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Compensation

Compensation

Total financial and non-financial rewards provided to employees for their work.

Full Definition

Compensation encompasses all forms of pay and rewards provided to employees in exchange for their work. Total compensation includes base salary, bonuses, overtime pay, commissions, benefits (health insurance, pension), and non-monetary rewards (flexible working, career development). A competitive compensation strategy is essential for attracting and retaining top talent. HR software helps manage compensation structures, run pay equity analyses, and ensure compliance with minimum wage laws.

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