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What Is LOP (Loss of Pay) in Salary? How to Calculate It

LOP is a salary deduction for days treated as unpaid. Learn the calculation and what to check when the divisor, salary components or days counted are unclear.
From TheFinanceBase Team3 min to read
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LOP means “loss of pay”: a salary deduction for days your employer treats as unpaid. A useful estimate is (salary basis ÷ payroll divisor) × LOP days. The divisor and the salary components used in the calculation depend on your employer’s payroll policy; there is no single universal monthly LOP formula established by the official sources reviewed.

What does LOP mean in salary?

LOP, or loss of pay, is the amount deducted when an absence is treated as unpaid. Payroll guides describe common triggers such as being absent without approved leave or taking leave after your available balance is exhausted. It is different from approved paid leave, which is not treated as unpaid under the employer’s leave rules.

An LOP entry on a payslip reflects how payroll classified one or more days. Whether that classification is correct depends on your attendance record, leave approval and employer policy.

How to calculate LOP deduction

Start with this estimate:

LOP deduction = (salary basis ÷ divisor) × LOP days

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The salary basis is the salary amount payroll uses for this calculation. The divisor converts that amount into a per-day figure. Payroll guides describe calendar-day, fixed-30-day and working-day approaches, but no one divisor is established as mandatory for every monthly-paid employee. Ask payroll which basis and divisor apply to you.

Example: ₹50,000 salary basis and 3 LOP days

These examples, presented by WorkCalcs, show how the divisor changes the estimate. They are illustrations, not a standard or legal rule.

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Divisor used Calculation Estimated deduction
30 days ₹50,000 ÷ 30 × 3 ₹5,000
31 calendar days ₹50,000 ÷ 31 × 3 About ₹4,839
26 working days ₹50,000 ÷ 26 × 3 About ₹5,769

The values differ because the daily rate changes with the divisor. A calculation may also differ if payroll uses a different salary basis or counts the days in another way. WorkCalcs’ LOP calculation guide and a supporting payroll guide describe these policy-dependent approaches.

What can change the amount?

  • Salary components in the base: Do not assume payroll uses gross salary or basic pay. The components included depend on policy and payroll setup; check your employer’s written rules and payslip.
  • Which days count: Weekly offs and holidays may be treated differently across policies. Confirm whether they were included in the LOP-day count.
  • Attendance or leave corrections: If an absence is later corrected or leave is approved, ask when the adjustment will appear and how it will be shown on your payslip.

How to check an LOP deduction on your payslip

  1. Confirm the days: Ask payroll how many days were recorded as LOP and compare that count with your attendance record and leave approvals.
  2. Ask for the calculation inputs: Request the salary basis and divisor used, and ask whether weekly offs or holidays were included.
  3. Compare with written policy: Check your employment terms and leave policy for the applicable leave rules and calculation method.
  4. Follow up on corrections: If your attendance or leave status changed, ask when payroll will adjust the deduction and how the correction will appear.
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Is there a universal legal formula for monthly LOP?

The official sources reviewed provide wage-law context, but do not establish one universal divisor or calculation formula for monthly LOP deductions. India Code identifies the Code on Wages, 2019 as an Act enacted on 8 August 2019 and lists specified provisions notified on 18 December 2020. The Chief Labour Commissioner’s Payment of Wages page discusses claims concerning wage deductions under the Payment of Wages Act framework. Neither source answers whether a particular employer’s divisor or treatment of a particular absence is lawful.

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If you dispute a deduction, keep your itemized payslip, attendance record, leave requests and approvals, and the applicable employment and leave policies. You can raise the issue with payroll and, if it remains unresolved, consult an appropriate labour authority or adviser. Check current official notifications for legal implementation details. India Code: Code on Wages, 2019; Chief Labour Commissioner: Payment of Wages.

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