In working life, the terms “wages” and “salary” are often used interchangeably, but there are actually subtle differences behind the two words.
Wages depend on hours worked
Wages are usually performance-related and are calculated on an hourly basis, i.e. the amount depends on the work performed. Workers who are paid hourly receive a predetermined amount for each hour worked. This model is often found in industries where working hours can fluctuate, such as in the service sector or in skilled trades. Overtime is often paid separately, and pay varies depending on the hours actually worked. If, for example, it is a service in the craft sector, the number of units produced can also be used to calculate the wage as an alternative to the working hours, according to DATEV. This is then referred to as piece wages.
Salary is a fixed amount
In contrast to this is the salary, which is usually paid monthly and regardless of the actual working hours. It is a fixed amount that employees receive regularly, regardless of the number of hours worked. This model is typical for employees in positions with regular working hours, such as office workers or managers. Bonuses, bonuses or other additional benefits can supplement the salary, but are usually paid on an annual basis. While wages are only paid after work has been completed, salary can be paid at some point during the month regardless of the hours worked.
Editorial team finanzen.net