Actually, I think there are three categories, not two.
If you pay someone to get a job done, that's a contractor.
If you pay someone for their hours worked, that's an hourly-waged employee.
If you pay someone a salary, you're paying them to spend their working time, which will typically be around 35-40 hours a week but is not strictly defined or measured, attending to your business needs in whatever ways are agreed between you. It's a quite different relationship, based on a different level of expectations and trust.
To give a specific example: I'm a (European-based) salaried employee of a (US-based) company. Most weeks I spend rather more than 40 hours, one way or another, working on things for my employer, as I (mostly) enjoy my work and want to make the best contribution I can. Sometimes personal stuff comes up, and I may end up spending significantly less, but no-one's keeping track at that level on a day-to-day basis. I don't expect extra money if I work into the evening to finish something I'm involved in, nor do I expect to lose money if I spend the afternoon taking care of a family emergency.
I have in the past had a time-card that I punched when arriving at work, and again when leaving, and my employer paid me for the hours I worked; no more, no less. I'd call that "wages". My current employer pays me an agreed annual sum; it does not depend on the total number of hours I work during the year, but it comes with an expectation of how I will spend my time and expertise. That's a "salary".
If you pay someone to get a job done, that's a contractor.
If you pay someone for their hours worked, that's an hourly-waged employee.
If you pay someone a salary, you're paying them to spend their working time, which will typically be around 35-40 hours a week but is not strictly defined or measured, attending to your business needs in whatever ways are agreed between you. It's a quite different relationship, based on a different level of expectations and trust.
To give a specific example: I'm a (European-based) salaried employee of a (US-based) company. Most weeks I spend rather more than 40 hours, one way or another, working on things for my employer, as I (mostly) enjoy my work and want to make the best contribution I can. Sometimes personal stuff comes up, and I may end up spending significantly less, but no-one's keeping track at that level on a day-to-day basis. I don't expect extra money if I work into the evening to finish something I'm involved in, nor do I expect to lose money if I spend the afternoon taking care of a family emergency.
I have in the past had a time-card that I punched when arriving at work, and again when leaving, and my employer paid me for the hours I worked; no more, no less. I'd call that "wages". My current employer pays me an agreed annual sum; it does not depend on the total number of hours I work during the year, but it comes with an expectation of how I will spend my time and expertise. That's a "salary".