Wages refers to an early rate of pay and is the pay basis used most frequently for production and maintenance employees (blue color workers). Salary is the money that someone is paid for their job each month, especially when they have professional another non-manual job. It is a fixed amount paid or transferred to the employees at regular intervals for their performance and productivity, at the end of the month. Wages are paid on a daily basis while salary is paid on a monthly basis. Wages are given to the labor class while salary is given to employees.
Goals of salary and wages: There are many goals of salary and wages. These are as follows –
- To meet the needs of the employees, including desires for security and self-esteem.
- To motivate workers to achieve the desired level of performance.
- To be cost-effective or based on what on an organization can afford to pay.
- To be competitive with other organization in order to attract and retain human resources.
- To comply with wages and salary provision in the labor contract with federal and state laws and regulations.
- To be fair and consistently applied throughout the organization.