How to calculate average daily earnings for vacation pay

In what cases is an employee entitled to an average monthly salary?

The list of situations when payments to an employee are calculated based on the calculation of the average amount of earnings is determined by the Labor Code of the Russian Federation. Among the most common and most often encountered situations in the activities of an ordinary organization that require the calculation of average earnings include:

• payment of vacation pay (Article 114 of the Labor Code of the Russian Federation);
• issuance of compensation for unused vacation - upon dismissal or for part of the vacation over 28 calendar days (Articles 126, 127 of the Labor Code of the Russian Federation);
• employee going on a business trip (Article 167 of the Labor Code of the Russian Federation);
• payment to employees for periods of training while away from work (Articles 173–176, 187 of the Labor Code of the Russian Federation);
• payment of severance pay (Article 178 of the Labor Code of the Russian Federation).

In addition, based on the average monthly salary, the following categories of employees are calculated:

You will need to calculate your average earnings when filling out an unemployment certificate. ConsultantPlus experts told us what formula to use to calculate benefits and how to fill out such a certificate correctly. Get a free trial access to the system and see recommendations.

Why is the average salary needed?

The Labor Code provides for payment “according to the average” in many situations. They can be generally described as deviations from the usual operating procedures. The most common options in which you need to know how to calculate average earnings for a year are the following:

1. Payment of vacation pay or compensation for unused vacation (Articles 114, 126, 127 of the Labor Code of the Russian Federation).
2. Off-the-job training (Article 167 of the Labor Code of the Russian Federation)
3. Being on a business trip (Article 167 of the Labor Code of the Russian Federation).
4. Calculation of the amount of severance pay (Article 178 of the Labor Code of the Russian Federation).

How to calculate average monthly earnings: general procedure

The general and uniform procedure for calculating average earnings for all these cases is enshrined in Art. 139 Labor Code of the Russian Federation. The main rule: in any mode of work, the average salary is calculated based on the earnings actually accrued to the employee and the time actually worked by him for the 12 calendar months that have elapsed before the period in which the calculation of the average monthly salary is required. These 12 months are called the billing period.

The calculation procedure is spelled out in more detail in the regulation “On the specifics of the procedure for calculating the average salary,” which was approved by Decree of the Government of the Russian Federation dated December 24, 2007 No. 922. We will tell you in more detail about how to calculate the average monthly salary. The latest changes to this document were made in 2021, so you need to rely on it when calculating average earnings in 2021.

For information on how to calculate the average number of employees, read the article “How to calculate the average number of employees?” .

Definition of the term

Average monthly salary is an economic indicator that reflects average earnings during one calendar year (that is, twelve months). This indicator is calculated taking into account the amount of money earned by the employee during twelve months and the time he spent at work.

The need to determine this indicator arises when it is necessary to calculate the amount of sickness benefits, vacation pay, etc. In some cases, the employees themselves need a document showing their average monthly salary (for example, to apply for a loan from a bank).

The indicator is actively used by the fiscal service when checking the activities of enterprises. With its help, you can find out what wages the taxpayer pays to its workers. If it is below the regional average or below the subsistence level, an additional check may be carried out.

In this way, the state is trying to fight enterprises that pay their workers wages in envelopes. To avoid problems with the fiscal service and to correctly pay employees, you need to know how to calculate the average salary.

Calculation of average earnings: formula

Calculation of average earnings for certain payments is always done based on average daily earnings.

The general formula for calculating average earnings can be presented as follows:

SmZ = SdZ × N,

Where:

SMZ - average monthly salary;

SDZ - average daily earnings;

N is the number of days to be paid according to average earnings.

For more information on how to calculate average daily earnings in different situations, read the following articles:

• “Average daily earnings for calculating vacation pay”;
• “Calculation of average earnings for a business trip”.

Calculation algorithm

To determine the average monthly salary of an employee, you must first add up all the salaries and bonuses he received over the last twelve months. At the same time, allowances, regional coefficients, bonuses and other remunerations, as well as other types of payments made within the framework of labor legislation, are also taken into account.

After determining the amount, it is necessary to determine the calculation period. The length of each month is determined by the calendar. Periods during which the employee was absent (without earnings), incapacitated or on maternity leave are not taken into account. These periods of time are excluded from the calculations, since payments were already made based on average earnings.

After all the data has been collected, you can start making calculations. They're pretty simple. sufficiently during the billing period is divided by the duration of the period that is taken into account . As already mentioned, it is twelve months.

Here's how to calculate your average monthly salary. An example will help you understand the algorithm better. So, if throughout the entire calendar year the employee was not removed from the workplace due to treatment or other factors, the calculation formula is as follows:

SMZ = Total salary / 12.

Features of calculating average daily earnings

The main feature of calculating average earnings per day is that different rules for its calculation have been established:

• for payment of vacation pay and compensation for unused vacations;

• all other cases.

Calculation of average earnings (except for vacation situations):

SD = salary for the billing period / days actually worked in the billing period.

The billing period is 12 months (Article 139 of the Labor Code of the Russian Federation). If the employee worked for less than 12 months, then the calculation period is equal to the actual period of work.

When paying for vacations, including unused ones, which are provided in calendar days:

SDZ = salary for the billing period / 12 / 29.3.

If some months out of 12 were not fully worked out or there were periods that need to be excluded from the calculation (we will talk about them below), the average daily earnings are calculated as follows:

SDZ = salary / (29.3 × full calendar months + worked, calendar days in incomplete calendar months).

The number of calendar days in incomplete calendar months is determined as follows:

29.3 / number of calendar days in a month × calendar days worked.

Example

Let's say the employee was sick from October 17 to October 31, 2021. Then the number of days in partially worked October: 29.3 / 31 (calendar days of October) × 12 (calendar days worked for the period from October 1 to October 16) = 11 days.

Let’s assume that for 12 months from November 2021 to October 2020, the employee was credited with 494,600 rubles. He worked all the remaining 11 billing months in full. Then the average daily earnings in November is:

494,600 / (29.3 × 11 + 11) = 1,483.95 rubles.

If vacation is provided in working days, the calculation of average earnings for vacation pay is calculated as follows:

SDZ = salary / per number of working days according to the calendar of a 6-day working week.

Average earnings for a business trip

How to calculate the average monthly income for 12 months while on a business trip? First, determine the base for accrual and determine the billing period.

Include similar categories of payments in the database, but exclude material assistance, benefits, compensation for travel, accommodation, recreation, and food. Take into account the amounts that were accrued over the previous 12 months.

Include only the time actually worked in the pay period. Exclude days of illness, other business trips, vacations, downtime and other unworked time from the calculation.

Having determined these indicators, divide the base by the number of days worked. The resulting average daily earnings must be multiplied by the number of days spent on a business trip.

Please note that the duration of a business trip includes days spent on the road (to the place of business and back), days of downtime or delays. For weekends and holidays on which the employee did not work while on a business trip, average earnings are not accrued.

Payments that are taken into account when calculating average earnings

The calculation of average earnings takes into account all payments provided for by the organization’s remuneration system, including:

• wages - time-based, piece-rate, as a percentage of revenue, paid in cash or in kind;
• various incentive bonuses and additional payments, as well as all payments for working conditions - read more about them here;
• bonuses and other similar rewards;
• other payments applied by the employer (clause 2 of regulation No. 922).

At the same time, the calculation of average earnings does not include social payments, such as financial assistance, payment for food, travel, utilities, etc.

How many sick days are paid per year?

Sick leave benefits are paid to all employees who find themselves in a difficult health situation: injury, poisoning, illness. In this case, the entire duration of disability is taken into account. When calculating the number of paid days, all time periods for which sick leave payments are not due are taken into account.

Benefits are accrued to a worker recognized as disabled. And they are paid for four months in a row. If a subordinate is diagnosed with tuberculosis, he is entitled to payments until he fully recovers his health. Until he can return to work obligations. There is a clause in the law according to which sick leave benefits are accrued to an employee for 75 calendar days. But for this, certain conditions must be met:

1. If a person works in an organization under a temporary employment agreement, which specifies a clear term of work. It should not exceed six months.
2. In case of injury to employees before the expiration of the temporary employment contract.

Thus, we can conclude that the number of calendar days for calculating average earnings is not a constant indicator. It depends on the ability to work, health, and vacation time of workers. For any calculations, formulas and a table will help.

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Periods excluded from the calculation period

We have already said that the billing period is 12 calendar months preceding the period in which average earnings are calculated. However, individual periods, as well as the amounts accrued for them, are excluded in the calculation. These are the periods when:

• the employee retained his average earnings (only breaks for feeding the child are not excluded);
• the employee was paid sick leave or maternity benefits;
• the employee did not work due to downtime for which the employer was to blame, or for reasons beyond the control of the employer and employee;
• the employee did not participate in the strike, but did not work because of it;
• the employee was given days off to care for a disabled child;
• in other cases, the employee was released from work with full or partial retention of wages or without it (clause 5 of Regulation No. 922).

General rules

Before calculating the average monthly salary for the year, you need to familiarize yourself with the rules located in the Labor Code and the regulations of the Government of the Russian Federation of 2007. Amendments have been made to the latest version, so you should use the latest version at the moment (dated December 10, 2021). The calculation takes into account:

• salary that was accrued twelve months before the need to calculate SMZ arose;
• time worked in each month during the period described in the previous paragraph.

To calculate the average salary for the year, you need to take the duration of each month, taking into account calendar data. That is, depending on the specific month, this parameter can be thirty or thirty-one days. February is an exception. Depending on the specific year, its duration is twenty-eight or twenty-nine days. The following employee income, summarized for a twelve-month period, is taken into account:

• salary in combination with all allowances. Payments that were made in kind are also taken into account. These include, for example, payment for food;
• bonuses and other rewards;
• other payments related to wages at a particular enterprise.

Amounts and times are deducted from the payroll period when the employee:

• received funds for additional paid leave (if the employee is caring for a disabled child or a person disabled since childhood);
• received payments while on maternity leave or sick leave;
• received payments for the period of release from work while maintaining wages.

In some cases, the twelve-month period preceding the last twelve months of the employee’s work at the enterprise is taken for calculation. Such a need arises if the employee did not work a single day during the specified period or did not receive wages during this time. In addition, the need to “push back” the settlement period arises if the entire twelve-month period consists of time that, by law, must be excluded in the calculations.

If it is impossible to calculate SMZ even for twenty-four months, the days worked in the month when the corresponding calculation is made are taken into account.

Situations when there was no salary in the billing period

If the employee’s salary was not accrued during the billing period, the calculation of average earnings is based on the salary accrued for the previous 12 months. In the case where the employee does not have a salary (time worked) before the start of the billing period, but has one in the month of calculation, the average earnings are determined by the amounts accrued for this month. If there is no salary in the month of calculation, the average salary is calculated based on the assigned tariff rate or salary.

Find out more about unpaid leave in the material “How to take unpaid leave.”

Special rules for accounting for bonuses

When calculating the average monthly salary, different bonuses are taken into account differently, depending on the period for which they were accrued (clause 15 of Regulation No. 922).

When paying monthly bonuses, the calculation includes no more than 1 bonus per month for each bonus indicator, for example, 1 bonus for the number of attracted clients and 1 bonus for sales volume. As a result, no more than 12 bonuses of each type can be taken into account during the billing period.

If bonuses are accrued for a period of more than a month, but less than the calculation period, for example, for a quarter or half a year, they are taken into account in the amount actually accrued for each indicator. And if the duration of the period for which they are accrued exceeds the duration of the billing period - in the amount of the monthly part for each month of the billing period.

Annual bonuses and one-time remuneration for length of service (work experience) are taken into account in full, regardless of the time of their accrual.

In a billing period that is not fully worked, bonuses are taken into account in proportion to the time worked. Bonuses accrued for actual time worked are taken into account in full.

Cases when wages increased

An increase in wages in an organization also affects the average monthly salary of an employee. It is important in what period the salary growth occurs:

• If the increase occurs during the billing period, all payments for the time preceding the increase are indexed. The indexation coefficient is calculated by dividing the new tariff rate, salary, etc. by the tariff rates, salaries that were in effect in each of the 12 billing months.
• If the salary increases after the billing period, but before the occurrence of the event for which the average earnings need to be calculated, the average earnings itself increases. The correction factor here is the ratio of the new wage to the previous one.
• If the increase is carried out already during the period of maintaining average earnings, only part of it increases from the date of the increase until the end of this period. The indexing coefficient is calculated in the same way as in the second case.

See also “Salary indexation in 2021: how, by how much and what is the fine.”

Rules for calculating average earnings for payment of benefits

In conclusion, we would like to draw the reader’s attention to the following. The concept of average earnings is used not only by labor legislation, but also by social security legislation. Thus, sick leave, maternity and child benefits are paid based on average earnings. However, this earnings are considered differently - in the manner established by the law “On compulsory social insurance in case of temporary disability and in connection with maternity” dated December 29, 2006 No. 255-FZ.

Since 2021, all regions have switched to “Direct payments from the Social Insurance Fund”. This means that the first 3 days of sick leave are calculated and paid by the employer, and the subsequent days of sick leave are paid directly by the Social Insurance Fund to the employee.

Our reminder will help you avoid getting confused in the calculations. Go to the material and study this material for free.

Read more about calculating average earnings for social benefits in the following articles on our website:

• for sick leave - here ;
• for child care benefits - here ;
• for maternity payments - here .

If you need to calculate the average daily earnings for payment of severance pay, use the explanations of ConsultantPlus experts. Get trial access and proceed to the calculation example for free.

Main mistakes when calculating payments based on average earnings

Let's look at the most common mistakes made by accountants when making payments based on average earnings.

Mistake #1. Payments until employment.

An employee of JSC “Marshal” Karpov was dismissed on January 16, 2017 due to the liquidation of the enterprise. 03.13.17 Karpov got a new job. For the period of employment, Karpov was paid benefits for the 1st month (01/17/17 – 02/16/17). The benefit was calculated on the basis of average earnings (531 rubles/day), based on the number of working days in the period (01/17/17 – 02/16/17, 23 working days).

Due to the fact that Karpov got a job on 03/13/17, he was not paid any benefits for the 2nd month of employment (02/17/17 – 03/16/17). In this case, the management of Marshal violated labor laws. For the 2nd month from the date of dismissal, Karpov must be paid benefits until employment (02/17/17 – 03/12/17, 15 working days):

531 rub. * 15 days = 7.965 rub.

Mistake #2. Taking into account annual bonuses when calculating average earnings.

An employee of Saturn JSC Kapustin was on a business trip from January 11 to January 13, 2021 (3 days). During this period, Kapustin retains his average earnings. Kapustin’s salary in the billing period (01/01/16 – 12/31/16) amounted to 17,320 rubles/month. 01/09/17 Kapustin was awarded a bonus based on performance results in 2021 - 10,540 rubles. Since the bonus was accrued after the expiration of the billing period, the Saturn accountant did not take this amount into account when calculating average earnings.

The indicator was calculated based on the salary:

RUR 17,320 * 29.3 = 591.1 rub.

For the period of the business trip, Kapustin was accrued the average salary for 3 days:

591.1 rub. * 3 days = 1.773.3 rub.

Despite the fact that Kapustin’s bonus was accrued outside the pay period, it had to be taken into account when determining average earnings. According to the law, annual bonuses are taken into account in the calculation regardless of the date of accrual. The Saturn accountant had to determine Kapustin’s average earnings as follows:

• Income for the billing period:

RUR 17,320 * 12 months + 10.540 rub. = 218.380 rub.

• Average daily earnings

RUR 218,380 / 12 months / 29.3 = 621.1 rub.

During the business trip, Kapustin’s average earnings were:

621.1 rub. * 3 days = 1.863.3 rub.

Mistake #3. Payments to pregnant women.

A pregnant employee of JSC Chemical Plant No. 4, Streltsova, applied for a transfer to a less hazardous job. Streltsova made a statement based on a medical report. Since there is no such vacancy at the enterprise, Streltsova’s transfer was refused.

The management of Chemical Plant No. 4 violated the Labor Code regarding Streltsova’s labor rights. Since the management of the enterprise cannot transfer Streltsova to another position due to the lack of vacancies, the employee had to be removed from harmful work. Until a corresponding vacancy appears, Streltsova must be paid benefits based on average earnings (from the moment of removal from work until the day she returns to work).

Results

The rules for calculating average earnings (average monthly wages), described by us above, apply exclusively to the cases listed at the beginning of the article, including when calculating average earnings when an employee is laid off to pay him severance pay, and social benefits and unemployment benefits do not apply .

You can find out more about social payments in our “Benefits” .

Sources:

• Labor Code of the Russian Federation
• Federal Law of December 29, 2006 No. 255-FZ
• Decree of the Government of the Russian Federation dated December 24, 2007 No. 922

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