A wage, in the hours-based sense, is pay worked out by multiplying the hours an employee worked by an hourly rate. It is how waged employees are paid, as opposed to a fixed monthly salary.
What it means
For a wage earner, pay varies with hours, so the system has to capture hours each period and apply the rate. This base figure is what the National Minimum Wage is tested against, and it is central to the ETI calculation, where the wage relative to the applicable floor decides both eligibility and the incentive amount.
Where it fits in
Wage hours are an earnings component that builds gross remuneration from captured hours and a rate. Overtime is calculated on the same hourly base at a premium. The wage figure feeds the minimum-wage check and the ETI wage-floor test each period.
Key rules
- Pay equal to hours worked times an hourly rate.
- Varies each period with the hours captured.
- Tested against the National Minimum Wage.
- The base for the ETI wage-floor test and for overtime premiums.
