Salary supplement – What is it, definition and concept

The salary supplement is the remuneration paid by a company to the worker with whom it has a contractual relationship. Said disbursement is additional to the base salary.

In other words, a salary supplement is an extra income that a person receives from their employer, and that is not part of the basic remuneration that they receive periodically.

The salary supplement is established for three reasons:

  • Particular circumstances or characteristics of the employee.
  • The nature of the work carried out.
  • Situation and results of the company.

In this article, we will develop these three cases. But first we must point out that salary supplements, although they can be established by collective agreement, this is not a necessary condition.

Another point to take into account is that salary supplements may be stipulated in the law. For example, two annual bonuses can be established, detailing in the regulations how the respective calculation should be carried out.

Salary supplement due to employee circumstances

Salary supplements due to the circumstances of the employee may correspond, for example, to the possession of a professional title or highly specialized knowledge. In the latter case, it could be a worker who has an advanced level in managing a computer system or who is fluent in a foreign language.

Another type of salary supplement of this type is the one received for seniority. In other words, the prolonged permanence of the worker in the company is rewarded.

Salary supplements based on the activity carried out

Salary supplements based on the activity carried out refer, for example, to productivity bonuses. This is done as an incentive to reward good worker performance.

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Likewise, we have supplements for night work and for carrying out high-risk tasks (as in the case of mining).

It should also be noted that a supplement may be agreed for providing a labor service in a specific geographical area. This, provided that the worker establishes his residence in that place. Spanish legislation contemplates, for example, the case of people who must establish themselves for work reasons in island provinces (such as the Canary Islands) or in Ceuta or Melilla.

Complements for the situation or results of the company

The company can also offer salary supplements conditioned to the situation or results of the firm. For example, a share of profits or profits (profit sharing).

Likewise, a participation in the social capital can be offered, that is, in this case, a monetary payment is not made, but shares of the company are delivered.

Types of salary supplement

There are mainly two types of salary supplement:

  • Consolidables: They are those that can be demanded by the worker, even if the circumstances in which they were agreed change. Included in this category are those supplements linked to the particular characteristics of the employee, for example, those that correspond to the recognition of a qualification or special knowledge (as in the aforementioned examples of the foreign language and the computer system).
  • Non-consolidable: They are the ones that can change if certain circumstances change, for example, those supplements that are paid for night work or high-risk work.

Non salary supplements

It is important to differentiate salary supplements, explained in this article, from non-salary ones. The purpose of the latter is to compensate the worker for an expense or requirement that he had to cover with his own resources.

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For example, allowances for a business trip or severance pay are examples of non-salary supplements.

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