National Compensation Survey (NCS)
Inclusions and Exclusions to Compensation Data
Earnings:
The National Compensation Survey defines earnings as “required and expected payments from
the employer to the employee for work performed.”
 “Required” means that the employer is under an obligation to make a payment if the
employee works a certain amount of time, produces a certain output, or makes a certain level
of sales.
 “Expected” means that the employee knows in advance the relationship between input and
payment.
 “Payment” means that the transaction is in the form of cash.
 “Work performed” means that the payment is intended as compensation for time, completion
of a task, or completion of a sale.
Items that meet the NCS definition of earnings include wages, salaries, commissions, and piece
rates. Other types of payments such as hazard pay, cost of living adjustments, and certification
pay that are included in the regular paycheck are also defined as earnings.
Payments in the following categories are excluded from the NCS:
 The payment is not from the employer. Examples include tips and push money.
 The payment is considered token earnings.
 The payment is for on-call or call-in work. These payments technically meet the definitions
of earnings but are excluded due to difficulty of data collection.
Many payments excluded as earnings are included as benefit costs in the National Compensation
Survey. Examples of these payments are discretionary bonuses, safety awards, and cash-in-lieu
of benefits. Overtime and shift differential payments are classified as benefits and excluded from
earnings because they are offered to employees for working additional or less desirable hours.
Benefits:
A benefit must meet these criteria to be included in the National Compensation Survey:
 Benefit is permanent and is a generally accepted labor cost. Benefits that are a one-time
response to external market factors are excluded.
 Benefit data can be collected.
 Benefit cost is borne by the employer.
 Benefit is of interest to NCS data users.
The National Compensation Survey collects data on:
Supplemental pay:
 Overtime
 Shift differentials
 Non-production bonuses
Time based benefits:
 Vacation
 Holidays
 Sick Leave
 Other leave (includes funeral leave, personal leave, etc.)
Retirement benefits:
 Social security
 Medicare
 Defined benefit plans
 Defined contribution plans
Employee welfare benefits:
 Health insurance (including medical, dental, vision, and prescription drugs)
 Short term disability insurance
 Long term disability insurance
 Unemployment insurance (federal, state, supplemental)
 Workers’ compensation
 Life insurance
 Severance pay
Data are collected on certain benefits that do not meet all of the criteria shown above, but are of
interest to data users or are gaining popularity in the labor market. The National Compensation
Survey calls these emerging benefits. Examples of emerging benefits include child care,
educational assistance, and flexible work sites.
The following table shows a variety of types of compensation that are offered to employees.
They are classified according to NCS procedures as earnings, benefits, or excluded.
Earnings, Benefits, or Excluded?
Payment
Earnings
401(k) plan (except for employee's own
contributions)
403(b) plan (except for employee's own
contributions)
457 plan (except for employee's own contributions)
Attendance bonus
Back pay
Call-in pay
X
Certification pay
X
Cost of Living Adjustments (COLA)
X
Commissions
Contract signing bonus
X
Deadheading pay
Draws
Educational allowance
X
Education pay (for achieving certain level)
Fee-based referrals
X
Hazard pay
Hiring bonus
Holiday pay
X
Hourly pay
X
Incentive payments
Insurance payments (health, life, disability)
Jury duty pay (employer payments only)
Benefit
Excluded
X
X
X
X
X
X
X
X
X
X
X
X
X
X
Payment
Legally required payments (State UI, workers'
comp, Social Security, Medicare, F.U.T.A.)
Location pay (extra for Hawaii, Alaska, etc.)
Lodging payments
Longevity pay
Lump sum bonus
Meal allowance
Merchandise discounts
Mileage pay for transportation operatives
Moving allowance
Non-production bonus
On-call pay
Overtime (premium portion only)
Pay for operating certain types of
equipment/vehicles
Payment in lieu of benefits
Payment of employee Social Security and/or
Medicare obligation
Penalty rate payments
Pension contributions
Piece rate pay
Probationary pay
Production bonus
Profit sharing
Push money
Reimbursements
Referral bonus
Retention bonus
Retroactive pay
Room and board
Salary
Section 125 plans
Severance payments
Shift differentials
Sick leave/other leave pay
Skill pay (language ability, etc)
Special job pay (SWAT team, etc.)
Stock options
Subsidized commuting
Supplemental unemployment payments
Tips
Token wages
Tool/equipment allowance
Travel pay
Uniform/clothing allowance
Vacation pay
Wages
Earnings
Benefit
Excluded
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
Examples of compensation:
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Accidental Death & Dismemberment
(AD&D)
Adoption Assistance
Cafeteria plan
Child care assistance
Company vehicle
Credit union
Defined benefits plan
Defined contribution plan
Dental insurance
Employee Assistance Program (EAP)
Elder care
Employee discounts
Employee Stock Ownership Program
(ESOP)
Federal Insurance Contributions Act
(FICA)
Fitness club membership
Flexible benefits plan
Flexible work hours
Free utilities
Free/reduced-rate parking
FSA
Health insurance
Life insurance
Long-term care insurance
Long Term Disability insurance (LTD)
Maternity/Paternity leave
MSA
Non-production bonuses
Off-site child care
On-site child care
Paid holidays
Paid jury duty leave
Paid military duty leave
Paid sick leave
Paid vacation leave
Premium conversion plans
Prescription drug plans
Paid Time Off (PTO)
Relocation assistance
Room and board
Severance pay
Shift differentials
Short Term Disability insurance (STD)
Subsidized commuting
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Supplemental insurance
Supplemental unemployment insurance
Travel accident insurance
Tuition/education assistance
Uniform allowance
Vision care
Wellness program
Work from home/ Telecommuting
Workers Compensation