Managing salary calculations for employees during incomplete months can be a perplexing task. Whether you're onboarding new hires mid-month, managing no-pay leave, or facing other scenarios leading to incomplete salary periods, worry not! In this guide, we will equip you with the necessary knowledge to calculate an incomplete month’s salary with ease, ensuring accurate remuneration for your employees.
What are some reasons that may lead to an incomplete month of work?
It is not uncommon for your employees to clock in an incomplete month of work. Here are some scenarios where partial months may occur:
- Onboarding new hires mid-month: Your new employee may join your company after the first day of the month.
- Offboarding employees mid-month: An employee may also leave your company before the last day of the month, depending on when they serve their notice periods.
- Employees taking no-pay leave: Occasionally, your employee may need to take no-pay leave to manage personal emergency matters.
- Reservist training obligations: For employees who are Operationally Ready National Servicemen (ORNS or NSmen) or SAFVC Volunteers (SV), they may be required to attend reserve training within the month.
How do I calculate the salary for an incomplete month?
According to the Ministry of Manpower (MOM), the formula to calculate salary for an incomplete month is:
(Monthly gross rate of pay) ÷ (Total number of working days in that month) x (Total number of days the employee actually worked in that month)
Let’s dive deeper into each key component and its respective definition:
- Monthly gross rate of pay: The monthly gross rate of pay refers to the total amount of money payable to an employee for one month's work. This figure excludes various additional payments such as overtime, bonuses, AWS (annual wage supplement), reimbursement of special expenses incurred during employment, productivity incentive payments, travel allowances, food allowances, and housing allowances.
- Total number of working days in the month: The total number of working days in a given month excludes rest days and non-working days but includes public holidays.
- Total number of days the employee actually worked: The number of days the employee actually worked, encompassing public holidays, paid hospitalisation leave, and annual leave, if entitled.
Now that we’ve understood the definitions of the key components, let's consider a practical example to illustrate how the salary calculation formula works for an incomplete month.
Example to calculate salary for an incomplete month
Sarah is an employee working at a tech startup in Singapore with a 5-day work week. Sarah joined the company on 15 June 2023, and her monthly gross rate of pay is SGD 4,500. The month of June has 30 days, with 2 public holidays (2 June - Vesak Day and 29 June - Hari Raya Haji).
To calculate Sarah's salary for the incomplete month of June, here are the steps:
Step 1: Calculate the total number of working days in June 2023
The total number of working days in June 2023 is 22 days, including 2 public holidays.
Step 2: Calculate the total number of days Sarah actually worked in June
The total number of days Sarah actually worked = 11 days + 1 public holiday (29 June) = 12 days
Step 3: Calculate Sarah’s salary for the incomplete month of June
Salary for the incomplete month = (Monthly gross rate of pay) ÷ (Total number of working days in that month) x (Total number of days the employee actually worked in that month)
Sarah's salary for June = SGD 4,500 ÷ 22 x 12 ≈ SGD 2,454.55 (rounded to two decimal places)
What is the monthly total number of working days in 2023?
Here’s a useful table that you can use to quickly determine the monthly total number of working days in 2023, depending on your company’s working schedule.
| || || || ||Total number of working days in the month
|Calendar Month||Calendar Days||Number of Sundays||Number of Saturdays||5-day work week||5.5-day work week||6-day work week
- The number of working days in the month includes the public holidays that fall on a normal working day but excludes rest days and non-working days.
- Half day work is on a Saturday, and Sunday is the default rest day.
- The 6th working day is on a Saturday, and Sunday is the default rest day.
Is there a prorated salary calculator?
We understand that calculating an incomplete month’s salary for your employees can be confusing and error-prone. This is why we’ve created a free Salary Proration Calculator to help you calculate your employees’ prorated salary for the month! It takes into account the following:
- Singapore Public Holidays are included.
- An incomplete month's salary is calculated based on working days in the month.
- Option for those who work half days on Saturdays.
Simplify the calculation of incomplete month's salaries for your employees with Payboy HR software!
Need more complex calculations, especially if you are managing a large team of employees? Our Payboy payroll module is here to help! With our fully compliant, customisable, and integrated payroll processing module, you can automate the calculation of an incomplete month’s salary and also enjoy additional features that are designed to save you time and effort:
- 100% compliance and 100% peace of mind
- Forget about payroll and levy calculations, CPF contributions, and IR8A submissions. Our software will automatically calculate them for you and keep you compliant with the latest regulations from MOM, CPF, and IRAS.
- Covers any work arrangement
- Working with full timers, part timers, freelancers, and contract staff? We’ll take care of the unique payroll requirements for each working arrangement.
- Transparent, Accurate, and Simple
- Have full visibility on how payroll is calculated automatically based on shifts, attendance, leave, and submitted claims within an intuitive experience.
- Customisable itemised payslips
- Automatically generate itemised payslips for your employees.
- Fully integrated with your preferred platforms
- We’ll fit into your ecosystem seamlessly and keep your finance team happy. Learn more about our seamless integrations with Xero, Financio, and Quickbooks.
Streamline your HR processes with Payboy today!
As a PSG-approved HRMS, Payboy provides a robust system to help you manage your HR tasks so that you can focus on your business and people!
With our wide range of modules, you can customise a solution to meet the specific needs of your business:
Payroll Processing | Leave Management | Claims Management | Applicant Tracking | Time Attendance | Shift Scheduling | Appraisal System | Inventory Management | Project Costing | Training Management | Benefits