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compa-ratio
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The ratio of fixed pay rate to the grade midpoint (or control point) in graded compensation plans. The ratio is used as a measure of how well an employee is paid relative to the grade structure. The ratio is calculated by dividing the fixed pay rate by the midpoint; for example, an employee with a compa-ratio of less than 1.0 is paid less than the range midpoint. Compensation plans are typically designed so that the average fixed pay rate of all employees at a given grade equals the midpoint of the range.
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en
The ratio of fixed pay rate to the grade midpoint (or control point) in graded compensation plans. The ratio is used as a measure of how well an employee is paid relative to the grade structure. The ratio is calculated by dividing the fixed pay rate by the midpoint; for example, an employee with a compa-ratio of less than 1.0 is paid less than the range midpoint. Compensation plans are typically designed so that the average fixed pay rate of all employees at a given grade equals the midpoint of the range.
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