Direct Compensation Definition: Direct Monetary Payment

Payroll Definitions

# A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

Direct Compensation Definition

Direct compensation is a type of compensation that involves immediate and direct monetary payment to the employee.

Direct Compensation Extended Definition

Direct compensation is the monetary benefit a business gives its employees in return for their work. This includes an employee’s:

  • Base pay
  • Performance-based variable pay
  • Bonuses
  • Stock options

It may also include certain types of allowances, such as housing, travel, meal, or car allowances.

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Last Updated By

Maria Tanski-Phillips | Mar 02, 2023

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