Term of the Day competence 1. A cluster of related abilities, commitments, knowledge, and skills that enable a person (or an organization) to act effectively in a job or situation. Competence indicates sufficiency of knowledge and skills that enable someone to act in a wide variety of situations. Because each level of responsibility has its ownrequirements, competence can occur in any period of a person's life or at anystage of his or her career. 2. Law: The capacity of a person to understand a situation and to actreasonably. Disputes regarding the competence of an individual are settled by ajudge and not by a professional (such as a doctor or a psychiatrist) although the judge may seek expert opinion before delivering at a judgment. Also called legal capacity. Learn more about this term Usage Example After months of training at my new job I gained the competence to complete all of my tasks on my own.