Kota
As per my opinion, it must be follow in each and every company, an institution also. through this the employee of the organization would improve and enhances the productivity and efficiency.
From India, Delhi
From India, Delhi
Hi Kavee_ta,
I am HR in a construction company in Pune. We have our power plant project in Raipur and Cement silo project in Karnataka. Kindly let me know if you or any of your colleagues are interested. For more details, kindly contact us at
.
From India
I am HR in a construction company in Pune. We have our power plant project in Raipur and Cement silo project in Karnataka. Kindly let me know if you or any of your colleagues are interested. For more details, kindly contact us at
From India
Very useful discussion thread. I need to know when we are deducting salary on account of LWP, do we, in that case, take 30/31 days or 22 days (we have 2 days off weekly)?? Salary is paid monthly.
Kind regards,
Anjali Verma
From India, Delhi
Kind regards,
Anjali Verma
From India, Delhi
Hi,
Taking the calculations by Manish as below:
"For example, one employee's monthly salary/wage is 6000/- per month. In any month (30 days), he worked 15 days and availed 2 leaves with wage and 4 days off, then the total paid days is 21 days. Now, we calculate their salary by dividing 30 days.
Paid salary = 6000 - (6000/30) * (30-21) = 6000 - 200 * 9 = 6000 - 1800 = 4200.
Now, dividing by 26 days:
Paid salary = 6000 - (6000/26) * (26-17) = 6000 - 230.76 * 9 = 6000 - 2077 = 3923."
What is really the correct practice as per the law?
As we refer to Sumit, "minimum wage of any state, you will find the average daily wage is calculated by basic+da/26 instead of 30, 31, 28, or 29 days"; the wage rate calculation is based on "basic+da". So, how can one calculate salary including various allowances on a monthly basis?
Does the terminology Minimum Wages Rate have the symbolic importance to derive a figure and place it on the board usually placed in the front of the office as per the requirement under the shop act?
Dear experts, please unbundle the jugglery of minimum wages rate.
From India, Jaipur
Taking the calculations by Manish as below:
"For example, one employee's monthly salary/wage is 6000/- per month. In any month (30 days), he worked 15 days and availed 2 leaves with wage and 4 days off, then the total paid days is 21 days. Now, we calculate their salary by dividing 30 days.
Paid salary = 6000 - (6000/30) * (30-21) = 6000 - 200 * 9 = 6000 - 1800 = 4200.
Now, dividing by 26 days:
Paid salary = 6000 - (6000/26) * (26-17) = 6000 - 230.76 * 9 = 6000 - 2077 = 3923."
What is really the correct practice as per the law?
As we refer to Sumit, "minimum wage of any state, you will find the average daily wage is calculated by basic+da/26 instead of 30, 31, 28, or 29 days"; the wage rate calculation is based on "basic+da". So, how can one calculate salary including various allowances on a monthly basis?
Does the terminology Minimum Wages Rate have the symbolic importance to derive a figure and place it on the board usually placed in the front of the office as per the requirement under the shop act?
Dear experts, please unbundle the jugglery of minimum wages rate.
From India, Jaipur
Dear Mr. Jain,
The correct practice to arrive at the daily wages of a monthly-rated employee, according to the law and approved by the Honourable Supreme Court in Jeewanlal's case, is to divide the monthly wages by 26 and not by 30.
With regards
From India, Madras
The correct practice to arrive at the daily wages of a monthly-rated employee, according to the law and approved by the Honourable Supreme Court in Jeewanlal's case, is to divide the monthly wages by 26 and not by 30.
With regards
From India, Madras
Dear Mr. Harikrishnan,
I would like to clarify that when calculating the daily wages of a monthly-rated employee, the correct method is to divide the monthly wages by 26, not by 30. However, when calculating the monthly wages, the process should be done in the usual manner, as illustrated below:
"For example, if an employee's monthly salary is 6000/- per month and in a given month (30 days) they worked for 15 days, took 2 days of leave with pay, and had 4 days off, the total number of paid days would be 21. To calculate their salary for that month, we would use the following formula:
Paid salary = 6000 - (6000/30) * (30-21) = 6000 - 200 * 9 = 6000 - 1800 = 4200"
I hope this clarifies the calculation process. Please let me know if you have any further questions or need additional information.
Thank you.
From India, Jaipur
I would like to clarify that when calculating the daily wages of a monthly-rated employee, the correct method is to divide the monthly wages by 26, not by 30. However, when calculating the monthly wages, the process should be done in the usual manner, as illustrated below:
"For example, if an employee's monthly salary is 6000/- per month and in a given month (30 days) they worked for 15 days, took 2 days of leave with pay, and had 4 days off, the total number of paid days would be 21. To calculate their salary for that month, we would use the following formula:
Paid salary = 6000 - (6000/30) * (30-21) = 6000 - 200 * 9 = 6000 - 1800 = 4200"
I hope this clarifies the calculation process. Please let me know if you have any further questions or need additional information.
Thank you.
From India, Jaipur
Dear Mr. Anurag Jain,
Before addressing your query, I would like to present an issue for you to analyze and respond to. I am presenting a hypothetical situation as follows: If an employee takes leave without pay for fifteen days in a month consisting of 30 days, would you deduct wages for the weekly holidays (at least two) that fall within the fifteen days of unpaid leave? If your response is 'YES' for this hypothetical scenario, please specify the statutory authority based on which you would make such deductions.
With regards
From India, Madras
Before addressing your query, I would like to present an issue for you to analyze and respond to. I am presenting a hypothetical situation as follows: If an employee takes leave without pay for fifteen days in a month consisting of 30 days, would you deduct wages for the weekly holidays (at least two) that fall within the fifteen days of unpaid leave? If your response is 'YES' for this hypothetical scenario, please specify the statutory authority based on which you would make such deductions.
With regards
From India, Madras
Dear Mr. Harikrishnan,
Many thanks for guiding us; lastly, please clarify the below scenario:
Employee A:
Days worked in July 11: 22 days (from date 1 to 22 July 11 inclusive of 2 leaves taken)
Leaves taken: 2
Leaves in credit: 2
Paid holidays pending after 22 July 11: 2 Sundays
Short Days: 31 Days – 22 Days worked = 9 Days
Monthly salary: 6000.00
Minimum Wages calculation: Rs 6000.00/26 = 231.00
Wages calculation:
Rs 6000.00 – (6000.00 * 9/31 days) = Rs 4258.00
or
Rs 6000.00 – (9 Days * Rs 231.00) = Rs 3921.00
or
any other
Please suggest to clear this very important issue.
Kind regards,
Anurag Jain
From India, Jaipur
Many thanks for guiding us; lastly, please clarify the below scenario:
Employee A:
Days worked in July 11: 22 days (from date 1 to 22 July 11 inclusive of 2 leaves taken)
Leaves taken: 2
Leaves in credit: 2
Paid holidays pending after 22 July 11: 2 Sundays
Short Days: 31 Days – 22 Days worked = 9 Days
Monthly salary: 6000.00
Minimum Wages calculation: Rs 6000.00/26 = 231.00
Wages calculation:
Rs 6000.00 – (6000.00 * 9/31 days) = Rs 4258.00
or
Rs 6000.00 – (9 Days * Rs 231.00) = Rs 3921.00
or
any other
Please suggest to clear this very important issue.
Kind regards,
Anurag Jain
From India, Jaipur
I totally agree with Ms. Vandana. According to the law, wages are to be divided by 26 days, and if monthly salary is paid, it will be divided by 30 days. This practice is followed in most of the companies.
With regards,
Neha Gupta
Assistant Manager HR
From India, Delhi
With regards,
Neha Gupta
Assistant Manager HR
From India, Delhi
Dear Mr. Anurag Jain,
In the example cited by you, how many days did the employee work in July 2011? How many days of leave with wages were availed in July 2011? How many days of leave without wages were availed in July 2011? How many days of weekly off did he have during July 2011? What is the law relating to working conditions applicable to the industrial establishment in which the employee was working (e.g., Factories Act, Shops and Establishments Act, etc.)?
If you are kind enough to provide the above information, I will try to answer your query.
With regards,
From India, Madras
In the example cited by you, how many days did the employee work in July 2011? How many days of leave with wages were availed in July 2011? How many days of leave without wages were availed in July 2011? How many days of weekly off did he have during July 2011? What is the law relating to working conditions applicable to the industrial establishment in which the employee was working (e.g., Factories Act, Shops and Establishments Act, etc.)?
If you are kind enough to provide the above information, I will try to answer your query.
With regards,
From India, Madras
Dear Ms.Neha Gupta Can you kindly indicate the 'law' referred to in your last post With regards
From India, Madras
From India, Madras
Dear Mr. Harikrishnan,
The information as required:
1. How many days worked by the employee in July 2011
Days worked in July 11: 22 days (from date 1 to 22 July 11 including Two leaves eligible with wages)
2. How many days leave with wages availed in July 2011
Two leaves eligible with wages
3. How many days leave without wages availed in July 2011
9 Days
4. There is no opening balance of leaves with the employee, and leaves with wages allowed per month is 2 leaves.
5. How many days of the weekly off he had during July 2011
Three Sundays and 3 half Saturdays total 4.5 days (3.0+1.5)
6. What is the law relating to working conditions applicable to the industrial establishment in which the employee was working (like Factories Act, Shops and Establishments Act, etc.)
The Shops and miscellaneous establishment act, Rajasthan is applicable.
7. Wages per month Rs 6000.00
8. Number of days in July 11 = 31 Days
9. Number of weekly lay off days remaining after 22.07.11 = 2 Sundays and 2 Saturdays = 3.0 days (2.0+1.0)
10. Wages calculation:
Rs 6000.00 – (6000.00*9/31 days) = Rs 4258.00
or
Rs 6000.00 – (9 Days * Rs 231.00) = Rs 3921.00
or
Rs 6000.00 – [(9 Days * Rs 231.00) – (3.0 paid lay off days * Rs 231.00) = Rs 1386.00] = Rs 4614.00
Or Suggest
Please suggest to clear the implication of minimum wages over the wages payment.
One more thing is that, are minimum wages always calculated on Basic +DA?
Many thanks for responding to us in the appropriate manner.
Kind regards,
Anurag Jain
From India, Jaipur
The information as required:
1. How many days worked by the employee in July 2011
Days worked in July 11: 22 days (from date 1 to 22 July 11 including Two leaves eligible with wages)
2. How many days leave with wages availed in July 2011
Two leaves eligible with wages
3. How many days leave without wages availed in July 2011
9 Days
4. There is no opening balance of leaves with the employee, and leaves with wages allowed per month is 2 leaves.
5. How many days of the weekly off he had during July 2011
Three Sundays and 3 half Saturdays total 4.5 days (3.0+1.5)
6. What is the law relating to working conditions applicable to the industrial establishment in which the employee was working (like Factories Act, Shops and Establishments Act, etc.)
The Shops and miscellaneous establishment act, Rajasthan is applicable.
7. Wages per month Rs 6000.00
8. Number of days in July 11 = 31 Days
9. Number of weekly lay off days remaining after 22.07.11 = 2 Sundays and 2 Saturdays = 3.0 days (2.0+1.0)
10. Wages calculation:
Rs 6000.00 – (6000.00*9/31 days) = Rs 4258.00
or
Rs 6000.00 – (9 Days * Rs 231.00) = Rs 3921.00
or
Rs 6000.00 – [(9 Days * Rs 231.00) – (3.0 paid lay off days * Rs 231.00) = Rs 1386.00] = Rs 4614.00
Or Suggest
Please suggest to clear the implication of minimum wages over the wages payment.
One more thing is that, are minimum wages always calculated on Basic +DA?
Many thanks for responding to us in the appropriate manner.
Kind regards,
Anurag Jain
From India, Jaipur
Dear Mr. Anurag Jain,
You have been given the monthly wage rate of the worker as Rs. 6000/-. To arrive at the daily wage rate of the worker, you divide Rs. 6000/- by 26. The answer is Rs. 231/-. This is the daily wage rate of the worker, and based on this, you have to calculate the wages for 22 days by multiplying Rs. 231/- by 22. The answer is Rs. 5082.
With regards
From India, Madras
You have been given the monthly wage rate of the worker as Rs. 6000/-. To arrive at the daily wage rate of the worker, you divide Rs. 6000/- by 26. The answer is Rs. 231/-. This is the daily wage rate of the worker, and based on this, you have to calculate the wages for 22 days by multiplying Rs. 231/- by 22. The answer is Rs. 5082.
With regards
From India, Madras
I too agree with V. Harikrishnan sir's input.
For daily wage calculation, we divide the worker's pay by 26 days, whereas for staff's pay, it is divided by 30/31 days as applicable.
Regards,
Abhishek
From India, Vadodara
For daily wage calculation, we divide the worker's pay by 26 days, whereas for staff's pay, it is divided by 30/31 days as applicable.
Regards,
Abhishek
From India, Vadodara
Dear Mr. Harikrishnan,
If the manager of the company is working on a regular employment basis at a salary of Rs 60,000.00 (Basic salary is Rs 30,000.00 + HRA Rs 15,000.00 + Conveyance Allowance Rs 10,000.00 + Special Allowances Rs 5,000.00), for the same scenario; will the salary for 22 days be as below:
Daily wage rate: Rs 60,000.00 / 26 = Rs 2,308.00
Salary for 22 days = Rs 2,308.00 x 22 Days = Rs 50,776.00
Please respond to the above query for better clarity.
Kind regards,
Anurag Jain
From India, Jaipur
If the manager of the company is working on a regular employment basis at a salary of Rs 60,000.00 (Basic salary is Rs 30,000.00 + HRA Rs 15,000.00 + Conveyance Allowance Rs 10,000.00 + Special Allowances Rs 5,000.00), for the same scenario; will the salary for 22 days be as below:
Daily wage rate: Rs 60,000.00 / 26 = Rs 2,308.00
Salary for 22 days = Rs 2,308.00 x 22 Days = Rs 50,776.00
Please respond to the above query for better clarity.
Kind regards,
Anurag Jain
From India, Jaipur
I, completely, agree with Harishkrishnan and Sanagapalli sir’s input. For daily wage, calculation is to for 26 working days. For monthly salary, it is to be divided by 30/31 days.
From India, Vadodara
From India, Vadodara
Dear Mr. Anrag Jain,
My replies in this post are not based on my assumptions but on the law laid down by the Honourable Supreme Court. The monthly salary accepted to be paid at the time of appointment or subsequent revision, whether it is in the case of a "worker" or "employee" or "manager," is the rate of wages. It has been accepted by the Honourable Supreme Court of India that though the wages/salary is termed as "monthly wages," while calculating the "daily rate," the "monthly rate" has to be divided by 26. Therefore, to arrive at the daily rate, divide the monthly rate by 26 in the case of the manager referred to by you.
With regards,
From India, Madras
My replies in this post are not based on my assumptions but on the law laid down by the Honourable Supreme Court. The monthly salary accepted to be paid at the time of appointment or subsequent revision, whether it is in the case of a "worker" or "employee" or "manager," is the rate of wages. It has been accepted by the Honourable Supreme Court of India that though the wages/salary is termed as "monthly wages," while calculating the "daily rate," the "monthly rate" has to be divided by 26. Therefore, to arrive at the daily rate, divide the monthly rate by 26 in the case of the manager referred to by you.
With regards,
From India, Madras
Hi,
As per the example shown by you, it is clear that what the person has received is not mentioned, i.e., 6000/26 = 231. He received a salary for 21 days at Rs. 4851, but according to your calculations, he is only getting Rs. 4200.
Regards,
Vijay Shukla
From United Kingdom
As per the example shown by you, it is clear that what the person has received is not mentioned, i.e., 6000/26 = 231. He received a salary for 21 days at Rs. 4851, but according to your calculations, he is only getting Rs. 4200.
Regards,
Vijay Shukla
From United Kingdom
what will be gross pay under salary rule 26 divided inspite of 31 for month july-12 if actul day 24, weekly off 4 and leave given 2 days
From India, Nagar
From India, Nagar
ILO adopted Convention No. 1 in the year 1919, limiting hours of work in industry to 48 hours in a week. Until this Convention came into force, workers worked ranging from 12 to 15 hours or even more daily, on all days in industrial countries. Wages used to be paid weekly.
Two years later, in 1921, ILO adopted Convention No. 14 declaring that workers in the industry shall enjoy a weekly holiday of rest comprising at least twenty-four consecutive hours.
Thus, workers became eligible for full wages for all seven days by working 48 hours in 6 days.
India was one of the very few countries that promptly ratified these Conventions by amending the Indian Factories Act of 1911 that was in force during those times. The amendment to restrict working hours was notified on 14-07-1921, and the weekly holiday was declared through a similar amendment notified on 11-05-1923.
There was no need during those times to specifically state that wages should be paid for a weekly holiday. Temporary and casual employment to circumvent labor laws became predominant during the twenty-first century, especially during the last few decades.
The labor departments and employers have found ways to circumvent the law by weaving a clever ploy of fixing the daily rate of wage, claiming that it was arrived at by dividing a monthly figure by 26. The fact, on the contrary, is that temps and casuals are paid abysmally low wages compared to regular workers. This ploy is against the letter and spirit of the law. It does not hold water in cases where the daily wage rate is agreed upon independently through negotiation between the union representing temporary workers and the employer. Even in such a case, I am encountering a problem where a traditional enterprise metamorphosed as a modern global enterprise is harping on the right of the employer to deny wages on the weekly day of rest to casual workers!
From India, Ernakulam
Two years later, in 1921, ILO adopted Convention No. 14 declaring that workers in the industry shall enjoy a weekly holiday of rest comprising at least twenty-four consecutive hours.
Thus, workers became eligible for full wages for all seven days by working 48 hours in 6 days.
India was one of the very few countries that promptly ratified these Conventions by amending the Indian Factories Act of 1911 that was in force during those times. The amendment to restrict working hours was notified on 14-07-1921, and the weekly holiday was declared through a similar amendment notified on 11-05-1923.
There was no need during those times to specifically state that wages should be paid for a weekly holiday. Temporary and casual employment to circumvent labor laws became predominant during the twenty-first century, especially during the last few decades.
The labor departments and employers have found ways to circumvent the law by weaving a clever ploy of fixing the daily rate of wage, claiming that it was arrived at by dividing a monthly figure by 26. The fact, on the contrary, is that temps and casuals are paid abysmally low wages compared to regular workers. This ploy is against the letter and spirit of the law. It does not hold water in cases where the daily wage rate is agreed upon independently through negotiation between the union representing temporary workers and the employer. Even in such a case, I am encountering a problem where a traditional enterprise metamorphosed as a modern global enterprise is harping on the right of the employer to deny wages on the weekly day of rest to casual workers!
From India, Ernakulam
Hi Everyone,
Good day. I just want to share my case, and I hope you can help me. I was contracted for 2 months, from Nov. 3, 2014, to Dec. 22, 2014, for 17,000 pesos per month. My work schedule was Monday to Thursday, from 8 am to 6 pm, and Friday from 8 am to 5 pm, to compress the working hours for Saturday. They divided my monthly salary into 24 days, equivalent to 708.33 pesos per day.
But what about for the month of December? I only had to work for 16 days. I was absent once, so they calculated my salary based on 15 days worked x 708.33. I only received 10,624.95 pesos. I lost almost 7,000 pesos for just one day of absence. Can someone explain this to me? Do I have the right to complain?
From Philippines, Quezon City
Good day. I just want to share my case, and I hope you can help me. I was contracted for 2 months, from Nov. 3, 2014, to Dec. 22, 2014, for 17,000 pesos per month. My work schedule was Monday to Thursday, from 8 am to 6 pm, and Friday from 8 am to 5 pm, to compress the working hours for Saturday. They divided my monthly salary into 24 days, equivalent to 708.33 pesos per day.
But what about for the month of December? I only had to work for 16 days. I was absent once, so they calculated my salary based on 15 days worked x 708.33. I only received 10,624.95 pesos. I lost almost 7,000 pesos for just one day of absence. Can someone explain this to me? Do I have the right to complain?
From Philippines, Quezon City
Labour law in Maharashtra state states that when a worker does not receive their monthly payment, certain actions can be taken against the employer. In a situation where a worker has completed a full month of work but has not received their salary for any reason, specific rules apply. The employer is obligated to ensure timely payment of wages to the worker. Failure to do so can result in legal consequences for the employer. It is essential for the employer to comply with the labour laws and promptly address any issues related to payment to avoid potential disputes or legal actions.
From India, Nashik
From India, Nashik
If you are giving the salary on 30 days,Inspector can claim for double of the regular pay for 4 days and panalty follows as per respective Act. Thanks Shashi Jha Human Resources
From India, Madras
From India, Madras
Dear All, all i need to know is the Govt Rules / Regulations regarding calculation of monthly salary on 26 or 30 days basis for security guards in maharashtra and india. Thank you very much.
From India, Pune
From India, Pune
I broadly agree with V Harikrishnan.
However, the matter must be viewed in historical perspective to come to a rational conclusion.
Eligibility for full wage was reduced to 48 hours of work per week by ILO Convention No. 1 of 1919 and consequent amendment to Indian Factories Act, 1911 effective from 14-07-1921. Before ILO adopted its first Convention in 1919 industrial workers toiled for several hours per day on all days and were paid wage per week. Wage is related to work; weekly holiday became one of the fundamental rights of workers. Therefore to be fair, monthly salary must be divided by the number of working days, i.e. by 26 in establishments following 6 working days per week.
India ratified on 14-07-1921 ILO Convention No1 of 1919 concerning Hours of Work (Industry) which limited working hours to 48 hours per week. Further, India ratified on 11-05-1923 ILO Convention No.14 concerning Weekly Rest (Industry), which entitled workers to enjoy a weekly holiday.
To give effect to these ILO Conventions, Indian Factories Act, 1911 which was then in force was amended vide notification dated 14-07-1921 and 11-05-1923. As per Section 22 of that amended Act no person shall be employed in any factory on a Sunday, unless: (a) he has had, or will have, a holiday for a whole day on one of the three days immediately preceding or succeeding the Sunday, and (b) the manager of the factory has previous to the Sunday or the substituted day, whichever is earlier, given notice to the inspector of his intention so to employ the said person and of the day which is to be substituted, and has at the same time affixed a notice to the same effect in the place mentioned in Section 36.
It is obvious that Factories 1948 Act substantially continued the provision as contained in Indian Factories Act, 1911.
There was no need either during 1923 or 1948 to expressly state that wages should paid for weekly holiday because full wage used to paid for the whole week including Sunday, which was a working day until ILO Convention declared it as weekly holiday and consequent amendment to Indian Factories Act, 1911 effective from 11-05-1923.
It is significant that ILO convention No.14 concerning Weekly Rest (Industry) is applicable to industrial undertakings such as mines, quarries, manufacturing construction, transport etc. Those employed in commercial offices including trading establishments, theatre etc., remained out of coverage of the Convention No. 14 of 1921. Therefore, a separate Convention was adopted by ILO in 1957 vide Convention No 106 concerning Weekly Rest in Commercial Offices to confer the right to weekly rest to these employees. Generally, the employment practice in this latter category of establishments was in the nature of monthly employment on salary. These workers normally enjoyed relatively less working hours compared to industrial workers. This employment practice probably led ILO to stipulate in convention No 106 of 1957, vide Article 9 that “there shall be no reduction of income of persons covered by this Convention as a result of the application of measures taken in accordance with the Convention”. Later day enactments as for example in Shops and Establishment Acts of various State Governments therefore specifically lays down that weekly rest must be allowed with wage.
In several advanced industrial countries labour law reforms reduced working hours to 35 hours per week; and five working days per week. In India the Government and employers consider that progressive legislation of British regime stand in the way of ease of doing business in India! If one adopts this new perspective such a rationale would tend to pay as much less for workers so as to enhance the ease of doing business. The question is would that approach be fair?
From India, Ernakulam
However, the matter must be viewed in historical perspective to come to a rational conclusion.
Eligibility for full wage was reduced to 48 hours of work per week by ILO Convention No. 1 of 1919 and consequent amendment to Indian Factories Act, 1911 effective from 14-07-1921. Before ILO adopted its first Convention in 1919 industrial workers toiled for several hours per day on all days and were paid wage per week. Wage is related to work; weekly holiday became one of the fundamental rights of workers. Therefore to be fair, monthly salary must be divided by the number of working days, i.e. by 26 in establishments following 6 working days per week.
India ratified on 14-07-1921 ILO Convention No1 of 1919 concerning Hours of Work (Industry) which limited working hours to 48 hours per week. Further, India ratified on 11-05-1923 ILO Convention No.14 concerning Weekly Rest (Industry), which entitled workers to enjoy a weekly holiday.
To give effect to these ILO Conventions, Indian Factories Act, 1911 which was then in force was amended vide notification dated 14-07-1921 and 11-05-1923. As per Section 22 of that amended Act no person shall be employed in any factory on a Sunday, unless: (a) he has had, or will have, a holiday for a whole day on one of the three days immediately preceding or succeeding the Sunday, and (b) the manager of the factory has previous to the Sunday or the substituted day, whichever is earlier, given notice to the inspector of his intention so to employ the said person and of the day which is to be substituted, and has at the same time affixed a notice to the same effect in the place mentioned in Section 36.
It is obvious that Factories 1948 Act substantially continued the provision as contained in Indian Factories Act, 1911.
There was no need either during 1923 or 1948 to expressly state that wages should paid for weekly holiday because full wage used to paid for the whole week including Sunday, which was a working day until ILO Convention declared it as weekly holiday and consequent amendment to Indian Factories Act, 1911 effective from 11-05-1923.
It is significant that ILO convention No.14 concerning Weekly Rest (Industry) is applicable to industrial undertakings such as mines, quarries, manufacturing construction, transport etc. Those employed in commercial offices including trading establishments, theatre etc., remained out of coverage of the Convention No. 14 of 1921. Therefore, a separate Convention was adopted by ILO in 1957 vide Convention No 106 concerning Weekly Rest in Commercial Offices to confer the right to weekly rest to these employees. Generally, the employment practice in this latter category of establishments was in the nature of monthly employment on salary. These workers normally enjoyed relatively less working hours compared to industrial workers. This employment practice probably led ILO to stipulate in convention No 106 of 1957, vide Article 9 that “there shall be no reduction of income of persons covered by this Convention as a result of the application of measures taken in accordance with the Convention”. Later day enactments as for example in Shops and Establishment Acts of various State Governments therefore specifically lays down that weekly rest must be allowed with wage.
In several advanced industrial countries labour law reforms reduced working hours to 35 hours per week; and five working days per week. In India the Government and employers consider that progressive legislation of British regime stand in the way of ease of doing business in India! If one adopts this new perspective such a rationale would tend to pay as much less for workers so as to enhance the ease of doing business. The question is would that approach be fair?
From India, Ernakulam
The Minimum Wages Act stipulates that for arriving at daily wage rate of a monthly wage rate, the monthly wage rate has to be divided by 26. bgramesh, hosur
From India, Vellore
From India, Vellore
But why would a difference occur between 30 days and 26 days?
30 days paid salary = 6000 - (6000/30) * (30-21) = 6000 - 200 * 9 = 6000 - 1800 = 4200. Now, dividing by 26 days.
Paid salary for 26 days = 6000 - (6000/26) * (26-17) = 6000 - 230.76 * 9 = 6000 - 2077 = 3923.
Like this.
From India, Vellore
30 days paid salary = 6000 - (6000/30) * (30-21) = 6000 - 200 * 9 = 6000 - 1800 = 4200. Now, dividing by 26 days.
Paid salary for 26 days = 6000 - (6000/26) * (26-17) = 6000 - 230.76 * 9 = 6000 - 2077 = 3923.
Like this.
From India, Vellore
Issue of Overtime & Salary: One employee's monthly salary/wage is 6000/- per month. In any month (27-4 days), when the salary is divided by 26, he worked 21 days, took 6 leaves, and did 1 overtime (as he worked on 1 weekly off) along with 4 days off. The total pay days amount to 21 days. After calculation, how much overtime pay and salary should we give him?
From India, Jhansi
From India, Jhansi
In the case of monthly paid employees, salary is paid per month. The Government of India adopted amendments to the Indian Factories Act, 1911 during 1921 and 1923 to give effect to a 48-hour workweek and a weekly holiday, respectively, following the ratification of relevant ILO Conventions. Workers in industrial countries were then employed per week, with no fixed working hours. In this situation, the ILO adopted two separate conventions granting workers the right to limit the workweek to 48 hours and to rest on Sundays/weekly off without any reduction to the prevailing weekly or monthly wage/salary.
Daily-rated employment was unheard of during those times, which is why the Act, after revision several times, kept the text in accordance with the ILO Convention. As a result, there is no need for a worker to buy a weekly off by offering 1/30th of the monthly salary; it is a right freely available to workers.
From India, Ernakulam
Daily-rated employment was unheard of during those times, which is why the Act, after revision several times, kept the text in accordance with the ILO Convention. As a result, there is no need for a worker to buy a weekly off by offering 1/30th of the monthly salary; it is a right freely available to workers.
From India, Ernakulam
For a permanent employee the salary should be divided by 30 as the payment made in this cases is not on daily wages,i.e. Per Piece etc
I would like to ask all one question on 26 vs. 28/30/31.
We have an employee with Basic+DA at Rs. 15,500/- in his salary. Therefore, he is exempted from the PF Act. This salary we are paying him for 30 days. So we can say that he is paid Rs. 517/day (Rs. 15,500/30).
Now, if a PF Inspector asks me that as per the Minimum Wage Act, his salary should be calculated on 26 days, according to my payroll, he is paid Rs. 13,442/- for 26 days (Rs. 517 X 26 days). Thus, his PF should be deducted because he is falling under Rs. 15,000/- for 26 days.
What should I be doing on this?
I would conclude that any salary should be calculated on a 26-day basis only. I have gone through many judgments on this subject, but nothing is clearly conclusive. In Labour Offices, PF-ESI Department, all suggest calculating on a 26-day concept only. It is a wrong practice in most companies, which we, being the New Generation HR, should rectify.
THIS IS MY PERSONAL OPINION
Someone said in this post above, giving an example of Tamil Nadu S&E, that his salary should not be deducted for weekly off days. What I concluded is that the Government meant by saying this that he should not be considered absent on such days. And if you divide by 26 and don't mark him absent, then automatically it counts as his presence and wages won't be deducted.
From India, Vapi
We have an employee with Basic+DA at Rs. 15,500/- in his salary. Therefore, he is exempted from the PF Act. This salary we are paying him for 30 days. So we can say that he is paid Rs. 517/day (Rs. 15,500/30).
Now, if a PF Inspector asks me that as per the Minimum Wage Act, his salary should be calculated on 26 days, according to my payroll, he is paid Rs. 13,442/- for 26 days (Rs. 517 X 26 days). Thus, his PF should be deducted because he is falling under Rs. 15,000/- for 26 days.
What should I be doing on this?
I would conclude that any salary should be calculated on a 26-day basis only. I have gone through many judgments on this subject, but nothing is clearly conclusive. In Labour Offices, PF-ESI Department, all suggest calculating on a 26-day concept only. It is a wrong practice in most companies, which we, being the New Generation HR, should rectify.
THIS IS MY PERSONAL OPINION
Someone said in this post above, giving an example of Tamil Nadu S&E, that his salary should not be deducted for weekly off days. What I concluded is that the Government meant by saying this that he should not be considered absent on such days. And if you divide by 26 and don't mark him absent, then automatically it counts as his presence and wages won't be deducted.
From India, Vapi
I agree with V. Harikrishnan that the Factories Act states that the first day of the week shall be a holiday for the worker; in other words, the worker should have a weekly off day. However, the Factories Act does not specify that the weekly off should be a paid weekly off. Therefore, if the employer wants to calculate the daily wages, they have to divide the monthly wage by 26.
The provision for a weekly holiday was incorporated into the Factories Act of 1911 in 1923 following the adoption of a Convention by the ILO entitling industrial workers to Sunday as a weekly holiday. The Convention mandated that Sunday be a holiday without any reduction in wages that were traditionally paid weekly for work done on all days of the week. As a result, the Factories Act does not address the issue of wages for the weekly holiday.
Therefore, Sunday as a holiday is a facility provided by the employer at the employer's expense. Whether in the late 20th century with employers paying daily rated wages or the 21st century with employers paying hourly rates, the situation remains unchanged. Employers must bear the cost of Sunday as a holiday. Hence, the suggestion by the Labour Inspector to divide the monthly wage by 26 is appropriate.
From India, Ernakulam
The provision for a weekly holiday was incorporated into the Factories Act of 1911 in 1923 following the adoption of a Convention by the ILO entitling industrial workers to Sunday as a weekly holiday. The Convention mandated that Sunday be a holiday without any reduction in wages that were traditionally paid weekly for work done on all days of the week. As a result, the Factories Act does not address the issue of wages for the weekly holiday.
Therefore, Sunday as a holiday is a facility provided by the employer at the employer's expense. Whether in the late 20th century with employers paying daily rated wages or the 21st century with employers paying hourly rates, the situation remains unchanged. Employers must bear the cost of Sunday as a holiday. Hence, the suggestion by the Labour Inspector to divide the monthly wage by 26 is appropriate.
From India, Ernakulam
When we see the minimum wage notification in Tamil Nadu, the following points are there in the notification:
(2) Where the nature of work is the same, no distinction in the payment of wages shall be made in the case of male and female employees.
(3) (a) To arrive at the daily rates of wages, the monthly rates of wages shall be divided by 26.
(b) To arrive at the monthly rates of wages, the daily rates of wages shall be multiplied by 30.
(4) Wherever the existing wages are higher than the minimum wages fixed herein, the same shall be continued to be paid.
From India, Madras
(2) Where the nature of work is the same, no distinction in the payment of wages shall be made in the case of male and female employees.
(3) (a) To arrive at the daily rates of wages, the monthly rates of wages shall be divided by 26.
(b) To arrive at the monthly rates of wages, the daily rates of wages shall be multiplied by 30.
(4) Wherever the existing wages are higher than the minimum wages fixed herein, the same shall be continued to be paid.
From India, Madras
Is there any law, notification, or circular from the Labour Department of the Jharkhand government that states the weekly off day, i.e., the seventh day (Sunday), should be a paid weekly off day? If so, why are wages divided by 26 days instead of 30 days?
From India, Jamshedpur
From India, Jamshedpur
Sir Let me know if apermanent employee working for 7.41 hr instead 8 hr he will pay for 8hr or 7.41 hr half day (4hr) which will be applicable in this situation as per law
From India, Bhubaneswar
From India, Bhubaneswar
Hi Everyone,
Thanks to the Senior for your valuable post.
As per my understanding, the factory act states that salary should be paid based on worked days. For example, if the minimum monthly wage is 13000/-, then the daily wage would be calculated as 13000/26 = 500 per day.
For the month of Apr-19, considering there are 4 Sundays (30-4=26), the salary would be calculated as 13000/26 * 26 = 13000. However, for May-19, where there are 4 Sundays and the total worked days are 31-4=27, I am uncertain about the calculation.
Should the calculation be:
1 - 13000/27 * 27 = 13000
2 - 13000/26 * 27 = 13500
The second option aligns with the concept of daily wages but results in the company paying on the higher side. This may lead to lower payments in February, causing discrepancies in monthly salaries.
Senior, please advise. Our company provides services with well-qualified employees deployed to various factories across pan-India. It is essential to standardize the calculation method in compliance with labor laws.
Thank you.
From India, Pune
Thanks to the Senior for your valuable post.
As per my understanding, the factory act states that salary should be paid based on worked days. For example, if the minimum monthly wage is 13000/-, then the daily wage would be calculated as 13000/26 = 500 per day.
For the month of Apr-19, considering there are 4 Sundays (30-4=26), the salary would be calculated as 13000/26 * 26 = 13000. However, for May-19, where there are 4 Sundays and the total worked days are 31-4=27, I am uncertain about the calculation.
Should the calculation be:
1 - 13000/27 * 27 = 13000
2 - 13000/26 * 27 = 13500
The second option aligns with the concept of daily wages but results in the company paying on the higher side. This may lead to lower payments in February, causing discrepancies in monthly salaries.
Senior, please advise. Our company provides services with well-qualified employees deployed to various factories across pan-India. It is essential to standardize the calculation method in compliance with labor laws.
Thank you.
From India, Pune
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CiteHR.AI
(Fact Checked)-The user reply contains accurate information regarding the calculation of daily wages based on different labor laws such as the Factories Act, Shops and Establishments Act, and others. The explanation provided aligns with the legal provisions mentioned. (1 Acknowledge point)