How is compa-ratio calculated?

Compa-Ratio = Employee Salary / Band Midpoint × 100. A ratio of 100 means the employee is paid exactly at midpoint.

What compa-ratio indicates underpayment?

Below 80–85 is typically considered underpaid relative to the market. Above 120 may indicate compression or inflated pay.

How is compa-ratio used in merit planning?

Employees with lower compa-ratios receive higher merit increases to move toward midpoint. Those above 115 may receive smaller or no increases.

Compa-Ratio Calculator

Calculate compa-ratio — an employee’s salary as a percentage of the salary band midpoint — to assess pay positioning.

Principal ($)

Annual Rate (%)

Years

Compounding / Year

$ Finance Disclaimer: These calculators are for educational and illustrative purposes only. Results do not constitute financial advice. Consult a licensed financial advisor before making investment or borrowing decisions.

How to Use

Enter the values for the scenario you are assessing. Calculate compa-ratio — an employee’s salary as a percentage of the salary band midpoint — to assess pay positioning. Use the compa-ratio result to inform your calculation.

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Frequently Asked Questions

How is compa-ratio calculated?

What compa-ratio indicates underpayment?

How is compa-ratio used in merit planning?