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How to calculate unpaid leave deduction pay (SG)
How to calculate unpaid leave deduction pay (SG)
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Written by StaffAny
Updated this week

Contents of this article are applicable to the following users

Tier: N/A

Product: Payroll

Platform: Web

Our payroll now synchronizes with the leave engine where unpaid leave can be pulled into payroll.

This guide will cover the following:


Things to prepare before processing payroll

Before processing payroll you need to:

  1. Make sure that Unpaid Leave is properly setup as the following:


    Make sure that “Working Days” and “Unpaid Leave” are set to “Yes
    If you haven’t set up Unpaid Leave, go to Settings > Off and Leave > Add Leave.

  2. All unpaid leaves within the month are approved or properly assigned to staff on schedule or timesheet.

  3. Create a pay item with the following setting:

    1. Pay item name: Unpaid Leave
      Note: Pay item name can be changed to your preference.

    2. Category: Gross Deduction

    3. CPF Type: Ordinary Wage

    4. IR8A code: Gross Salary

    5. Amount type: Attendance based

    6. Timesheet column: Unpaid leave days

    7. Rate: Incomplete Month Pay Daily Rate (Singapore)
      Where: Incomplete Month Pay Daily Rate = Monthly gross rate of pay ÷ Total working days in a month.

    8. Multiplier: 1

  4. (optional) Assign staff who are eligible for unpaid leave to the corresponding pay item. Learn more on how to tag pay item to staff.

    During payroll, staff will have “unpaid leave” deduction automatically.


After creating a payroll

If staff already tagged to pay item

Each staff will have “unpaid leave” in their payroll details if they are already tagged to the “Unpaid Leave” pay item.

If staff not tagged to pay item (manual add)

  1. Find staff who took unpaid leave on Timesheet

  2. When you edit the payroll, click on the “Add Pay Item” dropdown and select “Unpaid Leave”.


How to manually calculate unpaid leave deduction

Unpaid leave deduction will be based on the Monthly Gross Rate of Pay. The formula for Unpaid Leave Pay might depends on your organization policy. Here's the recommended calculation by MOM:

(Total days of unpaid leave taken within the period ÷ Total working days in that period) x Monthly Gross Rate of Pay

Example:

  • Period: 1 June 2024 - 30 June 2024

  • Staff’s working days per week: 5 days

  • Total working day in the period: 20 days

  • Total days of unpaid leave taken: 3 days

  • Staff’s monthly gross rate of pay: $1,000

  • Unpaid leave deduction in the period = (3 days ÷ 20 days) x $1,000 = $150

Note: When calculating the gross rate of pay, ensure that all allowances except for travel, food, and housing allowances are included.

Alternatively you can use MOM Calculator for more accurate calculation.

FAQ

Q: My staff joined the company in the middle of the month, how does the system calculate it?

A: If a staff joined in the middle of the month:

  1. The system will automatically prorate via Days Worked/Working Days settings that's being set into that specific staff.

  2. Days worked means that the staff have a Clock In/Clock Out records or a paid leave taken/assigned on that specific period.

  3. So if there's an Unpaid Leave on that period, it will not be counted towards day worked.

So our recommendation for such case is that you do not tag Unpaid Leave deduction pay item for new joiner at least until they're done with their first month period.

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