Wage vs Salary and American Wage Laws

Wages are a variable pay scale, almost always variable while salaries are fixes. Most blue collar workers are paid wages while white collar workers are paid salaries. In most states, people that earn wages will get time-and-a-half for working over 40 hours in a week while managers will get nothing extra. Some managers complain because they have to work too many hours with no benefits.

One example below, managers were complaining that they were making less than their subordinates. This did occur once in a while but it began to become a common occurrence when the company began to downsize. Managers were making the same but working more hours. Laborers worked more hours and were paid time-and-a-half for extra hours.

Managers Laborers
Wage * $           25
Salary $       65.000
Hours $             40 $           40
Earned for the month $       5.416 $       4.333
Earned per hour $             31 $           25
Hours $             60 $        60
Earned for the month $       5.416 $       7.583
Earned per hour $             21 $           25

This is sometimes an incentive for companies to overwork managers and send labors home when not needed.

 

Some states require that managers are compensated for working over-time. There is a good and a bad side to labor laws. Too many laws reduce companies and cause unemployment. States where there are no laws have more jobs and employees can pick and choose where they want to work.

Supply and demand can manipulate whether it will be a buyer or a sellers market, the same with human resources. If there is unemployment, the employee cannot be choosy. If there are many jobs, the employer will have to adjust to employee demands to get good employees or they will go to another company.

States with high minimum wage laws have higher unemployment. For example, no one will pay more than $1 for a Big Mac. So states like Washington and New York that have $15/hr minimum wage laws replaced their employees with computers. So they have a few IT techs managing to ensure that the machines work.

Fixing the problem is much more easily said than done.

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