Financial compensation refers to the act of providing a person with
money or other things of
economic value in exchange for their
goods,
labor, or to provide for the costs of injuries that they have incurred. The aim of financial compensation is the preservation of relationships between those engaged in economic exchange.
Kinds of financial compensation include:
*
Damages, legal term for the financial compensation recoverable by reason of another's breach of duty
*
Nationalization compensation, compensation paid in the event of nationalization of property
*
Payment
*
Remuneration
Remuneration is the pay or other financial compensation provided in exchange for an employee's ''services performed'' (not to be confused with giving (away), or donating, or the act of providing to). Remuneration is one component of reward managem ...
**
Deferred compensation
**
Executive compensation
**
Royalties
**
Salary
**
Wage
**
Employee benefits
*
Workers' compensation, to protect employees who have incurred work-related injuries
Financial compensation is often provided after
service delivery failure in order to regain
customer
In sales, commerce, and economics, a customer (sometimes known as a Client (business), client, buyer, or purchaser) is the recipient of a Good (economics), good, service (economics), service, product (business), product, or an Intellectual prop ...
trust.
An associated response is to offer an
apology that communicates the transgressor feels
remorse.
Financial compensation may be offered as an
incentive
In general, incentives are anything that persuade a person or organization to alter their behavior to produce the desired outcome. The laws of economists and of behavior state that higher incentives amount to greater levels of effort and therefo ...
.
Some offers are too good to refuse. They may become an undue inducement in which they distort people's judgment, contravene their interests and thereby cause
harm
Harm is a morality, moral and law, legal concept with multiple definitions. It generally functions as a synonym for evil or anything that is bad under certain moral systems. Something that causes harm is harmful, and something that does not is har ...
.
Financial compensation may be imposed by a
judge
A judge is a person who wiktionary:preside, presides over court proceedings, either alone or as a part of a judicial panel. In an adversarial system, the judge hears all the witnesses and any other Evidence (law), evidence presented by the barris ...
, before a court, to a victim.
See also
*
Income
Income is the consumption and saving opportunity gained by an entity within a specified timeframe, which is generally expressed in monetary terms. Income is difficult to define conceptually and the definition may be different across fields. F ...
*
Faithless servant
References
Monetary economics
{{finance-stub