Gross Wages

The pay an employee receives before taxes and deductions are withheld is known as gross wages. Because gross wages are calculated before deductions, the actual take-home pay of an employee may be significantly less than their gross wage. Gross wages are calculated differently depending on whether the employee works full-time or part-time, or whether the employee is salaried or hourly.
Employers can calculate gross wages on a quarterly, monthly, weekly, or daily basis—or for any other period of time they desire. Understanding your employee’s gross pay is important because gross wages are necessary for calculating the amount of taxes and deductions that must be withheld—especially if deductions are based on a percentage of the employee’s gross wages.