Wage Differential Law and Legal Definition

Wage differential refers to differences in wage rates due to the location of company, hours of work, working conditions, type of product manufactured, or other factors. It may be the difference in wages between workers with different skills working in the same industry or workers with similar skills working in different industries or regions.

For example, wage differentials may also be used to compare wages between genders, union and non-union jobs, or wages of employees with and without college degrees.