Hourly Vs Salaried Employee Payout Types
A salary is a specified amount of money from an employer to an individual, that can be set up in an employment agreement. It’s compared to piece-work wages, where every job, hour or other hourly unit is paid individually, and not on a regular basis. This type of payment structure has become increasingly popular over the years because it allows both sides to benefit, as well as create a working environment that’s more comfortable for all concerned. In a regular salary setting, someone may get a small bonus occasionally for a job well done, but it would not be the same as receiving an increase in salary for doing a good job.
In addition to benefiting the employee with salary increases, employers also take advantage of this system by paying a portion of their employees’ regular income in addition to overtime pay and penalties for late or missed work. This is considered a win-win situation for both parties. Employers get a reliable source of extra revenue every time they hire someone, and the employee gets a fair return for additional earnings. The terms and conditions of this additional income are usually outlined in a standard contract that both parties sign. However, there are some situations where an employee receives overtime pay and penalties for missing work even though they agreed to receive overtime.
The concept of regular salary payments for salaried employees has historically been the norm, but overtime and bonuses have started to give employees more options. Some employers continue to award weekly wages to all employees, regardless of how long they’ve worked for them, as long as they meet minimum requirements. Other employers, however, define “weekend employee” as anyone who is hired for more than eight hours during any one week, and whose salary is above the applicable wage. Full-time salaried employees who work fewer hours are often exempt from overtime and penalties, while part-time employees can only be offered weekly wages.
Bonus-based compensation has also become increasingly common for salaried employees in recent years. These are given on a month-to-month or annual basis, and are only based upon an employees performance. Bonuses are most commonly tied to a company’s stock price, with other bonuses coming from an employees performance in a certain area. However, there are many other variables included when determining a company’s bonus policy.
Many salaried employees prefer a fixed, ongoing income. They like the guarantee that their paycheck will be there each and every month. This is especially true for people who work in industries that have a short turnaround time between paycheck payments. For these types of individuals, a weekly or bi-weekly paycheck is much easier to manage than an hourly employee’s.
As stated above, the law regarding overtime and penalties varies greatly by state. However, most states follow a formula that requires certain amounts of overtime pay and penalties to be applied to the top two salaries. By consulting a local employment attorney (not an employment law specialist) who is experienced in hiring, you can determine which salary requirements will apply to your job title and situation. Keep in mind that these requirements are usually only applied to jobs that are physically located within the state in which you are employed. For example, if you are working at a grocery store in California, overtime pay would not apply to jobs at national retailers.