What is Loss of pay (LOP)?
Short answer
Loss of pay is a deduction from salary for days an employee did not work and had no paid leave. Salary is paid only for the payable days out of the month’s working days.
Effect on payroll
- Basic, HRA and allowances are reduced in proportion to the unpaid days.
- PF, ESIC and professional tax follow the reduced wages.
- The days without pay are reported to EPFO as non-contributory days in the ECR.
In AdviHR
AdviHR works out loss-of-pay days from attendance, leave and joining or leaving dates, and the payroll check flags unusually many.
Frequently asked questions
How is LOP calculated?
Salary × payable days ÷ working days in the month.
Related terms
How sure are we? These figures use the same rules AdviHR payroll applies. We publish what has been checked against an official source and what has not, on the statutory accuracy page.
General information, not legal or tax advice. Confirm against the official notification and your adviser.