[rcoc]

Managers are better thought of as "agents of capital or ownership" under this distinction. Manager compensation would typically be at least partially tied to overall company performance, even without equity (e.g. cash bonuses for a strong P+L). Employees, as a group distinct from the Managers, earn a flat wage regardless of performance.

Of course, this is industry/location/company dependent, but I believe that is the reasoning for the distinction.