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What Is LOP (Loss of Payment)? | Overview – CloveHRMS

An organization may grant employees a leave request after consuming all their paid leaves. In that case, they will get LOP for those leaves.

It means the employee will not get their salary for the day(s) they took off as they have no remaining leaves in their leave balance. LOP is calculated based on an employer’s everyday salary.

However, if an employee works an extra day to compensate for their inefficiency, that day is also considered LOP.

Overview of LOP (Loss of Payment)

LOP or Loss of Pay is the type of leave granted to employees if they have no remaining paid leave in their leave balances. This implies that your employer will allow you to take a leave from your shift even though you have no paid leave in your balance. Thus, you will not get paid for those days.

In some companies, any leave or day off taken by violating the company’s leave policy is considered a LOP. There are other cases too. An employer may grant a leave if the employee compensates for that day by working on the weekend or a strike. However, if the employee fails to show up or log in on the said day, even after taking leave earlier, they will be given a loss of pay.

Furthermore, if an employee works on the weekend to finish their pending task because of their lack of supervision and inefficiency, that day, too, is considered a LOP.

Vital Factors of LOP

These are a few factors you must keep in mind while learning about LOP:

  • If an employee works on an annual contract, their yearly pay will be considered during their loss of pay calculations. However, it depends on the corporate policy.
  • A company may suffer if an industrial employee managing a crucial and dangerous responsibility takes a day off. In that case, they are not granted LOP.
  • Sometimes, employees in higher positions are not granted LOP.
  • Employees who take leave for more than 6 months due to sickness, poor attendance record, or failure to meet the company’s goal may be given LOP.

It is better to talk to the HR department in your office to learn more about your company HR leave policy and LOP.

LOP Calculation

You might get confused about the LOP calculation and wonder how much money would be deducted from your salary.

LOP is calculated on a day-to-day salary basis. Here’s how you can calculate your LOP:

LOP= Effective one-day salary * Total number of day-offs taken

Let’s see how you can calculate your daily salary:

Daily/ Per day salary= Total salary/ Total number of days in one month

If your company accounts for the weekend, the total number of weekend days will be deducted from the number of days in one month.

Good to Read:- Full Form of CL Leave | What Is Casual Leave?

What can be the Probable Cause of LOP?

LOP depends on several factors. Generally, these are the following factors where an employee gets LOP:

  • Sudden sickness/ Accidents
  • Leave without prior notice
  • Other emergency leaves

If you take a day off for a doctor’s visit or bank visit, or a relative’s sickness without prior notice, you may receive LOP.

How to Avoid LOP?

You can avoid LOP if you keep the following points in mind and act accordingly:

  • Give your management prior notice of your leave.
  • Work overtime to compensate for your leave on time.
  • Avoid unnecessary leaves.
  • Keep track of your leave balance and do the needful accordingly. 

You may face financial issues at the end of a month if you receive LOP in attendance. So, use your leaves carefully.

Wrapping Up

This was a short note on LOP in HR. Use this blog post as your LOP guide and keep track of your leave balance accordingly. Please keep in mind that LOP can affect your overall performance at your workplace and may cause hindrances in your career growth.