Payroll for schools

Salary structures in schools

Larger CBSE and ICSE schools often pay teachers on a pay-scale pattern, with basic pay, dearness allowance, HRA and a transport allowance, plus annual increments. Smaller schools pay a consolidated monthly amount. Under the Code on Wages, basic pay plus dearness allowance must be at least half of total remuneration. A consolidated salary split into a small basic and a large special allowance therefore needs a second look, because the excess is added back to wages for PF, gratuity and bonus. See the 50 percent wage rule.

• Basic pay and DA at least half of total pay
• HRA and transport allowance for teaching and office staff
• Consolidated pay for ayahs, peons and guards, split correctly
• Fee concession for staff children tracked outside payroll

Vacation months, joiners and leavers

Teachers on the regular rolls are paid through summer vacation, because vacation days are holidays, not leave without pay. Trouble starts with contracts that end in April and restart in July, which leave a teacher unpaid for the vacation and invite disputes about continuity of service. A teacher who joins on 20 June is paid from the joining date. One who leaves on 10 May is paid up to the last working day, with wages settled within two working days of leaving. Fix the loss of pay basis once, such as calendar days or a fixed 30 days, and use it for every teacher.

Worked example: a teacher's month

Priya, a TGT, has a gross salary of ₹36,000: basic ₹18,000, DA ₹3,600, HRA ₹9,000 and special allowance ₹5,400. Basic plus DA is ₹21,600, which is 60 percent of gross, so the structure meets the half rule. In November she took two days of leave without pay. The school uses a fixed 30-day basis, so one day is worth ₹1,200 and her gross for the month is ₹36,000 minus ₹2,400, or ₹33,600. PF on her basic plus DA, ESI if her wages fall within its limit, and the state's professional tax come off next. The PF calculator shows the PF split.

Month-end inputs and paying by the 7th

The inputs that change a school payroll each month are small but frequent: arrears after a pay revision approved by the management, an incentive for teachers who took extra classes for board students, overtime for drivers and guards, recovery of a salary advance, and any other deduction your rules allow. Collect inputs by the 1st, close attendance by the 3rd, review the draft run with the principal and the accountant, and finalize by the 5th. Wages must be paid by the 7th of the following month, whatever the fee collection position.

How to set it up in ZeniaHR

1. In Direct Payroll, set each salary structure from monthly gross, split into Basic, DA, HRA and Special by company percentages, keeping Basic plus DA at half or more.
2. In the deduction policy, choose the loss of pay basis and the half-day pay fraction, and decide whether weekly offs and holidays are paid, with branch overrides if needed.
3. Close the attendance month first, so paid days come from finalized attendance and stay within each teacher's joining and exit dates.
4. Enter monthly payroll inputs such as arrears, incentive, overtime, advance recovery and fines before moving the run from draft to review.
5. Finalize the run after the principal and the accountant have reviewed it; the run is then sealed and each employee gets a payslip PDF showing PF, ESI and professional tax.
6. Create a payment batch, move it from draft to approved to paid, and release salaries by the 7th of the following month.

Read more about payroll in ZeniaHR.

Roles this applies to

Frequently asked questions