Wages And Salaries

Whats the difference?

 Contents
To answer the question
Whats the difference the
answer is simple
Wages are paid weekly, Piece Rates
often in cash
Salaries are paid Time Rates
fortnightly or monthly,
usually directly into an
Overtime
employees bank account.
 Piece Rates
In this method of payment you are paid
for the number of pieces or units of
work you complete or sell.

If you are shearing sheep, you will get

paid according to how many sheep
you shear, or if picking cherries, you
will get paid according to how many
kilograms you pick.
Piece Rates
ADVANTAGES:

The faster you work, the

more money you can
earn
You can pace yourself to
earn what you wish and
not have to work flat out
all day
You are paid according
to your ability to do the
jobs, as the rewards are
better for faster, more
efficient workers
 Piece Rates Back

DISADVANTAGES:

Speed to complete more

work can lead to shoddy,
poor quality work.
Rates of pay can be set
too low, so the work is
regarded as slave labour
and workers are seen to
be exploited
Pay-based employment
often ignores other factors
which motivate people,
such as helping people, as
in the case of nursing

End
 Scenario
You might work for a local gardening
company planting trees and get paid
$2.00 for each tree you plant. If you
planted 12 trees you would earn
$24.00
 Time Rates

In this method you

are paid for each
period of time you
are at work,
usually for each
hour.
Time Rates
ADVANTAGES:

You are paid for the hours

you are at work even
though you might not be
working all the time
Everyone receives the
same rate for the same
job
Overtime rates can be
calculated to compensate
for the loss of your leisure
time if you have to work
longer hours
 Time Rates Back

DISADVANTAGES:

Your employer has to pay

you regardless of the
output you produce
Those able to produce
more may be less
motivated to do so as they
get paid the same rate as
those who produce less
There is little financial
incentive to work hard

End
 Scenario
If you took six hours to plant the 12
trees and you were paid $4.00 per
hour, you would earn $24.00
Overtime
As the name implies,
overtime is paid to an
employee when they
work extra hours, or
over the time, for
which they would
normally expect to be
paid. It is usually
calculated as an
additional fraction
added to the basic
hourly rate.
 Overtime
ADVANTAGES:

Employees are rewarded

for working over and
above their normal
working week
It can act as an incentive
to those employees who
wish to, or may have to
work longer hours
Regular overtime can
increase an employees
weekly earnings and so
improve his or her
disposable income and
standard of living
 Overtime Back

DISADVANTAGES:

Some employees may work

slowly during the day to
create work which has to be
completed in overtime
It increases the firms wages
bill and the payment of labour
is often one of the highest
costs in a business
Some employees may not be
willing to work overtime,
even though they are offered
extra money for doing so,
which may make it difficult
for a business to provide the
required number of staff or
meet production deadlines.

End
 Scenario
If an employees usual rate of pay is
$5.00 per hour, if they are being
paid overtime at time and a half,
they would receive $5.00 plus a half
of $5.00 ($2.50),
ie $5.00 + $2.50 = $7.50 per hour for
each extra hour worked.
Wages and Salaries

Now you know the difference