Salary Band

## Salary Band

A salary band (also called pay band, pay range, or salary grade) defines the minimum, midpoint, and maximum pay for a particular job level. Organizations use salary bands to ensure internal pay equity and market competitiveness.

### Structure

```
Minimum → Midpoint → Maximum
$80,000 → $100,000 → $120,000 (Band width: 50%)
```

### How Bands Are Set

1. Job evaluation determines the grade/level.
2. Market data (salary surveys) sets the midpoint.
3. The spread (typically 40–60%) defines min and max.
4. Compa-ratio = Employee's Salary ÷ Midpoint × 100.

### Pay Transparency Trend

Laws in Colorado, California, New York, Washington, and the EU's Pay Transparency Directive now require employers to disclose salary ranges in job postings. This has made salary bands visible to external candidates for the first time.

### Band Penetration

Where an employee falls within their band reflects experience and performance:
- Below midpoint: Developing or new to role.
- At midpoint: Fully competent.
- Above midpoint: Expert or high performer.