Definition: Annual earnings

Category: Labour market

Annual earnings are defined as total gross earnings paid during the reference year including overtime and regular cash supplements as well as vacation payments typically paid to employees. Apart from regularly paid bonuses, all bonuses and payments which are not paid regularly are included (13th or 14th month payments, holiday bonuses, profit sharing, allowances for leave not taken, etc). The following are not be included: payments in kind, severance payments and profitsharing schemes that take the form of dividend distributions.