Compa-Ratio & Range Penetration Calculator

Compa-ratio (comparative ratio) measures how an individual employee's pay compares to the midpoint of their salary range. Range penetration shows where pay falls between the minimum and maximum. Together, these metrics are the foundation of compensation administration — used for merit planning, promotion decisions, and pay equity audits.

Calculate Position in Range

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Position in Salary Range

Compa-ratio and range penetration are diagnostic tools, not goals. Appropriate position depends on tenure, performance, and market conditions.

Interpreting Compa-Ratio

Compa-RatioMeaningTypical Action
Below 0.85Significantly below marketImmediate market adjustment
0.85 – 0.95Below midpointPrioritize for merit increase
0.95 – 1.05At marketStandard merit increase
1.05 – 1.15Above midpointModerate merit; promotion readiness
Above 1.15Near or above maxLump-sum bonus; evaluate for promotion

Frequently Asked Questions

What if an employee exceeds the range maximum?

This is called being “red-circled.” Options include freezing base pay until the range catches up, providing lump-sum bonuses, promoting the employee to a higher grade, or restructuring the range.

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