What is the difference between a wage and a salary?

Answer:
Although a wage and a salary are both forms

of payment for employment, they have some fundamental differences. At the most basic, a salaried worker is paid by the week, month, or year, while a worker earning a wage is paid by the hour. Salaries are usually paid to workers in management, while hourly workers are often in more entry-level positions.

Hourly workers are paid at least minimum wage, and can only work 40 hours a week at their normal rate. Any hours worked after these 40 hours are paid at an overtime rate, usually time and a half. Hourly employees can also be called “non-exempt” employees, referring to the fact that they are not exempt from overtime pay. Although hourly employees often make less than salaried employees, they have a benefit when working many more than 40 hours each week.

Salaried employees earn a certain amount each month or year, and are also known as “exempt” employees. Salaried employees do not make overtime, but earn the same salary no matter how many hours are worked. Often, though not always, salaried employees receive bonuses or other extra compensation.