Employee Compensation and Related Concepts

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What does Employee Compensation refer to?

Back

The remuneration or reward that an employee gets from his employer for services rendered.

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What is Remuneration?

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The salary received by an employee.

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What is Salary?

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Earnings of employees paid on a monthly or annual basis.

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What does Basic Pay refer to?

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The wages or salaries an employee receives in their compensation package.

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What are Wages?

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Earnings received by a worker on a piece rate, hourly rate, or daily rate.

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What is a Piece Rate?

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A system where workers are paid a fixed amount per unit produced.

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What is a Fixed Piece Rate Plan?

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A specific type of piece rate system where the rate per unit is constant, and workers are guaranteed a minimum wage.

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What is a Differential Piecework Plan?

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A system where different rates are paid depending on the worker's performance relative to a standard.

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How are Salesmen typically compensated?

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They are either paid on a straight commission basis or a salary plus commission basis.

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How are Agents and Brokers typically compensated?

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They are generally not employees of the firm and are paid commissions only.