Why it matters
Salary is the one thing every staff member checks carefully. If attendance is not clear, month end turns into arguments about late days, half days and leave. A simple, written method, applied the same way to everyone, avoids most of these fights.
Step 1: Decide how you count a day’s pay
For staff on a fixed monthly salary, you first need a per-day rate. Businesses usually pick one of these:
- Days in the month: divide the salary by 28, 29, 30 or 31, depending on the month.
- A fixed 30 days: divide by 30 every month, which keeps the maths simple.
- Working days only: divide by the number of working days, for example 26.
Choose one method, write it in the appointment letter, and use it for everyone.
Step 2: Count the paid days
Paid days are the days you pay for. They normally include days present, approved paid leave, weekly offs and holidays on your holiday list. Days absent without approved leave are “leave without pay”.
Step 3: Work out the salary
Multiply the per-day rate by the paid days, or subtract the unpaid days from the full salary. Both give the same answer.
| Monthly salary | ₹18,000 |
|---|---|
| Days in the month | 30 |
| Per-day rate | ₹18,000 ÷ 30 = ₹600 |
| Leave without pay | 2 days |
| Salary for the month | ₹18,000 − (2 × ₹600) = ₹16,800 |
Step 4: Late marks and half days
Many businesses set a clear rule for late arrivals, for example a set number of late marks counting as a half day. Whatever your rule is, share it with staff in advance and apply it the same way every month.
Step 5: Pay and keep a record
Pay by cash, UPI or bank transfer and keep a record of every payment. A payslip that shows paid days, unpaid days and the reason for each cut answers most questions before they are asked.
A note on PF, ESI, professional tax and TDS
Depending on your business size, state and each person’s salary, deductions such as PF, ESI, professional tax and TDS may apply. These rules change, so please check with your CA.
How Cadence helps
Cadence records attendance with a selfie and location from each staff member’s phone, applies your leave rules and holiday list, and works out salary from actual attendance, with every unpaid day and its reason shown. Payslip PDFs are available on Business and Enterprise plans. PF, ESI, professional tax and TDS are not added to payslips yet.
This guide is general information to help business owners. For legal, tax or compliance decisions, please check with a qualified professional.