Our system's leave encashment formula is based on MOM's guidelines, which you may refer to this link for more information.

[Head to Employees > All Employees > Click edit on selected Employee > Employment's details tab: Current Pay Scheme]

For Monthly payment type of employee, the formula depends on the number of average workdays per month indicated in the employee's pay scheme.

Leave Encashment Formula

(Gross Salary x 12 months) / (Avg no. of workdays x 52 weeks) x No. of leave days left)


The employee works a 5 day work week in the above pay scheme and earns $2,500/month.

In this case, since he works 5 days a week on average and there are 52 weeks in a year, the total number of his working days is 5 days x 52 weeks = 260 days.

To calculate the gross rate of pay per day based on a $2,500/monthly salary,

the yearly pay will be $2,500 x 12months = $30,000

If this employee has 10 days of leave left, the encashment formula would be:
$30,000/260days x 10 days = $1,153.85

Workdays per year

Gross Salary ($) per year

Annual Leave Left

Encashment Formula ($)

260 days



$30,000/260 x 10 days = $1,153.85

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