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January: Expectation: Reality

The document discusses how employees' monthly salaries are being calculated incorrectly by using a standard divisor of 21.75 days per month instead of adjusting the divisor monthly based on the actual number of working days. This results in employees not receiving their full expected compensation. It proposes that the daily rate should be calculated using the actual number of working days in a month as the divisor. An example for January is provided showing the expected pay is higher than reality due to using 21.75 days as the divisor instead of the actual 20 working days that month. Adjusting the divisor monthly would ensure employees receive their fair and full wages as stipulated in their contracts.

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Derixk Star
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186 views3 pages

January: Expectation: Reality

The document discusses how employees' monthly salaries are being calculated incorrectly by using a standard divisor of 21.75 days per month instead of adjusting the divisor monthly based on the actual number of working days. This results in employees not receiving their full expected compensation. It proposes that the daily rate should be calculated using the actual number of working days in a month as the divisor. An example for January is provided showing the expected pay is higher than reality due to using 21.75 days as the divisor instead of the actual 20 working days that month. Adjusting the divisor monthly would ensure employees receive their fair and full wages as stipulated in their contracts.

Uploaded by

Derixk Star
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as RTF, PDF, TXT or read online on Scribd
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We do not work 261 days in a year because we are mandated not to work in some plotted

holiday offs. Granting that we only worked 250 days in a year, then the factor 21.75 should no longer
apply. Despite the fact that we are not reaching the 261 working days in a year, our monthly salary is still
divided by the standard 21.75 divisor causing us to fall short of our expected monthly compensation
notwithstanding the months where we do not even have any absences nor tardiness. This method of
calculation has a negative impact on the employee's financial relationship with the company since it
prevents the employee from receiving the wage stipulated in his/her contract. This calculation has
deprived the employees of their right to fair wages.

We respectfully submit that the daily rate should rather be adjusted in a monthly basis, since we
are not following the standard 261 working days. Using the 21.75 divisor would result to unfair
calculation resulting to the diminition of employees monthly wages.

See the illustration below:

January
Working Days for January = 21 days

1 Holiday off and 1 Call in = 19 days worked

1 Holiday off without Call in = 20 days

The divisor that should be used is 20 days (we still include the day of call in).

Therefore: 17,000 / 20 = P850.00 Daily Rate (January only)

1,000 / 20 = P50.00 TL Allowance (January only)

1,200 / 20 = P60.00 WFH Allowance (January only)

Jan 1-15 cut off (9 days)

I only worked for 9 days since I was asked to have Jan 1 as my holiday off. It follows that the 261 days no
longer applies. Hence we should used the number of working days for January (20 days) as the actual
divisor.

Expectation: Reality:
Basic Rate: 850 x 9 = 7,650 Php Basic Rate: 781.61 x 9 = 7,034.49 Php
TL Allow: 50 x 9 = 450 Php TL Allow: 1,000 / 21 = 428.57 Php
WFH Allow: 60 x 9 = 540 Php WFH Allow: 1,200 / 21 = 514.29 Php
Unworked Reg Holiday: 850 Php Unworked Reg Holiday: 781.61 Php
Gross Pay: 9,490 Php Gross Pay: 8,758.96 Php
Medical/ER Reimbursement: 3,303.32 Medical/ER Reimbursement: : 3,303.32
9,490.00
- 8,758.96
Difference: 731.34

Jan 16 -30 cut off (10 days)

Expectation: Reality:
Basic Rate: 850 x 10 = 8,500 Php Basic Rate: 781.61 x 10 = 7,816.10 Php
TL Allow: 50 x 10 = 500 Php TL Allow: 1,000 / 21 = 476.19 Php
WFH Allow: 60 x 10 = 600 Php WFH Allow: 1,200 / 21 = 571.43 Php
Gross Pay: 9,600.61 Gross Pay: 8,863.72 Php
9,600.00
- 8,863.72
Difference: 736.28

January Rate (20 Days + 1 Regular Holiday Unworked)

Expectation: Reality:
Basic Rate: 850 x 19 = 16,150 Php Basic Rate: 781.61 x 19 = 14,850.59 Php
TL Allow: 50 x 19 = 950 Php TL Allow: 47.619 x 19 = 904.76 Php
WFH Allow: 60 x 19 = 1,140 Php WFH Allow: 57.14 x 19 = 1085.72 Php
Unworked Reg Holiday: 850 Php Unworked Reg Holiday: 781.61 Php
Gross Pay: 19,090 Php Gross Pay: 17,622.68 Php

Net Pay: 19,090 - (Deductions) Net Pay: 16,448.34

We grant that we worked the complete number of working days in January, including the
regular holiday in Jan 1. This means that we are still in congruent with the 261 working days in a year
hence the 21.75 divisor can safely be used.

Basic Rate: 781.61 x 20 = 15,632.2 Php


TL Allow: 47.619 x 21 = 1,000 Php

WFH Allow: 57.14 x 21= 1,200 Php

Worked Reg Holiday: 781.61 x 2 = 1,536.22

Gross Pay: 19,368.42 Php

Basic Rate: 17,000 Php


TL Allow: 1,000 Php
WFH Allow: 1,200 Php
Unworked Reg Holiday: 850 Php
Gross Pay: 20,050 Php

However, we were not able to fulfill the 261 days making it absurd to still use it as a basis in
identifying our daily rate. Using the higher divisor of 21.75 makes it impossible for us to reach our
stipulated monthly salary.

Therefore, we stand in our belief that our daily rate should be computed using a monthly-based
divisor which in this case should be 20 for us to get our monthly salary. In my case, I only reached
17,622.68 gross pay as opposed to my expected monthly salary. Following the expected computation
above, I could have reached 19,090 for January considering that I had 1 call in.

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