Pay Bands

A Pay band is sometimes used in salaried organizations to define the level of compensation given for certain jobs.

Pay Bands (sometimes also used as a broader term that encompasses several pay levels, ranges or grades) is a part of an organized salary compensation plan, program or system. In an organization that has defined jobs, pay bands are used to distinguish the level of compensation given to certain ranges of jobs. For example, entry level positions at a landscaping company might include truck drivers and laborers. Those jobs and those of similar levels of responsibility might all be included in a named or numbered pay band that prescribed a range of pay, (e.g. Band 1 = $10 - $17 per hour). The next level/classification of a group of similar jobs would include increased responsibility, and thus a higher pay band (e.g. Band 2 = $13 - $21 per hour).

Organizing pay structures in a pay band manner allows for overall control at the management level of an organization, while still giving some discretion for supervisors to reward good performance, and keeping within a reasonable compensation budget structure.

Examples of employers using the pay band method of compensation include:
*the Commonwealth of Virginia, [ [http://www.dhrm.state.va.us/compensation/salarystructure.html Salary Structure Effective 11/25/07 ] ]
*Cornell University in New York, [ [http://www.ohr.cornell.edu/comp/payMinimums.html Office of Human Resources: Compensation: Pay Band Minimums ] ]
*the state of South Carolina [ [http://www.ohr.sc.gov/OHR/employer/OHR-paybands.phtm Office of Human Resources - State of South Carolina Pay Bands ] ] and
*MIT. [ [http://web.mit.edu/hr/compensation/salary_admin.html HR @ MIT - Compensation ] ]

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