Remuneration – GCSE Business Studies

It’s

  • Remuneration – money paid for work (or a service)
  • Payment can be used to motivate workers
  • There are lots of different methods of remuneration
  • It’s reMUNeration, not re-numeration
  • Workers get a payslip that shows their details, national insurance number, gross pay, income tax deductions, national insurance deductions, net pay, payments made so far this year, tax code, the week in the tax year and the reference for the employer

Time-Based

  • Wages are a time-based system: they depend on how much time was worked!
  • Manual, or ‘blue collar’ workers tend to be paid like this
  • If they work for longer than they’re expected to, they get paid at a higher rate – this is known as overtime
  • Wages are calculated and paid weekly
  • Salaries are different from wages: they’re generally paid to non-manual, ‘white collar’ workers
  • They’re calculated annually and paid monthly (usually digitally)

Results-based

  • Piece rate is when workers are paid per item they produce
  • Commission is when sales staff are paid per sale they achieve
  • Alternatively, they could be paid a salary and get a bonus for each sale

Freelance / Temporary

  • Freelance workers are contracted by a business to perform a particular task – they’re not part of the business
  • They submit an invoice to the business when they’re done (just like suppliers do)
  • Temporary workers are different – they’re like normal workers, but they don’t work for the business all the time
  • They work less than normal workers and are paid less
  • They’re hired on a temporary contract
  • They can be used to cover emergencies, like someone being ill / on maternity leave, etc, or peaks in demand for work

Fringe Benefits

  • These are additional rewards paid as well as a wage / salary
  • Fringe benefits are methods of payment that aren’t money
  • Free healthcare, company cars, discounts, pension schemes, therapies, club membership, childcare, holidays, insurance, meals the list goes on
  • They help to improve motivation
  • Fringe benefits can work out cheaper than an increase in wage / salary for both the business and employee, for tax reasons
  • More senior members of a company will get more fringe benefits
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About Matt

I like writing, filmmaking, programming and gaming, and prefer creating media to consuming it. On the topic of consumption, I'm also a big fan of eating.
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