Calculate the position of an employee's salary relative to the market midpoint.
What is a Compa-Ratio?
The Comparative Ratio (Compa-Ratio) is a common human resources metric used to determine how an employee's pay compares to the market average or the midpoint of their assigned salary range. It is an essential tool for ensuring internal equity and external competitiveness.
The Compa-Ratio Formula
Calculating the compa-ratio is straightforward. The formula is:
Compa-Ratio = (Actual Salary / Range Midpoint) × 100
Understanding the Results
Once you have calculated the percentage, here is how most HR professionals interpret the numbers:
Compa-Ratio Range
Interpretation
80% – 89%
New to the role, learning phase, or under-market pay.
90% – 109%
Market-competitive. Fully competent in the role.
110% – 120%
Highly experienced, top performer, or long tenure.
Above 120%
Often requires promotion or range adjustment; may be "red-circled."
Real-World Example
Imagine an Analyst with an annual salary of $68,000. The market midpoint for an Analyst position at that company is $80,000.
Calculation: (68,000 / 80,000) = 0.85
Percentage: 0.85 × 100 = 85%
This result suggests the employee is currently paid at 85% of the market rate, which might be appropriate for a junior employee but may signal a need for a salary increase if they are high-performing.
function calculateCompaRatio() {
var salary = document.getElementById("actualSalary").value;
var midpoint = document.getElementById("midpointSalary").value;
var resultBox = document.getElementById("resultBox");
var ratioOutput = document.getElementById("ratioOutput");
var interpretationOutput = document.getElementById("interpretationOutput");
if (salary === "" || midpoint === "" || midpoint <= 0) {
alert("Please enter valid positive numbers for both fields.");
return;
}
var ratio = (parseFloat(salary) / parseFloat(midpoint)) * 100;
var roundedRatio = ratio.toFixed(2);
resultBox.style.display = "block";
ratioOutput.innerHTML = "Compa-Ratio: " + roundedRatio + "%";
var interpretation = "";
if (ratio < 80) {
interpretation = "Interpretation: This salary is significantly below market (Under 80%). This usually applies to new hires in training or indicates a potential retention risk.";
resultBox.style.borderLeftColor = "#e74c3c";
} else if (ratio >= 80 && ratio < 90) {
interpretation = "Interpretation: This salary is in the lower quartile (80-90%). Common for employees who are still developing their skills or are relatively new to the grade.";
resultBox.style.borderLeftColor = "#f1c40f";
} else if (ratio >= 90 && ratio <= 110) {
interpretation = "Interpretation: This salary is market-competitive (90-110%). This is the target range for fully proficient employees meeting all performance expectations.";
resultBox.style.borderLeftColor = "#2ecc71";
} else if (ratio > 110 && ratio <= 120) {
interpretation = "Interpretation: This salary is in the upper quartile (110-120%). This usually reflects a high level of experience, consistently superior performance, or long tenure.";
resultBox.style.borderLeftColor = "#3498db";
} else {
interpretation = "Interpretation: This salary is above the typical range maximum (Over 120%). This employee may be overqualified for the current role or ready for a promotion.";
resultBox.style.borderLeftColor = "#9b59b6";
}
interpretationOutput.innerHTML = interpretation;
}