How to set compensation bands on Starch
Compensation bands are the salary ranges you set for each role — a floor, a midpoint, and a ceiling that tells you what a job is worth and gives you a defensible answer when candidates negotiate or when existing employees ask why they're paid what they're paid. Most operators put this off until they're about to make a hire, then scramble to justify a number that was mostly gut instinct. The longer you wait, the harder it gets: you end up with pay that's inconsistent across the team, compression between new hires and tenured employees, and no framework to explain any of it.
What this looks like in practice depends on your size, your industry, and whether you're benchmarking against market data, internal equity, or both — which is why the details vary a lot depending on your situation.
On Starch, the end result is a compensation framework your whole team can actually use: a structured document in your Knowledge Management app where each role has a defined band, the data sources behind it are cited, and the policy for how you move people through the range is written down and searchable. If you're sharing it with a board or a new hire, the Presentation Agent (currently in development) can turn it into a clean deck in minutes. The framework lives in one place, doesn't go stale, and stops being something that only exists in your head.
Why it matters
Without defined bands, every offer becomes a negotiation you're unprepared for — and you risk paying new hires more than existing employees doing the same job, which creates retention problems you won't see coming until someone quits. Defined bands also matter for fundraising: investors and acquirers will ask whether your comp structure is defensible. Getting it right early means fewer awkward conversations, fewer regrettable departures, and a hiring process that moves faster because you already know the range.
Common pitfalls
The most common mistakes: anchoring bands to what you paid the last person in the role rather than what the market pays now; setting ranges so narrow that there's no room to differentiate performance; building the framework in a one-off spreadsheet that nobody updates after the first hire; and skipping the written policy for how and when employees move through the band, which means the bands exist on paper but managers still negotiate around them case by case.
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