Note that the behaviour of this function seems to have changed since extension version 3.6.0 which updated the imagemagick version which this is compiled against from 7.0.7-11 to 7.1.0-13.
Previously, you could do the following:
<?php
$im = new Imagick();
$im->readImage('rose:');
$im->setImageCompression(Imagick::COMPRESSION_LZW);
$im->writeImage('rose_compressed_lzw.tiff');
?>
And you would get a compressed TIFF.
Now, you have to use:
<?php
$im = new Imagick();
$im->readImage('rose:');
$im->setCompression(Imagick::COMPRESSION_LZW);
$im->writeImage('rose_compressed_lzw.tiff');
?>
As such, I'm not 100% sure what the setImageCompression actually does anymore.