Compensation means "making up for something." When a restaurant offers you a free dessert as compensation for messing up your dinner order, the hope is that you will leave happy (and refrain from writing a negative review online).

Compensation can also be money, a payment meant to give someone a fair exchange for their effort and output. In fact, the word comes from the Latin word compensat-, meaning "weighed against." If you receive fair compensation for your work, the money is equal to your time and effort. In other words, the scale is balanced.

Definitions of compensation
  1. noun
    the act of compensating for service, loss, or injury
    synonyms: recompense
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    an act of compensation for actual loss or damage or for trouble and annoyance
    type of:
    correction, rectification
    the act of offering an improvement to replace a mistake; setting right
  2. noun
    something (such as money) given or received as payment or reparation (as for a service or loss or injury)
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    excessive compensation
    workmen's compensation
    compensation for death or injury suffered by a worker in the course of his employment
    compensation paid (to someone) for damages or losses or money already spent etc.
    compensation received by virtue of holding an office or having employment (usually in the form of wages or fees)
    blood money
    compensation paid to the family of a murdered person
    amends, damages, indemnification, indemnity, redress, restitution
    a sum of money paid in compensation for loss or injury
    counterbalance, offset
    a compensating equivalent
    (usually plural) compensation exacted from a defeated nation by the victors
    compensation (given or received) for an insult or injury
    (law) redress awarded by a court
    actual damages, compensatory damages, general damages
    (law) compensation for losses that can readily be proven to have occurred and for which the injured party has the right to be compensated
    nominal damages
    (law) a trivial sum (usually $1.00) awarded as recognition that a legal injury was sustained (as for technical violations of a contract)
    exemplary damages, punitive damages, smart money
    (law) compensation in excess of actual damages (a form of punishment awarded in cases of malicious or willful misconduct)
    atonement, expiation, satisfaction
    compensation for a wrong
    a sum granted as reimbursement for expenses
    reimbursement for goods damaged while in transit or in use
    pecuniary reimbursement to the winning party for the expenses of litigation
    type of:
    payment or reward (as for service rendered)
  3. noun
    (psychiatry) a defense mechanism that conceals your undesirable shortcomings by exaggerating desirable behaviors
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    (psychiatry) an attempt to overcome a real or imagined defect or unwanted trait by overly exaggerating its opposite
    type of:
    defence, defence mechanism, defence reaction, defense, defense mechanism, defense reaction
    (psychiatry) an unconscious process that tries to reduce the anxiety associated with instinctive desires
Word Family

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