Compa-ratio and range penetration are used in the Compensation module to evaluate each employee’s pay based on control values or ranges defined for their job assignment in the Pay Grades tab of Org Setup > Jobs and Job Assignments.
The following is a description of how compa-ratio and range penetration are calculated for both hourly and salaried employees:
- Compa-Ratio: Compa (or comparative) ratio is usually expressed as a percentage and looks at how each employee’s pay compares to either the control salary or control rate defined for their job assignment, depending on the employee’s pay type and pay class.
- Compa-ratio is calculated as follows:
- For full-time salaried employees: Employee Salary ÷ Control Salary
- For part-time salaried employees: Employee Rate ÷ Control Rate
- For full-time hourly employees: Employee Rate ÷ Control Rate
- For part-time hourly employees: Employee Rate ÷ Control Rate
- For example, if the control salary is $50,000 and the employee is paid $40,000, their compa-ratio is 80% because they are being paid 80% of the control salary:
- 40,000 ÷ 50,000 = .80 (80%)
- If the control rate is $48.08 and the employee is paid $64.10, their compa-ratio is 133% because they are being paid at 133% of the control rate.
- 64.10 ÷ 48.08 = 1.33 (133%)
- See "Compa-Ratio Calculation" in the HR Administration Guide.
- Range Penetration: Range penetration is usually expressed as a percentage and looks at each employee’s pay in relation to their job assignment salary range or hourly rate range to determine how far into the range the employee has progressed.
- Range penetration is calculated as follows:
- For salaried employees: (Employee Salary – Range Minimum Salary) ÷ (Range Maximum Salary – Range Minimum Salary)
- For hourly employees: (Employee Rate – Range Minimum Rate) ÷ (Range Maximum Rate – Range Minimum Rate)
- A range penetration of 0% means the employee is paid at the range minimum, a range penetration of 100% means the employee is paid at the range maximum, and a range penetration of 50% means the employee is at the mid-point of the range.
- For example, if the salary range is $40,000 - $60,000 and the employee’s salary is $50,000, then their range penetration is 50% because they are at the mid-point of the salary range:
- ($50,000 - $40,000) ÷ ($60,000 - $40,000) = .50 (50%)
In compensation worksheets, even if a part-time employee and a full-time employee have the same Current Salary value, their Current Compa-Ratio and Range Penetration values will be different because they are based on different annualized hours. When you allocate the same amount to each of these employees, the resulting compa-ratio and range penetration increase will also be different for each employee.
As shown in the following screenshot, an allocation of 5% for each of these employees with the same current salary results in a compa-ratio increase of 10% for the part-time employee and 4% for the full-time employee: