Salary Band and Compa-Ratio Calculator
Build salary bands from a midpoint and range spread, and calculate compa-ratio to see where individual salaries sit within their band.
📊 People Ops📐 Compa-ratio = salary / band midpoint; band width from range spread💼 Business
Band midpoint
Range spread (%)
Employee salary
Proposed increase (%)
Market median for the role
Please enter valid values.
Formula & Reference
| Variable | Symbol | Formula | Units |
|---|---|---|---|
| Salary Band and Compa-Ratio Calculator | — | Compa-ratio = salary / band midpoint; band width from range spread | ratio and currency |
Step-by-Step Examples
Example 1
Mid-Band Employee
Midpoint 92,000, 50% spread, salary 84,000, 6% increase, market 95,000.
- Min = 92,000 / 1.25 = 73,600
- Max = 73,600 × 1.50 = 110,400
- Compa-ratio = 84,000 / 92,000 = 0.913
- Position in range = (84,000 − 73,600) / 36,800 = 28.3%
- After 6%: 89,040, compa-ratio 0.968
✓ Band 73,600–110,400, compa-ratio 0.913
Example 2
Above Band Maximum
Midpoint 70,000, 40% spread, salary 92,000.
- Min = 70,000 / 1.20 = 58,333, max = 81,667
- Salary 92,000 exceeds the maximum
- Red-circled — typically capped or given lump sums instead of increases
✓ Above band maximum — red-circled
Example 3
Below Minimum
Midpoint 60,000, 50% spread, salary 45,000.
- Min = 48,000, max = 72,000
- Salary 45,000 falls below the band minimum
- Requires review — often signals a misgrade or overdue adjustment
✓ Below band minimum
Real-World Applications
Pay Equity
Structured bands make pay decisions defensible and help surface unjustified disparities within the same role level.
Compa-Ratio Analysis
Aggregating compa-ratios across teams reveals whether a group is systematically paid above or below midpoint.
Budget Planning
Bands make merit increase budgets predictable and prevent salary drift beyond intended ranges.
Career Progression
Range position provides a framework for discussing progression within a level versus promotion to the next.
Common Mistakes to Avoid
⚠️
Setting midpoints without market data
Bands built on internal history rather than market benchmarks drift away from competitive reality and cause retention problems.
⚠️
Ignoring red-circled employees
Salaries above band maximum need an explicit approach — typically lump sum awards rather than base increases — or bands lose credibility.
⚠️
Using overly narrow ranges
A tight spread forces promotion as the only route to meaningful increases, which pushes people out when no promotion is available.
Frequently Asked Questions
What is a compa-ratio? ▾
An employee's salary divided by the band midpoint. A ratio of 1.0 means they are paid exactly at midpoint.
How do I calculate band minimum and maximum from a midpoint? ▾
With a range spread, minimum equals midpoint divided by one plus half the spread, and maximum is minimum multiplied by one plus the spread.
What is a typical range spread? ▾
Commonly 30 to 40% for junior roles and 50 to 60% for senior ones, where experience varies more widely within the same level.
What does red-circled mean? ▾
An employee paid above their band maximum. Increases are usually withheld or given as lump sums until the band catches up.
Should compa-ratio be 1.0 for everyone? ▾
No. It should vary with experience and performance within the role — newer people below midpoint, highly experienced above.