Short answer
Compensation design builds pay structures and decisions from defined principles, market evidence, and internal equity. It rates the quality of the structure and the decision record, not secrecy or toughness in offers.
About Compensation design
Builds pay structures and decisions from defined principles, market evidence, and internal equity. Strong work makes ranges, exceptions, and rationale visible enough that another practitioner could reconstruct the choice.
Use this competency for
- People or finance roles that design salary ranges, bonus structures, or offer guidelines.
- Functions accountable for consistent pay decisions across comparable roles.
Do not use this competency for
- Do not use it to rate how hard someone negotiates an individual offer, or to infer fairness from a single anecdote.
Important distinctions
Benefits administration
Benefits administration operates existing programs. Compensation design creates the pay structure those programs sit beside.
Expectations by level
IC1
Applies defined ranges with guidance
Applies published ranges and guidelines with support, documents exceptions, and flags missing data before a pay decision is sent.
Observable behaviors
- Uses the current range and job level for the role.
- Records the reason when a recommendation sits outside the range.
- Checks that comparable peers were considered with the data available.
Examples
- Paused an offer draft when the role level in the system did not match the Function's published ladder.
- Attached the range and market note to an offer packet for the hiring manager.
IC2
Designs pay decisions for a Function
Independently prepares pay recommendations for a Function, reconciles market data with internal equity, and explains trade-offs to the decision maker.
Observable behaviors
- Builds a comparison set with explicit inclusion rules.
- Separates a one-off exception from a structure problem.
- Writes a rationale a later reviewer could follow.
Examples
- Recommended a range change after several similar roles needed the same exception.
- Showed where a proposed raise would sit relative to peers in the same level.
IC3
Sets pay structure across Functions
Defines or revises pay architecture used by multiple Functions and changes principles when evidence shows inequity or unusable ranges.
Observable behaviors
- Publishes principles that hiring managers can apply without a private conversation.
- Reviews exception patterns and updates the structure.
- Coordinates finance and people owners on one decision record.
Examples
- Collapsed overlapping bands after managers could not tell IC3 from IC4 pay.
- Introduced a documented exception path after off-cycle changes left no audit trail.