What Is Remuneration?

What Is Remuneration?

Let me explain remuneration directly: it's the total compensation you receive as an employee for your work, covering base salary, bonuses, commission payments, overtime pay, and any other monetary benefits that come your way.

You should know that perks like an on-site gym or vacation time don't count as remuneration because they aren't direct money paid to you. However, something like using a company car might count and could even be taxable income. And tips? Those count too, even though customers pay them, not your employer.

Key Takeaways

Here's what you need to grasp: remuneration is the full amount you get for doing your job, including salary and all other monetary benefits. A company's contribution to your retirement plan counts as deferred compensation and qualifies as remuneration. It can mix salary, stock shares, bonuses, and other financial perks. Tips are definitely part of it.

Determining Compensation

At the executive level, remuneration might include options, bonuses, expense accounts, and more, all spelled out in your employment contract. The total you get depends on factors like your value to the company—if you have in-demand skills, expect more perks. The job type matters too: some are straight hourly or salaried, others add commissions, bonuses, or tips.

Consider the company's business model; some emphasize generous remuneration with bonuses, stock options, and 401(k) matching. And don't forget the economy—if jobs are plentiful but talent is scarce, companies ramp up benefits to attract you, leading to higher overall remuneration.

Fast Fact

Remember this: if it's remuneration, it's generally taxable. Check the IRS guide on taxation of fringe benefits for the details.

Types of Remuneration

The most common form is wages or salary. In sales, you might get commissions on what you sell or a percentage of sales. Food service and hospitality jobs often rely on tips, especially since their minimum wage is lower than the general state minimum.

Other benefits can include health insurance, retirement matching, sick days, personal days, and reimbursements for travel or expenses.

The Golden Hello

If a company really wants you for your unique skills or reputation, they might offer a golden hello—a signing bonus paid when you start. On the flip side, a golden parachute guarantees executives a big payout if terminated, and it's locked into the contract upfront.

Indirect Remuneration

At the executive level, deferred compensation is another form, where part of your earnings is set aside for later, like employer matches in a retirement plan. Remuneration can also cover benefits you receive, such as health insurance, gym memberships, or company-provided devices or cars.

Minimum Wage Laws

The minimum wage is the lowest legal remuneration employers can pay most workers. It varies by state but must meet or exceed the federal $7.25 per hour. As of January 2025, 21 states raised their minimums, with several at $15 or more, like California and Washington at $16.66 (D.C. at $17.50 if counted). Still, 20 states stick to the federal $7.25.

What Does Remuneration Mean According to the IRS?

According to the IRS, remuneration is the total paid to you as an employee, including salary, hourly rates, bonuses, commissions, or any other payments, plus taxable benefits and allowances.

What Is the Difference Between Salary and Remuneration?

Salary is just one form of remuneration. For many, they're the same—a flat salary or hourly rate. But for others, like salespeople, salary is only part, with commissions adding to the total remuneration.

What Is Another Word for Remuneration?

Compensation is a solid synonym—it covers total payments, where salary or wages might be just one piece.

The Bottom Line

In summary, remuneration is your total earned compensation, like salary, bonuses, commissions, overtime, or other monetary benefits. Federal law sets a minimum hourly wage at $7.25, though many states go higher.