Broadbanding Programs

Broad Banding is a type of salary program that replaces multiple grades and ranges with a limited number of wide ranges. Employees move through salary ranges without traditional promotions or job delineation, based on individual skill attainment, and expansion of duties, rather than on any prescribed time pattern.

Design Features:

1. Substantially fewer grade levels and titles.
2. Multiple job levels are combined into a single range.
3. Large range spreads, e.g., 75%, 100% or more vs. 40% to 50%.
4. Provides a method to recognize dual career tracks (management and professional).

Advantages:

• Better accommodates a flat organizational hierarchy.
• Emphasizes skill development rather than vertical promotions.
• Eliminates need to establish artificial job titles and hierarchy.
• Provides greater organizational flexibility since the organization is not encumbered by narrowly focused job titles.
• Simplifies salary administration by eliminating promotions that are not bona fide changes in duties and responsibilities.

Disadvantages:

• May not be compatible with the organization's culture and is less successful in highly structured organizations.
• Loss of control points for salary planning and may result in overpaid employees, requiring greater emphasis on monitoring.
• Difficult to use as management tool for determining relationship between jobs.
• Limits promotional opportunities.

To find out more on how Compensation Resources, Inc. can help your company with Broad Banding, please contact us or call us directly to speak with our compensation consultants at 877-934-0505.