Loss of Pay (LOP) refers to the salary deduction applied when an employee exceeds their allotted paid leave or takes unapproved leave. Industries like manufacturing, retail, logistics, e-commerce, and facility management services (FMS) implement LOP policies to ensure payroll accuracy, attendance discipline, and compliance with company leave policies. LOP is typically calculated based on daily wage structures and directly impacts an employee’s monthly earnings.

For companies managing contract workers, gig employees, apprentices, and blue-collar workforce, a clear LOP policy helps in monitoring absenteeism, maintaining workforce productivity, and ensuring smooth payroll processing. By using automated leave and payroll management systems, businesses can track LOP days, prevent salary disputes, and enhance transparency in employee compensation. A well-structured LOP framework ensures fair salary deductions while maintaining workforce efficiency.