School Payroll and Staff Leave: A Practical Guide for Indian Schools

School payroll is the monthly job of working out each staff member's salary, deductions and net pay, and paying it on time. In most schools it collides with leave records, attendance registers and a spreadsheet that only one person understands. This guide covers how salary is usually structured in Indian schools, the deductions to get right, how leave feeds into pay, and a month-end checklist.

How a salary is usually structured

• Basic pay: the fixed core of the salary. Many deductions are worked out on it.
• Dearness allowance (DA): common in aided and government-pattern schools.
• Other allowances: house rent, transport, special or subject allowances.
• Deductions: provident fund, ESI, professional tax, income tax (TDS), loan repayments.

Write the structure down for each role or grade as a template, so new staff are set up the same way and a revision is one change, not fifty.

The deductions to get right

• Provident fund (PF): usually worked out on basic pay plus DA, with the statutory wage ceiling of ₹15,000 often used as the base. Check which staff are covered and what rate applies to you.
• ESI: applies to employees whose gross pay is within the ESI wage limit (currently ₹21,000 a month), where the school is covered by the scheme.
• Professional tax: a state tax with its own slabs; some states do not levy it at all. The yearly amount cannot exceed ₹2,500.
• TDS: income tax deducted each month based on the employee's expected yearly income and chosen tax regime.

Rates and limits change, and rules differ by state and by type of school. Confirm the current figures with your accountant or tax adviser before relying on them.

Leave and attendance: where pay goes wrong

1. Define your leave types: casual, sick, earned, and unpaid (loss of pay). Say how many days each allows a year and whether unused days carry forward.
2. Apply and approve in writing, before the leave where possible, so the record exists when payroll runs.
3. Count payable days, not calendar days. Payable days are days present plus approved paid leave. Absences without leave and unpaid leave reduce pay.
4. Close attendance before you run payroll. A day corrected after salaries are paid means an adjustment next month.

A month-end payroll checklist

1. Close the month's staff attendance and approve pending leave.
2. Add joiners, leavers and any salary revisions.
3. Add one-off items: bonus, arrears, loan instalments, recoveries.
4. Generate payslips and check a sample against last month: any big change should have a reason.
5. Get the total approved by whoever signs off salaries.
6. Pay, mark each salary as paid, and share payslips with staff.
7. Deposit PF, ESI, professional tax and TDS by their due dates.

How Eduzon handles payroll and leave

In Eduzon each staff member has a salary structure of basic pay, earnings and deductions, and the school can save salary templates to set staff up quickly. Each month the school previews and then generates payslips for all staff in one step, and can recalculate after a correction. Pay is based on payable days: days present plus approved paid leave on working days, so absences and unpaid leave reduce pay automatically. Provident fund and ESI are worked out from the rate set for each staff member, professional tax uses built-in slabs for several states (or a fixed amount elsewhere), and TDS is entered as a monthly amount. Staff loans are recovered automatically in monthly instalments. Each payslip can be downloaded as a PDF, and staff can see their own payslips when they sign in.

For leave, the school sets up leave types with yearly quotas, paid or unpaid, and carry-forward limits. Staff apply from the staff app or the web, and a person with approval rights approves or rejects it. Staff attendance can be marked by the office, punched from the staff app within a set distance of the school, by QR code, or pulled from supported biometric devices.

Frequently asked questions

How is salary calculated for days of leave?

Approved paid leave is counted as a working day. Unpaid leave and unapproved absence are not, so pay is reduced in proportion to the payable days in the month.

Is PF compulsory for school teachers?

It depends on whether the school is covered under the EPF Act and on the employee's wages. Many private schools are covered. Check your school's registration and the current rules with your accountant.

What should a staff payslip show?

The month, payable days, each earning, each deduction (PF, ESI, professional tax, TDS, loan instalments), gross pay and net pay.

How can a school reduce payroll errors?

Use salary templates, close attendance and approve leave before running payroll, compare each month's totals with the previous month, and keep one system for attendance, leave and salary instead of separate spreadsheets.