On this page

Protect Your Business

Request a Consultation with One of Our Advisers Today!

Three Employees In A Meeting Remuneration

What Does Remuneration Mean?

Remuneration is any type of compensation or pay given to employees. The term refers to pay in the form of a salary, wage or commission, but can also mean non-monetary allowances such as a company car, medical plan, accommodation, or meals.

Fair and competitive remuneration can assist in attracting top quality candidates and make existing staff happier and more productive. Extra allowances like bonuses and holidays can incentivise performance and retain key staff for longer and attract more talented employees.

To ensure staff are compensated fairly, businesses should have a remuneration policy. This policy should outline the guiding principles that decide how the company compensates staff and be clear about current market rates, superannuation, minimum entitlements, and extra benefits.

What’s a Remuneration Package?

Remuneration packages are a mutual agreement between the employer and employee. For this reason, employers are free to structure remuneration packages as they see fit as long as the employee agrees with the terms and the package satisfies the requirements under the National Employment Standards (NES) and any relevant Modern Award or Enterprise Agreement covering your employee.

The remuneration package should be structured accordingly to the employee’s role and responsibilities, standards in the industry, and the current market rate of similar positions.

Below are the most common types of remuneration and their meanings. 

What is the Difference Between Salary and Wage?

A wage is a rate of pay commonly affixed to a period of time such as per hour, or per day. A salary is a fixed regular payment agreed upon in an employment contract however is not affixed to the number of hours performed.


A wage remuneration package must ensure the employee base rate is equal to or greater than the National Minimum Wage and an employee’s applicable Modern Award.

Where a Modern Award applies to wage employee, they will usually be entitled to overtime pay, penalty rates, junior rates, casual loadings, or piece rates.


Commonly the employee may receive an allocation of work to complete and will receive the same fixed regular payment regardless of the hours taken to complete the task. Therefore, the employee will not usually receive additional remuneration benefits such as overtime pay or penalty rates.

It is important to remember a salaried employee is still required to receive all the same entitlements as a wage worker under the NES or relevant Modern Award. This will mean if the employee works excessive hours, the salary package must be of equivalent or greater value than the sum they would have received under the Modern Award.

Before accepting a salary offer, employees can negotiate on remuneration and other policies in their contract. These negotiations can extend beyond the base salary and cover discussions about work arrangements, benefits, and other amenities.

Are You Paying The Correct Amount?

Check you’re paying the correct minimum wage with this free guide today!

How Does Commission Pay Work?

Employees on a commission agreement may be either partially or entirely compensated by commission payments. An employer is usually free to structure commission payments as they wish to incentivise high performance.

Commonly, sales based commission will maintain a strict criteria of a minimum number of sales or value of deals, and once achieved engage a commission payment of a fixed amount or percentage of value.

What Does Paid By Piece Rate Mean?

A piece rate is where an employee gets paid for every piece, item or task completed. For example, this could be the amount of fruit picked or the number of items packed in a certain period of time. Piece rates are typically paid instead of an hourly, daily or weekly wage – but there are exceptions in some industries.

Piecework agreements must be signed in writing. If there is no formal agreement, the employee is not considered a piece worker and must get the national minimum hourly or weekly rate based on their Award type.

An employee can only be paid via piece rates if their Modern Award or Enterprise Agreement allows for this method of payment, or if the employee is Award-free.

Remuneration Bonuses and Incentives

Depending on the business remuneration policy and employment contracts, some employees may receive a bonus. These bonuses can be rewarded to an individual for good performance or the whole team after a particularly successful project, quarter, or year.

Businesses may offer a range of cash and non-cash incentives. These incentives are designed to reward employees who go above and beyond the expectations of their role. Good incentives not only help employees feel valued and motivated – they can boost employee satisfaction and performance over the long-term.

For advice on how to set up a remuneration package for your business and other useful information, fill out the online form below to request a free consultation with Employsure.

Get Workplace Advice Now

Call Our Team of Expert Advisers Who Will Help You with Your Workplace Questions.

Have a question?

Have a question that hasn’t been answered? Fill in the form below and one of our experts will contact you back.

  • This field is for validation purposes and should be left unchanged.

Call Now

1300 207 182

Live Chat

Click here