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Salary vs. Wage: What's the Difference?

Edited by Janet White || By Harlon Moss || Published on November 19, 2023
A salary is a fixed annual compensation regardless of hours worked; a wage is payment based on hours worked or tasks completed.

Key Differences

A salary refers to a predetermined amount of compensation that an employee receives, typically annually, regardless of the actual hours they work. Those who earn a salary often have roles that are not strictly tied to specific hours, and they might be expected to complete tasks outside of the conventional 9-to-5 workday. As a result, salaried employees may not receive overtime pay since their compensation isn't calculated hourly.
On the other hand, a wage is a compensation based on the actual time an employee works or sometimes on the tasks they complete. This is most common for hourly positions, where an individual earns a specified amount for each hour worked. Those who earn wages might be more closely tied to specific shifts or hours, and they often receive overtime pay when working more than the standard number of hours in a workweek.
While both salary and wage serve as compensation for work, their structures and implications differ. For example, salaried employees might have more predictable income, as their earnings don't fluctuate based on hours worked. Wage earners, meanwhile, might see more variation in their paychecks, depending on their work hours in a given period.
Another distinction is in the benefits and protections offered. Salaried positions might come with additional perks such as health insurance, retirement contributions, and paid time off. Wage positions, while sometimes including these benefits, may not always have them. However, wage earners often have clearer legal protections concerning overtime and minimum wage regulations.

Comparison Chart

Payment Basis

Fixed amount (often annual)
Hours worked or tasks completed


Typically doesn't receive overtime pay
Often receives overtime pay

Income Predictability

More consistent income
Income can vary by hours worked


Often includes various benefits
Might or might not have benefits

Legal Protections

Might not have clear overtime rights
Protected by minimum wage laws

Salary and Wage Definitions


A predetermined earnings not dependent on actual hours worked.
Despite working long hours, his salary remains the same.


Earnings that fluctuate based on hours.
If she works overtime, her weekly wage increases.


Fixed compensation paid regularly for services.
Her annual salary for the managerial position is $80,000.


Remuneration based on time worked or tasks completed.
His wage depends on the number of items he assembles.


A set amount of money earned by an employee annually or monthly.
His monthly salary is $6,000 before taxes.


An hourly pay rate for services rendered.
As a cashier, he earns a wage of $12 per hour.


Remuneration not based on hours worked.
She prefers a salary position to ensure consistent income.


Payment for labor or services paid at an hourly rate.
The minimum wage in her state is $15 an hour.


Regular payment for professional or office work.
Doctors often have a higher salary due to their specialized skills.


Compensation often tied to manual or non-salaried jobs.
Factory workers typically earn a wage.


Fixed compensation for services, paid to a person on a regular basis.


A regular payment, usually on an hourly, daily, or weekly basis, made by an employer to an employee, especially for manual or unskilled work.


A fixed amount of money paid to a worker, usually calculated on a monthly or annual basis, not hourly, as wages. Implies a degree of professionalism and/or autonomy.


Wages The price of labor in an economy.


To pay on the basis of a period of a week or longer, especially to convert from another form of compensation.


What's a key difference between salary and wage?

Salary is a fixed amount regardless of hours, while wage is based on hours worked or tasks.

Is wage always hourly?

Primarily, yes, but it can sometimes be based on tasks completed.

Are salaried employees exempt from minimum wage laws?

Some salaried employees, due to their pay and role, are exempt from specific minimum wage laws.

Do wage earners always get paid weekly?

Not always. Wage earners can be paid weekly, bi-weekly, or even monthly.

Do all wage jobs pay the same rate?

No, wage rates vary based on the job, industry, and location.

Do wage earners have fixed work hours?

Often, wage earners have set shifts, but hours can vary, especially in part-time or flexible jobs.

Which is more predictable: salary or wage?

Salary usually offers more consistent income as it's a fixed amount.

Are commission jobs salary or wage-based?

Commission jobs can be either, but they primarily depend on sales or results rather than time.

Is salary better than wage?

Neither is inherently better; it depends on individual preferences, job roles, and career goals.

Do salaried employees receive overtime pay?

Typically, salaried employees don't receive overtime pay, though exceptions exist.

Can wage earners receive a salary?

While unusual, an employee can have a mix of both in hybrid compensation models.

Can wage earners receive bonuses?

Yes, wage earners can also receive bonuses based on performance or company profitability.

Do salaried positions have more job security?

Not necessarily. Job security depends on the industry, company stability, and individual performance.

Are contractors typically paid a salary or wage?

Contractors can be paid either way, but they often have agreed rates for specific tasks or projects.

Is minimum wage related to salary or wage?

Minimum wage refers to the lowest hourly wage legally payable to employees.

Can a salaried position be part-time?

Yes, a salaried position can be part-time, but it's less common.

Do salaried employees have more job benefits?

Often, but not always. It depends on the position and employer.

Are bonuses part of a salary?

Bonuses are separate from salary but can be an addition to an employee's compensation.

Is salary always annual?

While often quoted annually, salary can be paid monthly, bi-weekly, or even weekly.

Can an employer switch an employee from wage to salary?

Yes, but changes should align with employment contracts and labor laws.
About Author
Written by
Harlon Moss
Harlon is a seasoned quality moderator and accomplished content writer for Difference Wiki. An alumnus of the prestigious University of California, he earned his degree in Computer Science. Leveraging his academic background, Harlon brings a meticulous and informed perspective to his work, ensuring content accuracy and excellence.
Edited by
Janet White
Janet White has been an esteemed writer and blogger for Difference Wiki. Holding a Master's degree in Science and Medical Journalism from the prestigious Boston University, she has consistently demonstrated her expertise and passion for her field. When she's not immersed in her work, Janet relishes her time exercising, delving into a good book, and cherishing moments with friends and family.

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