Incomplete Monthly Salary: How To Calculate Your Wages.
How do you calculate an incomplete monthly salary when you join or resign from a Company? If you served the full month, the Company would pay you the full monthly salary as agreed in the employment contract. No brainer.
But what happens when you don’t serve the full month? How do you calculate your wages? Let’s take a look at the formula and some sample calculations.
Formula for Incomplete Monthly Salary.
When you join or exit an organization during any period of the month, the salary needs to be prorated.
Since you are a monthly salaried employee, a pro-rated salary follows the number of days in the calendar month.
Here is the formula:
(Monthly salary X Number of days employed in the month) / Number of days in the month.
It does not matter if that month has 30 days or 31 days, your full monthly salary will be divided against the number of days in that particular month.
The number of days employed includes Saturday and Sunday.
That is how you get your incomplete monthly salary.
Sample Incomplete Monthly Salary for New Joiners.
In this example, the employee whose salary is RM1500 (which is the minimum salary in Malaysia), joins the company on 12th September 2024.
(RM1500 X 19 days employed) / 30 days (September) = RM950
What About Fixed Allowances?
Fixed allowances follow the same formula. Let’s assume that you get a monthly transport allowance of RM500 and a meal allowance of RM150. Following the same example above, here is the calculation:
Transport allowance: (RM500 X 19 days) / 30 days = RM316.70
Meal allowance: (RM150 X 19 days) / 30 days = RM95
Therefore, your entire monthly gross salary for September will be RM950 + RM316.70 + RM95 = RM1361.70
Sample Incomplete Monthly Salary for Resignation.
Your last at work is on 15th September 2024. Your basic salary is RM5000, and you have a fixed transport allowance of RM500.
Basic Salary: (RM5000 X 16 days employed) / 30 days = RM2666.70
Transport allowance: (RM500 X 16 days employed) / 30 days = RM266.70
The gross salary that you will get in your last month at work is RM2666.70 + RM266.70 = RM2933.40
Conclusion
Is this the only way to calculate an incomplete monthly salary? It is not! Companies can use different ways to calculate incomplete wages. However, the final amount cannot be less than what is calculated from the formula above. This formula is the minimum requirement. Anything more is good and less is against the law.
