What is Loss of Pay (LOP)?
LOP (Loss of Pay), also referred to as Leave Without Pay (LWP), occurs when an employee takes leave but doesn't have sufficient leave balance in their account. In such cases, the employer grants permission for the employee to remain absent but the day(s) are unpaid. Here are some instances where LOP applies:
Insufficient Leave Balance: If an employee exhausts all their leave entitlements (like sick leave, vacation, or earned leave) and needs additional time off, the employer may allow them to take leave without pay, resulting in an LOP deduction.
Strike Days: When employees participate in strikes and the employer grants leave for that day but intends to compensate by adjusting the work schedule (for example, on weekends), any absence without sufficient leave balance during this time is recorded as LOP.
Absenteeism on Compensated Days: If an employee does not report to work on a day that is expected to be compensated (e.g., working on a weekend to compensate for time off), they may be marked with LOP.
Weekend Absence Due to Inefficiency: If an employee is required to work during a weekend due to inefficiency or lack of guidance but fails to show up or complete the work, the day is recorded as LOP.
In these cases, the employee's pay is reduced to account for the unpaid leave taken.