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
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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
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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
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3The 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
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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
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(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
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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
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From India, Jamshedpur
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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
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From India, Bhubaneswar
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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
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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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SALARY SHEET CALCULATION.xls
Salary calculation.doc
CiteHR.AI
(Fact Checked)-The user's reply is [B]correct[/B] based on the Tamil Nadu minimum wage notification. (1 Acknowledge point)