Page 103 - DCOM207_LABOUR_LAWS

Labour Laws

Notes 6.4 Method for Computation and Fixing of Wages

There are two methods for Computation and Fixing of Wages:

6.4.1 Monthly Wages

For the purpose of calculating salary, a ‘month’ or ‘complete month’ refers to any one of the
months in the calendar year.
An incomplete month of work is one where an employee:

l z starts work after the first day of the month;
l z leaves employment before the last day of the month;
l z takes no-pay leave of one day or more during the month; or
l z is on reservist training during the month.
Salary payable to a monthly-rated employee for an incomplete month of work is calculated using
the formula below:
Monthly gross rate of pay
Salary payable for Total number of days
incomplete month = Total number of working x the employee actually
of work worked in that month
days in that month
Refers to the total amount of money including allowances payable to an employee for working
for one month, excluding:
(a) Additional payments by way of:

™ z overtime payments;
™ z bonus payments; or
™ z annual Wage Supplements;
(b) Any sum paid to the employee for reimbursement of special expenses incurred by him/her
in the course of employment;
(c) Productivity incentive payments; and
(d) Travelling, food or housing allowances.
Excludes rest days, non-working days but includes public holidays. For employees, with a fixed
rest day on Sunday and/or non-working day on Saturday, the total number of working days per
month.
If the number of working hours in any working day is five hours or less, it shall be regarded as a
half-day. If it is more than five hours, it shall be regarded as one working day.

6.4.2 Daily Basis

Daily basis of wages can be further categorized into Basic Rate of Pay and Gross Rate of Pay.

Basic Rate of Pay

Did u know? There are two ways to calculate daily wages: the basic rate of pay, and the
gross rate of pay.

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