Explanation:

Compensation is the remuneration awarded to an employee in exchange for their services or individual contributions to your business. The contributions can be their time, knowledge, skills, abilities and commitment to your company or a project. In simpler words, compensation is the money received by an employee from an employer as a salary or wages.
Here’s a list of some of the most common and commonly overlooked types of compensation:

• Base pay (hourly or salary wages)
• Commissions
• Overtime Pay, shift differentials and longevity pay
• Bonus
• Profit Sharing distributions
• Merit Pay or recognition
• Incentive plan or achievement award
• Tip income
• Benefits including Dental, insurance, medical, vacation, leaves, retirement, etc.
• Stock options
• Travel/Meal/Housing Allowance
• Child care and tuition assistance
• Gym memberships and free lunches
• Employee assistance programs that provide counseling, legal advice, and other services.
• Health and wellness benefits
• Other non-cash benefits