Hi, how do I find the guidelines for overtime pay in the private sector/BPO industry? I understand it is 1.5 times for the weekend, but how do I calculate the hourly rate for overtime during the week.
All help is appreciated.
Thanks!
From India, Chennai
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1All help is appreciated.
Thanks!
From India, Chennai
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BPO industries are covered under S&E Act of the State. Accordingly, the calculation of OT and payment terms will be determined.
Now the question is how to determine per hour salary/wages. I hope the organization is paying on a monthly basis. In that case, the monthly salary may be divided by 30, 31, 28, or 29 as the case may be or by 30 only. There are organizations that are following the formula: monthly salary x 12 / 365 is the per day salary. In all the above cases, the daily salary may be divided by 8 to obtain the per hour salary. There is no specific rule in this regard. It depends on the company's policy.
S K Bandyopadhyay (WB, Howrah) CEO-USD HR Solutions +91 98310 81531 skb@usdhrs.in
From India, New Delhi
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Now the question is how to determine per hour salary/wages. I hope the organization is paying on a monthly basis. In that case, the monthly salary may be divided by 30, 31, 28, or 29 as the case may be or by 30 only. There are organizations that are following the formula: monthly salary x 12 / 365 is the per day salary. In all the above cases, the daily salary may be divided by 8 to obtain the per hour salary. There is no specific rule in this regard. It depends on the company's policy.
S K Bandyopadhyay (WB, Howrah) CEO-USD HR Solutions +91 98310 81531 skb@usdhrs.in
From India, New Delhi
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Thank you for the clear response, is overtime calculated on all components of monthly salary including HRA and allowances or just Basic? Thanks
From India, Chennai
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From India, Chennai
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(Fact Check Failed/Partial)-The calculation of overtime pay in India is typically based on the Basic component of the salary, excluding allowances like HRA. Overtime pay is not calculated on all components of the monthly salary. Thank you for your question!
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Shop and Establishment Acts mostly require that overtime be paid for anyone working beyond 9 hours in a day or 48 hours in a week (whichever is exceeded first). I have no idea where you got the 1.5 times figure.
In order to compute the hourly rate, take the monthly rate and divide by 26 to get the daily rate, then divide by 8 hours to get the hourly rate. This is as per certain court guidelines in other acts that made 26 days as standard working days for every company. You can divide by 30/31 or other methods if you can justify the same, but dividing by 26 is safer. The difference is not significant in most cases.
From India, Mumbai
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In order to compute the hourly rate, take the monthly rate and divide by 26 to get the daily rate, then divide by 8 hours to get the hourly rate. This is as per certain court guidelines in other acts that made 26 days as standard working days for every company. You can divide by 30/31 or other methods if you can justify the same, but dividing by 26 is safer. The difference is not significant in most cases.
From India, Mumbai
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(Fact Check Failed/Partial)-The information provided in the user reply contains inaccuracies regarding overtime pay calculations and the standard working days. The correct calculation for overtime pay and standard working days may vary based on specific laws and company policies.
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Hi SKR,
Please refer to the TN government's Shops and Establishment Act for this purpose. Refer to Section 31 of Chapter VII - Wages. Copy attached. Wages for overtime work-- Where any person employed in any establishment is required to work overtime, he shall be entitled, in respect of such overtime work, to wages at twice the ordinary rate of wages. Also, refer to Rule 10 of the TNSE Rules, 1948 attached.
Rule 10: Manner of calculating the ordinary rate of wages— For the purpose of the Explanation to Section 31, the ordinary rate of wages per hour shall be calculated by dividing the total wages payable to a person employed for the hours actually worked by him during the wage-period by the number of such hours in the wage-period. It is provided that hours worked by a person employed in excess of the normal daily hours during the wage-period shall be excluded in calculating the number of hours actually worked by him.
Please review the attached documents for detailed information.
Thank you.
From India, Bangalore
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Please refer to the TN government's Shops and Establishment Act for this purpose. Refer to Section 31 of Chapter VII - Wages. Copy attached. Wages for overtime work-- Where any person employed in any establishment is required to work overtime, he shall be entitled, in respect of such overtime work, to wages at twice the ordinary rate of wages. Also, refer to Rule 10 of the TNSE Rules, 1948 attached.
Rule 10: Manner of calculating the ordinary rate of wages— For the purpose of the Explanation to Section 31, the ordinary rate of wages per hour shall be calculated by dividing the total wages payable to a person employed for the hours actually worked by him during the wage-period by the number of such hours in the wage-period. It is provided that hours worked by a person employed in excess of the normal daily hours during the wage-period shall be excluded in calculating the number of hours actually worked by him.
Please review the attached documents for detailed information.
Thank you.
From India, Bangalore
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(Fact Check Failed/Partial)-The information provided is mostly accurate. However, the user referred to the Tamil Nadu Shops & Establishment Act for overtime wages guidelines, which may not be applicable to all private sector/BPO industries. It's crucial to consult the specific labor laws and regulations that govern the industry in question for precise guidance.
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(Fact Check Failed/Partial)-The user's reply contains some inaccuracies. The calculation of overtime pay and hourly rate should be based on the relevant labor laws such as the Factories Act or Shops and Establishments Act, not the S & E Act. The method provided for determining the hourly rate is not entirely accurate. It's typically based on the total monthly wage divided by the number of working hours in a month. Specific rules may vary, but there are standard methods for calculating hourly rates under labor laws.