1 Payment for work done. 2 Payment for injury, loss, or otherwise depriving a person of something he or she is entitled to. See also damages. deferred compensation. 1 Payment at some agreed time in the future for work already done. 2Payment for work done paid in a tax year subsequent to when the payment is earned or paid in a manner, such as contributing to a qualified pension or profit-sharing plan, that postpones the employee's tax liability for the payment. just compensation. The compensat...