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Fooling Around with Compensation Speak

We normally take compensation very seriously, but perhaps this one day of the year — April Fool’s Day — we can allow for a little levity amidst our sincere pursuit of knowledge.

Let’s start with the serious part. Every profession has its terminology, its “terms of art,” and the practitioners can be identified by their mastery of the vocabulary. Compensation management is no different. Only another comp practitioner will know what you mean when you talk about compa-ratios or ESOPs, or when you expound upon the difference between a fixed commission and a flat commission.

Still, we can all use a little brushing up from time to time. Read on to see our Glossary of Compensation terms … and our lighter-side look at this otherwise very sober topic.

Maybe you’re new to the field, or have taken on responsibility for a new area of comp. Whether rewards management is new to you or you’d just like to review and refresh your knowledge of compensation terminology, check out our free Compensation Glossary. We’ve assembled a list of 135 terms used in the compensation field, including broad-based, executive, and sales compensation terms. It’s not exhaustive—we could easily come up with 1,000 compensation terms—but we tried to cover the basics.

Now, just to keep it light, here’s our not-so-serious-for-once take on a few compensation vocabulary terms.

What do you call a group of musicians who get paid weekly?

Wait for it … a salary band. See where we’re going with this? Here are a few other misappropriations of compensation profession terms:

  1. Artificial intelligence: the antidote to real stupidity
  2. Bottoms-up budget: a budget so big it leads senior management to drink … “bottoms up!”
  3. Top-down budget: a budget that, by the time it gets down to your level, wouldn’t buy a chai latte
  4. Budget pools: the little plastic swimming pools you buy for kids
  5. Channel management: a control process carried out by whomever is holding the TV remote
  6. Compensation transparency: when you look at your pay and it seems there’s nothing there
  7. Compliance: what you do when your kid, or spouse, looks at you with puppy-dog eyes
  8. Deferred compensation: remuneration that will benefit your grandchildren, if you’re lucky
  9. Effective date: an outing with your significant other without the kids along
  10. Expats: those pats on the back that you used to get way back when
  11. Retroactive adjustments: when you wish you could take back those words that just came out of your mouth
  12. Salary band: a group of musicians who get paid weekly
  13. Short term incentives: enticing rewards that don’t last very long

Do you have any compensation daffy definitions to add to our list? Drop us a line at and we’ll save them up for a future blog.

But seriously now, we hope you’ll find our Compensation Glossary useful, and let us know if you have any key additional terms you think we should add. We know there are plenty more!

And if you really want to know how world class compensation management could transform your company, ask to speak with one of beqom’s compensation experts—seriously!


Compensation Glossary

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