Wages refer to the monetary compensation employees receive for their work.
How to Calculate Wages?
Most employees will be paid a certain wage in return for their work. To calculate the wage of an employee, their wage rate must be multiplied by the amount of time they worked for the given period. The formula is:
Wage rate × Number of hours worked for the period = Wage of the employee
For example, if an employee is paid $18 per hour and worked 15 hours, their wage will be $270 (18 × 15 = 270).
Employers will have to calculate any taxes or deductions for their employee depending on the regulations in place.
What Are Wage Examples?
If an employee worked 70 hours in the last pay period and they earn $20 an hour, their wages for that period will be $1,400 (20 × 70 = 1,400). That compensation is their gross salary. The employers will have to subtract taxes and deductions from that salary.
If the same employee has worked 70 hours, from which 8 hours were during a public holiday, their employer will have to calculate the appropriate rate for those hours. Typically, employees are entitled to be paid 1.5 times their hourly rate on public holidays. The total gross pay for that employee would be $1,480 ((30 × 8) + (20 × 62) = 1,480).
What Is the Difference Between Wage and Salary?
Wages refer to an hourly rate that employees receive for their work, depending on the amount of hours worked. Salary refers to the compensation an employee receives no matter how many hours they have worked. Wage and salary are both a form of compensation.
Typically, employees who received wages are compensated for their overtime and employees who receive a salary might not be.
How Are Wages Paid?
Wages can be paid at different frequencies, depending on the needs of the employer. For example, wages can be paid:
- Every 2 weeks
What Is the Average Wage in Canada and In the USA?
Average wage varies greatly depending on positions and industries. For example, in Canada:
- The average hourly wage in construction is $33.70;
- The average hourly rate in healthcare is $30.70;
- The average hourly rate in wholesale and retail is $24.70;
- The average hourly rate in accommodation and food service is $18.50.
In the USA, the average hourly wage of the overall population is $28.75.