Key differences between Salary and Wages in Australia
When it comes to calculating how much money you are likely to earn in a job, the first thing to know is how well you will be paid. There are two types of pay structures in Australia:
- Variable wages earned by the hour, paid weekly. This option can be as a full-time employee or casual through an agency or direct employer.
- Fixed salary calculated per year, paid weekly or monthly.
How construction worker salaries and wages work in Victoria
The minimum payment and conditions for workers in each industry or occupation is set out in a legal document called an Award.
“Every award structure here has different levels and pay scales depending on your experience. A site labourer, for example, might be level 1b whereas an excavator operator may be level 8,” says Sean Cathie, General Manager at EWS Recruitment. “This makes a difference in the hourly wage they can earn.”
What is a wage?
Wages are paid weekly, and workers will receive their wages from their employer, which may also be an agency if they are working through one. Employees earning wages are paid per hour, so they can earn more money if they work more hours.
What is a salary?
Employees on a salary work fixed hours and receive a fixed pay. Extra hours worked are not paid. A salary is the fixed sum agreed upon on a yearly basis and is paid in even instalments, weekly or monthly, depending on employer’s policy.
Wages or hourly rate pay system in Australian Construction
Wages are paid to blue collar workers. Typically, they work a 7.6-hour day and a total of 38 hours a week. The weekly wage package is calculated on the number of hours worked. A dangling carrot for casual workers is extra money for working longer hours on site, overtime, and double time. Tea break or smoko is 15 minutes and is generally paid by the employer, whereas lunch break is unpaid. Standard lunch break is 30 minutes.
The benefits of earning hourly wages as a casual
- Casual loading: Every casual worker will get 25 percent on top of their wages in lieu of annual leave and sick leave.
- Travel allowance: This is a contribution towards the cost of getting to and from your work location, depending on the award that you work under.
- Overtime and double time pay.
- Extra allowances: These extras can be a meal allowance or accommodation in regional areas and are pre-agreed before work starts on site.
The advantages and disadvantages of a salary
Employees on a salary receive the same amount of pay consistently, regardless of the number of hours worked. Generally speaking, white collar jobs and office jobs are salary based. While you don’t get the opportunity to earn extra money, there is the benefit of a stable income and permanent job.
Benefits of earning a salary or full-time on wages
- You are entitled to 10 days’ sick leave per year.
- Annual paid leave of four weeks per year is included, and national holidays are paid.
- A salaried employee has the stability of a permanent or fixed-term contract job.
- You know what you’re getting into with fixed office hours times (usually 9am to 5pm) and a fixed salary.
Essential differences between salary/full-time wage and casual wages for Australian workers
- Holiday pay: A salaried employee is entitled to four weeks or twenty days paid holidays each year. A casual wage earner is not entitled to annual leave.
- Sick leave: 10 days sick pay is included in a fixed salary and full-time wage earners. More than one day missed will require a medical certificate.
- Overtime and double time: overtime and double time are paid to wage earners and are an incentive to work more hours, if available.
- Work-life balance: Salary based workers know when they will be ‘off duty’ and can plan ahead for themselves and have a fixed structure. On the other hand, hourly wage workers may choose to work longer hours for extra pay but may face the uncertainty of work only being available.
- Travel Allowance: Workers earning a casual weekly wage can avail of travel allowance to and from work whereas this is not usually an option for salary earners, depending on the award that you work under.
How to make extra money in Victoria
Regional uplift is an extra loading on salaries for jobs in regional or remote areas used to attract quality employees. Living expenses in these areas are generally low, offering the opportunity to save more.
Jumping to different companies is a way to receive more pay, but it may count against you if you are seen to job hop. Sticking with the same employer will build credibility and elevate your career and potential earnings in the longer term.
What determines whether you earn a wage or a salary
How you are paid will largely depend on the type of job you do. Blue collar workers such as labourers, operators, spotters, and trades people are paid on hourly wage. This can mean that you are employed full-time by the employer or work casual and receive the 25% casual loading in lieu of annual leave and sick leave.
How to find work in construction in Melbourne and Victoria
Enjoying our blogs?
Read about preparing your CV here
Are you looking for a job in construction?
Register with us today
"*" indicates required fields