Is it required to calculate overtime pay based on gross pay? Otherwise, can we calculate only on Basic + DA?

manikumar-kuncham
Is it required to calculate overtime pay based on gross pay? Otherwise, can we calculate only on Basic + DA?
Madhu.T.K
OT is to be calculated on the average wages per day. If you have fixed components of salary which are paid when an employee is on leave with pay or deducted when he is on leave without pay, that component should also be taken as base for overtime payment. HRA as a component of salary which is not paid when an employee is on leave without pay is definitely a component of wages to be considered for overtime payment. At the same time, house rent allowance paid to certain employees either along with salary or by means of payment directly by the employer to the landlord is purely an allowance which cannot be considered for overtime payment, gratuity calculation, leave enhancement etc.
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