Compensation Bands Without the Leak: A 2026 Operating Model
Pay transparency laws are accelerating across the EU, NY, CA, and CO. Bands are a question of when, not if. Here's how to ship them without the morale shock.
What the regulations actually require
Most pay-transparency laws require salary ranges in job postings — they don't (yet) require internal band publication. But once external ranges are public, the internal pressure to formalise is irresistible.
Designing bands that hold up
Three to five levels per role family, 25-30% spread per band, clear progression criteria written before the band is set. The bands fail when 'senior' means six different things across the company.
Rolling out without the morale tax
Communicate first to managers, then to ICs, with a 30-day window for adjustments. Budget for the inevitable outliers — typically 8-12% of staff will be below band and need a one-time correction. Don't try to do it for free; the trust cost is far higher than the cash.