Postcompensation

Postcompensation refers to the provision of compensation after an event or assessment, typically to correct imbalances, reward performance retroactively, or adjust for information that emerged after the fact. The term appears in several fields, each with specific practices but sharing a common principle: compensation is determined post hoc rather than at the initial decision moment.

In economics and finance, postcompensation covers retroactive settlements and adjustments that become payable after a determination, agreement, or audit. Examples include retroactive subsidies, refunds, or cash settlements that address earlier discrepancies between promised and delivered benefits or costs.

In human resources and labor relations, postcompensation describes pay and benefits issued after a review period. This includes retroactive salary increases following a market-rate survey or performance assessment, delayed bonuses, and adjustments to align pay with updated compensation bands. Policies typically define eligibility, timing, and funding constraints to manage budget impact and equity.

In engineering and communications, postcompensation denotes corrective measures applied after a signal or system has operated, to compensate for distortions, losses, or nonidealities introduced by the channel or process. This can involve post-processing filters, equalization, or calibration steps that improve accuracy or quality.

Benefits and risks: Postcompensation can improve fairness and accuracy but may introduce planning complexity, budgetary strain, and perceptions of inequity if not transparently administered. Organizations often pair postcompensation with clear criteria, documentation, and regular auditing.

See also: precompensation, retroactive pay, retroactivity.