← HR Metrics·Compensation & Benefits
Grade / Range Overlap
Degree to which an adjacent grade's range shares dollar territory with the one below. Driven by range spread + midpoint differential; design rule: avoid overlapping >3-4 grades.
How it’s computed
(max_g - min_next) / (max_g - min_g) when max_g > min_next, else 0
What the evidence shows
Evidence (effect sizes, priors, validity) is syncing from Principia.
Run it on your data
This metric is computed in the People Analytics Toolbox on your own numbers. See pricing — posted, no quotes.
sources: toolbox:metrics-catalog
What the literature says
The measurement literature behind this signal — sourced, so you can defend it.
“This is a method for establishing salary ranges in which the minimum of each range is set at 80 percent of the midpoint, whereas the maximum is set at 120 percent of the midpoint. The symmetry of this approach is appealing and relatively easy to understand, but it does not…”
— The Compensation Handbook (6th ed.)match 58%
“PAY RANGES AND RANGE SPREADSA “pay range” has a minimum pay value, a maximum pay value, and a midpoint or central value. The difference between the maximum and the minimum is the “range spread,” or the “width” of the range. Range width usually is expressed as a percentage of the…”
— Worldatwork Handbook Compensationmatch 58%
“Ranges should be designed to provide midpoints that reflect the “going rate” and are reasonably close to what the market establishes as the minimum and maximum for the job. Minimums that are too low will result in a company needing to pay an employee higher in the range in order…”
— Worldatwork Handbook Compensationmatch 54%
Resources: The Compensation Handbook (6th ed.) · Worldatwork Handbook Compensation