HR & payroll glossary
What is LOP?Loss of Pay
LOP (loss of pay) is unpaid absence. Salary is reduced in proportion to the days of LOP, which also reduces PF, ESI and other wage-linked amounts.
Definition
Loss of Pay applies when an employee is absent without paid leave to cover it, or takes leave the policy treats as unpaid. The month's salary is prorated for the payable days.
How it works
- Payable days = days in the pay period − LOP days (the divisor, calendar days or a fixed 26 or 30, is a policy choice).
- Each earning component is reduced in proportion, and wage-linked statutory contributions fall with it.
- LOP discovered after payroll closes is usually reversed or recovered in a later month as an arrear.
Why HR and payroll teams care
LOP depends on attendance and leave being final before payroll runs. Late regularisations are the main reason for LOP reversals.
Example
Gross ₹31,000, 31-day month, 2 LOP days
- Payable days = 29
- Gross payable = ₹31,000 × 29 ÷ 31 = ₹29,000
LOP in NeevHR
Related reading
See how NeevHR handles LOP in payroll and HR
A walkthrough on your own policies and pay structures.