Lesson 7: The Wage

AutorPilar Núñez-Cortés Contreras
Cargo del AutorProfesora Titular de Área. Universidad Loyola Andalucía

Lesson 7: The Wage

1. Introduction

This lesson deals with the concept of wages. Furthermore, differences between wage payments and other benefits are emphasized. Finally the concept of minimum wage is analyzed.

2. The definition of wage

One of the employers' main obligations towards his employees is the payment of wages. Wage is the monetary compensation for the employees' service, paid by the employer. It also compensates the enjoyment of rest periods such as:

· weekly rests

· holidays

· justified absences

· absence because of certain events like wedding, residence removal or death of a family member

Example: ETEA compensates his labour law professors by paying them a wage.

3. Wage and non-wage concepts

The employees' salary can include wage and non-wage payments. A distinction between both concepts is needed. The base salary and also the seniority pay are examples of wage payments. Travel expenses and subsistence allowances can be described as non-wage concepts.

In case of a dismissal the severance charge is calculated by only taking into account the wage payments of the previous year. Besides, social security contribution which is paid by both parts, the employer and the employee, are calculated on wage concepts.

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Example: My last monthly wage included the following components:

· base salary

· seniority

· a commission for leading a student group

· incentives for participating in a research project (wage)

· travel expenses for the use of several means of transportation (compensation for train tickets and taxi payments because of teaching arrangements in Seville)

Nature of payment is inexplicit sometimes. In order to distinguish between wage and non-wage payments, the Spanish legislation has established some specific rules. Accordingly, the following components are non-wage ones:

  1. Compensations

    Compensations are paid by the employer when the employee loses his/her job. Severance payments after a dismissal or a contract suspension are examples of compensations.

  2. Supplied Expenditures

    These are job-related expenses paid by the employee which have to be reimbursed by the employer. As an example, if an employee stays in a hotel for business purposes, he/she pays the bill but has to be compensated by the employer.

  3. Social...

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