Wage Drift definition

Wage drift has two meanings – the first is the tendency for the average level of monies paid to workers to rise faster than the official wage rates for that industry (often the figure agreed during collective bargaining). This is due to a range of factors including overtime, company bonuses or increased responsibilities.

The second – less-commonly used – definition is the difference between an individual’s basic pay and their total compensation, the latter of which includes financial benefits, including pensions and overtime.