Salary Scale Template for Excel and Google Sheets

A salary framework is the architecture behind an organization’s compensation strategy. It defines how roles are evaluated, how salary data is gathered and applied, and how salary bands or grades are assigned.

Key components include:

• Pay structures (e.g., bands or ranges and job levels)
• Internal equity guidelines (ensuring employees in similar roles are paid fairly)
• Use of market data to remain competitive
• Guidance for pay decisions and progression

This framework ensures equitable pay and compliance with emerging pay transparency laws for organizations scaling globally.

A pay level refers to the relative compensation assigned to a job based on its complexity, impact, and market value. In contrast, a pay structure organizes all pay levels into coherent groupings, such as salary bands or ranges.

These structures guide compensation decisions, ensuring internal equity and alignment with market data while allowing room to create salary bands that grow with the business.

A pay hierarchy is the ordered ranking of roles by value or level, which informs their salary bands. It supports a logical salary structure—from entry-level to executive—ensuring clarity on how pay decisions are made.

For SMBs with lean HR teams, a clear pay hierarchy simplifies performance management and helps align expectations with career paths.

A traditional salary structure typically consists of fixed pay levels and defined salary grades with clear minimum, midpoint, and maximums. For instance:

• Grade 1: Administrative Assistants – $35,000 (min) to $50,000 (max)
• Grade 2: HR Coordinators – $50,001 to $65,000
• Grade 3: HR Managers – $65,001 to $85,000

This model gives organizations a compensation starting point for making consistent compensation decisions, especially in companies prioritizing predictability. However, it often lacks the agility to match market rates and can be rigid in attracting and retaining top talent, especially in competitive or remote markets.

An appropriate salary range should reflect:

1. The minimum and maximum thresholds for a role
2. A clear midpoint that represents the fair market value
3. Inputs from reliable market data (e.g., Radford, Mercer, Deel benchmarks)
4. Consideration for internal equity to ensure fairness across employees in similar roles

This range helps establish salary bands that are flexible enough for negotiation while providing structure for pay decisions. It also supports attracting and retaining top talent by signaling a commitment to fair and competitive pay.

Though more dynamic than pay grades, salary bands have potential drawbacks:

1. Too wide a band may cause uncertainty around where an employee falls
2. Without clear starting points, pay decisions can become inconsistent
3. Managers may struggle to justify comp increases without robust salary data
4. Regular upkeep is required to stay compliant with pay transparency laws and market data

If not clearly communicated, bands can backfire by confusing rather than empowering employees.

While a set pay scale ensures consistency, it comes with risks:

• Can quickly fall behind market rates
• Lacks the flexibility to reward top performers or high-demand talent
• Limits responsiveness to geographic cost differences or remote roles
• May create stagnation when minimum and maximum thresholds are hit prematurely

Over time, these issues can undermine internal equity and hamper efforts in attracting and retaining top talent.

A fair pay system delivers equitable pay by balancing market rates, individual performance, and internal equity. It includes:

• Clear salary bands and pay structures
• Defined rules for promotions and increases
• Documentation to support consistent compensation decisions

To be fair, it must also address pay transparency laws and communicate how salary data informs band creation. Fair systems reinforce trust, especially in companies aiming to scale across borders.