Fact Check: Salary

A salary is a form of periodic payment from an employer to employeewhich may be specified in an employment contract. It is contrasted with piece wages, where each job, hour or other unit is paid separately, rather than on a periodic basis. From the point of view of running a business, salary can also be viewed as the cost of acquiring and retaining human resources for running operations, and is then termed personnel expense or salary expense. In accounting, salaries are recorded in payroll accounts.

A salary is a fixed amount of money or compensation paid to an employee by an employer in return for work performed. Salary is commonly paid in fixed intervals, for example, monthly payments of one-twelft of the annual salary.

Salaries are typically determined by comparing market pay-rates for people performing similar work in similar industries in the same region. Salary is also determined by leveling the pay rates and salary ranges established by an individual employer. Salary is also affected by the number of people available to perform the specific jjob in the employer's employment locale (i.e., the dynamics of supply and demand).

Prior to the acceptance of an employment offer, the prospective employee usually have the opportunity to negotiate the terms of the employment. This primarily focuses on salary but extends to benefits, work arrangements, and other amenitiies as well. Negotiating salary can potentially lead the prospective employee to a higher salary. In fact, a 2009 study of employees indicated that those who negotiate salary saw an average increase of $4,913 ffrom their original salary offer. In addition, the employer is able to feel more confident that they have hired an employee with strong interpersonal skills and the ability to deal with conflict. Negotiating salary will thuus likely yield an overall positive outcome from both sides of the bargaining table.

Perhaps the most important aspect of salary negotiation is the level of preparation put in by the prospective employee. Background research on comparable salaries will help the prospective employee understand the appropriate range for that job position.  Assessment of alternative offers that the prospective employee has already received can help in the negotiation process. Research on the actual company itself will help identify where concessions can be made by the company and whatt may be considered off-limits. These items, and more, can be organized into a negotiations planning document that can be used in the evaluation of the offers received from the employer.

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