Compa-Ratio Calculator
The compa-ratio compares an employee's pay to the midpoint of their pay range. A ratio of 1.0 means they are paid exactly at the market reference point; below 1.0 is below midpoint, above 1.0 is above it.
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About Compa-Ratio
Compa-ratio measures how competitive a salary is versus a target position in the grade or against market percentiles (such as the 25th, 50th and 75th).
A compa-ratio of 100% means the salary sits exactly at the reference point (midpoint or percentile).
- Below 85%: Significantly below market.
- 85% – 95%: Below market rate.
- 95% – 105%: Competitive with market.
- 105% – 115%: Above market rate.
- Above 115%: Significantly above market.
Indicative only. For pay decisions that matter, our consultants provide the full methodology and market data.
How to calculate a compa-ratio
- 1Find the midpoint of the employee's pay range — the market reference point for the role.
- 2Divide the employee's actual base salary by that midpoint.
- 3Read the result: 1.0 is exactly at midpoint, below 1.0 is under it, and above 1.0 is over it.
Frequently Asked Questions
What is a good compa-ratio?
Most organisations target a compa-ratio between 0.80 and 1.20, with fully competent employees sitting near 1.0 (the market midpoint). Below 0.80 can signal underpayment; above 1.20 can signal overpayment or a red-circled salary.
What does a compa-ratio of 1.0 mean?
It means the employee is paid exactly at the midpoint of their pay range — the market reference point for a fully competent performer in that role.
How is compa-ratio different from range penetration?
Compa-ratio measures pay against the midpoint, while range penetration measures how far pay sits between the minimum and maximum of the range. Use the range penetration calculator for the latter.
Is this compa-ratio calculator free?
Yes. It is completely free, runs in your browser and stores nothing. For the market data and range design behind the numbers, our consultants can help.