Wages

What Are Wages?

The monetary compensation that employees get takes the form of wages. They are paid according to the number of hours worked by the employee.

Employees receive wages in exchange for the services they provide while working. Most firms use a payroll system to divide employee payments into numerous installments throughout the year. Additionally, direct bank transfers or checks can be used to pay wages. Only a small portion of salaries are typically paid in cash in most nations; instead, most wages are paid using vouchers, checks, or electronic transfers.

How Are Wages Calculated?

An employee will be paid a rate for a specific period of time worked, most frequently per hour. To calculate the employee's wage, multiply their hourly rate by the number of hours worked.

In most cases, an employee will be responsible for keeping track of their own hours, recording when they begin and end each workday, as well as any unpaid breaks. Typically, a timesheet or an online time-tracking tool is used to keep track of this. Employee taxes and other payroll deductions must be determined by the employer.

Employers must also figure out any overtime hours that a wage worker puts in. The amount of overtime is determined by multiplying the number of overtime hours worked by 1.5 times the hourly rate.

How Are Wages Disbursed?

Wages can be paid at a number of intervals, but the following are the most typical:

• Weekly (i.e., 52 paychecks a year)
• Bi-weekly (i.e., 26 paychecks a year) 
• Semi-monthly (i.e., 24 paychecks a year) 
• Every month (i.e., 12 paychecks a year)

The most typical payment frequency is biweekly. The week following the week the work was performed, these wages are frequently paid in arrears. This gives the employer enough time to figure out and prepare the owed wages.

What Distinguishes a Salary from Wages?

Despite the fact that wages and salaries have different meanings, people frequently use them interchangeably. The salaries are frequently paid on an hourly, daily, or weekly basis. In contrast, salaries are either paid on a monthly or annual basis.

Regularly, the yearly and monthly payments are referred to as salaries. If Jane makes $20,000 a year, for instance, one may say that she is paid $20,000 annually; nevertheless, saying that Jane is paid $20,000 would be awkward.

Conclusion

The primary responsibility of compensation management under human resource management is wage payment; however, this responsibility does not extend to managing the cafeteria(s) and/or meeting rooms to ensure the smooth operation of the employers' strategic organizational goals. However, it is the primary source of the work that your workers and employees contribute.