There are two types of compensation that employees and directors can receive for providing employment services for pay as you earn purposes.
Two Questions:
- Why is it important?
- What are the compensations?
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Compensations:
- Wages
- Salaries
First Compensation: Wages
- Short period
- Low pay based on per hour or quantity of work
- Not consistently employed.
- Not on payroll
- No other work compensation – no allowances, benefits, etc.
- No compensation on leaving
- low levels of education.
- People do not move from their locality.
- No fixed abode.
Second Compensation: Salaries
- Long period
- High pay based on per month
- Consistently employed.
- On the payroll
- Other compensations while working – allowances, benefits, etc.
- Compensation on leaving
- High levels of education.
- People move from their locality.
- No fixed abode.
Above are some of the things to check to clasfy a compensation either are a wage or a salary.
The video
In the video you will learn about the two types of compensations.
