What is Wage drift?
Wage drift refers to a difference between the salary negotiated by a company and the one that is actually paid to an employee by the end of the work period, be it monthly or weekly.
Wage drift definition
Wage drift refers to a difference between the salary negotiated by a company and the one that is actually paid to an employee by the end of the work period, be it monthly or weekly.
Wage drift usually occurs when a company has the unpredicted demand and needs its workers to put in extra work hours. The workers, naturally, receive overtime compensation for this and accumulate a difference over their based negotiated salary over a period of time.
This phenomenon mostly occurs in areas or industries where demand is highly unpredictable on a short-term basis, like tourism or high-growth economies.