Three divisor methods and when each applies
The calendar-day method divides monthly salary by the actual days in the month, so a day of absence costs less in a 31-day month than in February. The fixed-30 method uses 30 every month for simplicity and is common for monthly-rated office staff. The 26-day method reflects paid working days after four weekly offs and is the standard for minimum-wage and daily-rated workers, because state minimum wage notifications are expressed per day and monthly figures are the daily rate multiplied by 26.
The choice changes the deduction materially. On a ₹26,000 gross in a 31-day month, one LOP day costs ₹838.71 by calendar days, ₹866.67 by 30 days, and ₹1,000 by 26 days. Write the method into the attendance and payroll policy and apply it to every employee in the same category.
- Calendar days: fairest month to month for salaried staff, but fluctuates
- Fixed 30: simple and predictable for monthly-rated employees
- 26 days: matches minimum-wage notifications and daily-rated payroll
- Half day = 0.5 LOP day unless your policy defines it by hours
What LOP does to statutory deductions
Loss of pay reduces the earned basic and DA, and provident fund is calculated on earned wages, so PF falls in an LOP month. ESI eligibility is based on the contracted gross, not the reduced amount, so an employee under the ₹21,000 ceiling stays covered even in a heavy-LOP month. Professional tax slabs are applied to the salary actually paid in most states. The salary-sheet template on this site carries these effects through automatically.