Dear members,
What is the Correct method for salary calculation(EARNED GROSS) out of these below two methods?
Suppose Gross salary is 3,300/-
for Jan month having 25 working days, 1 NF & 5 sundays (weekly off's)
CASE 1: PERSON IS PRESENT FOR 23 DAYS
CASE 2: PERSON IS PRESENT FOR 2 DAYS ONLY
Method 1 (TRADITIONAL): FOR CASE 1: (3300/31)*29 = 3087/-
FOR CASE 2: (3300/31)*2 = 213/-
Method 2 (as i understood from Payment of Wages act, Factories Act and as told by some labour lawyers also)
For Case 1: (3300/25) *23 + (one day for NF) = 3168/-
For Case 2: (3300/25) *2 + (one day for NF) = 396/-
Kindly give your valuable inputs.
regards
Manish Gupta
From India, Mumbai
5What is the Correct method for salary calculation(EARNED GROSS) out of these below two methods?
Suppose Gross salary is 3,300/-
for Jan month having 25 working days, 1 NF & 5 sundays (weekly off's)
CASE 1: PERSON IS PRESENT FOR 23 DAYS
CASE 2: PERSON IS PRESENT FOR 2 DAYS ONLY
Method 1 (TRADITIONAL): FOR CASE 1: (3300/31)*29 = 3087/-
FOR CASE 2: (3300/31)*2 = 213/-
Method 2 (as i understood from Payment of Wages act, Factories Act and as told by some labour lawyers also)
For Case 1: (3300/25) *23 + (one day for NF) = 3168/-
For Case 2: (3300/25) *2 + (one day for NF) = 396/-
Kindly give your valuable inputs.
regards
Manish Gupta
From India, Mumbai
Hi manish !
As i concern your 1st Method is right i.e.
Method 1 (TRADITIONAL): FOR CASE 1: (3300/31)*29 = 3087/-
FOR CASE 2: (3300/31)*2 = 213/-
if we go for the second method then your monthly salary amount will be Rs. 3564 which is not match with the actual salary..
if some one suggest for the second method then ask him that if some one will present throughout the month his salary will be Rs. 3300/- and when we will be take leave for 2 days salary will be going to Rs.3564/- and what will be the salary structure.
Amiya
From India, Jharsuguda
As i concern your 1st Method is right i.e.
Method 1 (TRADITIONAL): FOR CASE 1: (3300/31)*29 = 3087/-
FOR CASE 2: (3300/31)*2 = 213/-
if we go for the second method then your monthly salary amount will be Rs. 3564 which is not match with the actual salary..
if some one suggest for the second method then ask him that if some one will present throughout the month his salary will be Rs. 3300/- and when we will be take leave for 2 days salary will be going to Rs.3564/- and what will be the salary structure.
Amiya
From India, Jharsuguda
Hi,
Thee r two types of salaries.
1. Daily Wages: physical working days wil be considered except NF&H.
2. Monthly Salary: Need to calculate including sundays.
Exp:
1. Rate per day * physical worked days+NF&H.
2. Fixed gross salary / 30* physical woked days+sundays+NF&H+Payable leaves.
any doughts kindly revert
From India, Bangalore
Thee r two types of salaries.
1. Daily Wages: physical working days wil be considered except NF&H.
2. Monthly Salary: Need to calculate including sundays.
Exp:
1. Rate per day * physical worked days+NF&H.
2. Fixed gross salary / 30* physical woked days+sundays+NF&H+Payable leaves.
any doughts kindly revert
From India, Bangalore
I would like to give some inputs.
I think it depends on how the employment agreement is with the employee. If you have hired him / her with the payment term as "Monthly Salary" or "Annucal CTC" then i think the first method would work.
But if he or she is a labor or contractor who works on "Per Day" basis, then I think the second method would work.
I am not sure if this is correct legally. Comments and criticism are welcome.!
-Ketan
IT_Group
From Germany
I think it depends on how the employment agreement is with the employee. If you have hired him / her with the payment term as "Monthly Salary" or "Annucal CTC" then i think the first method would work.
But if he or she is a labor or contractor who works on "Per Day" basis, then I think the second method would work.
I am not sure if this is correct legally. Comments and criticism are welcome.!
-Ketan
IT_Group
From Germany
Dear amiya,
if someone is present for full 25 days in jan month then his salary will be:
(3300/25) *25 + NF = 3432/-
and if he takes two unpaid leaves then (3300/25) * 23 + NF = 3168/-
and if he takes two paid leaves then (3300/25) * 25 + NF = 3432/-
Dear Mahesh,
kindly go through section 7 of Payment of wages act: which clearly state that Employers are authorized for deduction of wages only for actual period of absence.
Now actual period of absence in my above mentioned cases are 2 and 23.
so wage should be calculated acc. to method no.2.!!!
there is one more thing The act applies only to persons whose gross wage is <=10,000 per month.
regards
Manish Gupta
From India, Mumbai
if someone is present for full 25 days in jan month then his salary will be:
(3300/25) *25 + NF = 3432/-
and if he takes two unpaid leaves then (3300/25) * 23 + NF = 3168/-
and if he takes two paid leaves then (3300/25) * 25 + NF = 3432/-
Dear Mahesh,
kindly go through section 7 of Payment of wages act: which clearly state that Employers are authorized for deduction of wages only for actual period of absence.
Now actual period of absence in my above mentioned cases are 2 and 23.
so wage should be calculated acc. to method no.2.!!!
there is one more thing The act applies only to persons whose gross wage is <=10,000 per month.
regards
Manish Gupta
From India, Mumbai
Hi
Registed Company has to make as per Payment of Wages & Factories Act
in the above case 1st method is correct.
second method is like cheting the innocent /or/ noncensing the staff.
pl. do follwo the 1st method, staff welfare is must company to come up & establish,so that trained worker/staff will long lost for industry & ther will not stain/pain to execute thinks/work.
thanks
srs
From India, Bangalore
Registed Company has to make as per Payment of Wages & Factories Act
in the above case 1st method is correct.
second method is like cheting the innocent /or/ noncensing the staff.
pl. do follwo the 1st method, staff welfare is must company to come up & establish,so that trained worker/staff will long lost for industry & ther will not stain/pain to execute thinks/work.
thanks
srs
From India, Bangalore
Dear All,
Amiya is absolutely right and I am also suggesting the first (Traditional) method of calculating the wages per month.
And also it depends upon that the company is paying on the basis of the Daily rate bases or on the monthly basis. ?????
But according to the calculation and all other things, the first method is surely suitable and easy.
From India, Pune
Amiya is absolutely right and I am also suggesting the first (Traditional) method of calculating the wages per month.
And also it depends upon that the company is paying on the basis of the Daily rate bases or on the monthly basis. ?????
But according to the calculation and all other things, the first method is surely suitable and easy.
From India, Pune
I have a different take on this - and this has been implemented successfully.
1. Usually, a month has 4 weeks (7x4=28) + 2 working days (or 3 in case of 31 days).
2. 4 weeks have 24 working days + 4 weekly (mandatory) offs.
3. 24 working day + 2 (3) days = 26 (27) working days per month.
4. The Gross divided by 26 (in this case it is 3300/26 = Rs 127 per day).
5. Days-without-pay will entail loss of pay calculated on the the daily pay, ie Rs 127. Also, if a employee join the orgn mid-way of the month, his wages will be calculated on this daily amount.
6. A month, in many organisations and even by the Govt, is 30 days.
7. Many Managements' see this basic calculation results in small benefit of the employees and, without upset the fin budget, increases the morale of the work-force.
8. As HR, we must put up various solutions (as given in these col) and get approved.
Rajusiachen
From India, Coimbatore
1. Usually, a month has 4 weeks (7x4=28) + 2 working days (or 3 in case of 31 days).
2. 4 weeks have 24 working days + 4 weekly (mandatory) offs.
3. 24 working day + 2 (3) days = 26 (27) working days per month.
4. The Gross divided by 26 (in this case it is 3300/26 = Rs 127 per day).
5. Days-without-pay will entail loss of pay calculated on the the daily pay, ie Rs 127. Also, if a employee join the orgn mid-way of the month, his wages will be calculated on this daily amount.
6. A month, in many organisations and even by the Govt, is 30 days.
7. Many Managements' see this basic calculation results in small benefit of the employees and, without upset the fin budget, increases the morale of the work-force.
8. As HR, we must put up various solutions (as given in these col) and get approved.
Rajusiachen
From India, Coimbatore
Mr. Manish
First we have to understand following points.
As per Factory act one paid leave is compulsory on completion of 48 hours work it means sunday treated as paid leave, paid leave means consider in numbers of days in a month, therefore when we calculating salary consider 30 days for permanent employee and for temporary worker consider 26 days as in this case salary given on numbers of day worked.
This is my view...
Mitesh
From India, Ahmadabad
First we have to understand following points.
As per Factory act one paid leave is compulsory on completion of 48 hours work it means sunday treated as paid leave, paid leave means consider in numbers of days in a month, therefore when we calculating salary consider 30 days for permanent employee and for temporary worker consider 26 days as in this case salary given on numbers of day worked.
This is my view...
Mitesh
From India, Ahmadabad
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Method of calculation of wages.doc
SALARY SHEET CALCULATION.xls