These terms are often used interchangeably, but they mean different things. Understanding the distinction matters for compliance, accounting and HR administration.
The complete process of calculating and paying all employee remuneration — salaries, wages, bonuses, overtime, allowances — plus all related statutory deductions and contributions (PAYE, UIF, SDL).
Used to describe:
Remuneration paid based on hours worked or units produced. Wages vary from week to week or month to month depending on hours or output. Common in construction, hospitality, retail and domestic work.
Used to describe:
| Salary | Wages | |
|---|---|---|
| How it's calculated | Fixed monthly/annual amount | Hours worked × hourly rate |
| Variability | Same every month | Changes based on hours/output |
| Pay frequency | Monthly (usually) | Weekly or bi-weekly (usually) |
| Overtime | Paid on top of salary | Built into hourly rate calculation |
| PAYE applies? | Yes | Yes |
| UIF applies? | Yes | Yes |
| Payslip required? | Yes (BCEA) | Yes (BCEA) |
Yes — both salary and wages are remuneration under the Income Tax Act and the UIF Act. PAYE is calculated on taxable remuneration regardless of whether it's a fixed salary or variable wages. UIF is 1% of gross remuneration (salary or wages) up to the R177.12 monthly ceiling.
A salary is a fixed monthly or annual amount agreed in advance. Wages are paid based on hours worked or output — they vary from period to period. Both are remuneration subject to PAYE and UIF.
Payroll is the process of calculating and paying all employee remuneration. Wages specifically refers to hourly or output-based pay. Wages are one component of payroll.
TSS Payroll supports monthly-salaried and hourly employees on the same payroll run — with automatic PAYE, UIF and SDL calculations.
No credit card required · Cancel anytime · 30-day free trial