Sample Promotion Advancement Salary Guidelines

Sample_Documents

DISCLAIMER: This is a sample template provided for informational purposes only. It does not constitute legal, tax, or financial advice. Organizations should consult their own legal and tax advisors and tailor this document to reflect their specific business needs, geographies, and applicable laws.

Promotion & Advancement Salary Guidelines

Company: <Company Name>

Document Type: Promotion & Advancement Salary Guidelines

Category: Base Compensation

Document Header

Field	Value
Title	Promotion & Advancement Salary Guidelines
Company	<Company Name>
Version	<Version>
Effective Date	<Date>
Last Reviewed	<Date>
Next Scheduled Review	<Date>
Policy Owner	<Total Rewards Leader/Function>
Approved By	<Approver Titles/Committees>
Supersedes	<Prior Policy/Version>
Applies To	<Global/Regional/Business Units/Entities> in <Country/Region List>
Related Documents	Base Pay Structure Policy, Annual Merit Guidelines, Job Architecture, Offer Letter Templates

Purpose and Objectives

• Establish consistent, equitable, and market-aligned salary placement and increase guidelines for promotions and in-level advancements across <Company Name>.
• Enable timely career progression while managing internal equity, pay transparency, budget stewardship, and compliance with local laws in <Country> and other jurisdictions.
• Provide clear roles, decision criteria, and approval requirements to support managers, HR Business Partners, and Talent Acquisition.

Scope and Applicability

• In Scope
  • Promotions involving a change in grade or job level within the <Company Name> job architecture.
  • In-level advancements (expanded scope, sustained higher impact) without a grade change.
  • Lateral transfers with no change in grade that may warrant a limited salary adjustment due to scope or market alignment.
  • All regular employees (full-time and part-time) paid on <Company Name> salary structures.
• Out of Scope
  • Temporary assignments, stipends, and acting pay (refer to Acting Pay Guidelines).
  • Hourly premium adjustments, shift differentials, and variable pay plans (refer to Variable Compensation Policy).
  • Equity awards; however, coordination with equity refresh guidelines is recommended (refer to Equity Grant Policy).
  • Interns, contractors, and agency workers.

Definitions and Guiding Principles

Key Definitions

• Promotion (Grade Change): Movement to a higher grade with increased scope, complexity, and market value.
• In-Level Advancement: Increase in base salary within the same grade to recognize sustained scope expansion, skill growth, and/or market alignment beyond typical merit.
• Lateral Transfer: Movement to a different role in the same grade; may warrant a limited salary adjustment if scope or market vary.
• Compa-Ratio: Employee salary divided by the grade midpoint (e.g., 0.92 equals 92% of midpoint).
• Range Penetration: Position of salary between range minimum and maximum.
• Red-Circled: Salary above range maximum; ineligible for base increases until range progression or re-leveling.
• Green-Circled: Salary below range minimum; must be increased at least to the minimum.
• Grade Delta: Number of grade levels moved at promotion (e.g., +1, +2).
• Market Reference Point (MRP) / Midpoint: The target reference rate for a job grade reflecting external market and internal positioning.

Guiding Principles

• Market Alignment: Place employees competitively to attract, retain, and motivate talent.
• Internal Equity: Similar roles, responsibilities, and performance in the same location should be paid similarly, considering tenure and skills.
• Differentiation by Impact and Performance: Recognize demonstrated capability, readiness, and scope expansion.
• Simplicity and Transparency: Provide clear, easy-to-apply guidelines and document rationales.
• Compliance and Ethics: Follow pay equity and transparency laws and avoid salary history in decision-making.
• Budget Stewardship: Use approved budgets, apply increases prudently, and prioritize highest-impact moves.

Pay Structure Overview

Salary Ranges and Midpoints

• <Company Name> uses a structured salary range system with minimum, midpoint, and maximum values for each grade.
• Midpoints are set using <Vendor Name> market data and benchmark job analysis; ranges are typically <Percentage> wide (e.g., 50% wide for professional grades).
• Range progression between adjacent grades is typically <Percentage> to <Percentage> (e.g., 10% to 12% midpoint progression).
• Geographic differentials apply in <Country/Region> using location factors of <Percentage> to <Percentage> from the <Company Name> Global Pay Zones.

Positioning Philosophy

• Target compa-ratio upon promotion is typically 0.90 to 1.05 depending on performance, scarcity, and internal equity.
• Higher placement within range may be warranted for hard-to-fill skills, critical roles, or exceptional sustained performance with documented evidence.

Eligibility and Triggers

Promotion Eligibility

• Role re-evaluation indicates a higher grade due to increased scope, complexity, and accountability.
• Employee meets minimum qualifications for the new level and demonstrates sustained readiness, not just potential.
• No active performance or disciplinary action within the past <Number> months, unless exception approved by <Approver Role>.
• Minimum time-in-role guideline of <Number> months, unless the business case demonstrates significant organizational need.

In-Level Advancement Eligibility

• Documented expansion of responsibilities sustained for at least <Number> months.
• Market movement outpacing annual merit guidelines causing compression risks.
• Critical retention needs substantiated by recruiting benchmarks and internal equity analysis.

Timing

• Promotions may occur off-cycle as needed; in-level advancements are preferably aligned to the annual compensation cycle, except for urgent retention or equity cases.
• Effective dates should be the start of a pay period; consult local payroll calendars for <Country>.

Salary Increase Guidelines

Recommended Increase Ranges by Grade Delta

Move Type	Recommended Range	Typical Median	Approvals
Lateral (no grade change)	0% to 3%	1%	Manager + HRBP
In-Level Advancement (same grade)	2% to 6%	4%	Manager + HRBP + Total Rewards
Promotion +1 Grade	5% to 10%	8%	Manager + HRBP + Total Rewards
Promotion +2 Grades	8% to 15%	12%	Add <Director/VP> Approval
Promotion +3 or more Grades	12% to 20%	16%	Add <CPO/CFO> Approval

Application Notes

• Use the ranges as guidance; actual increases depend on compa-ratio, internal equity, market tightness, and budget.
• If the resulting salary falls below the new grade minimum, adjust to at least the minimum, even if this exceeds the guideline range.
• Employees above the new grade maximum remain red-circled; no base increase unless documented exception.
• In pay transparency jurisdictions in <Country/Region>, adjustments must be consistent with posted ranges.

Target Range Positioning After Promotion

• For strong performers with compa-ratio below 0.85, target placement at 0.90 to 1.00 compa-ratio post-promotion.
• For exceptional performers or critical-skill hires, consider 0.95 to 1.05 compa-ratio, ensuring equity with internal peers.
• Avoid setting above 1.10 compa-ratio at promotion except with <CPO> approval.

Example Calculation

Illustrative only; replace with <Amount> and <Percentage> values appropriate to <Company Name> ranges.

Item	Value
Current Grade / Salary	G6 / 72,000
New Grade Midpoint	G7 Midpoint = 85,000
Grade Minimum to Maximum	72,250 to 97,750
Current Compa-Ratio	72,000 / 85,000 = 0.85
Recommended Increase (8%)	5,760
Proposed New Salary	77,760
New Compa-Ratio	77,760 / 85,000 = 0.91
Check Against Range	Within Min/Max

Special Considerations

• Compression and Equity: If the promotion creates inversion with peers or direct reports, adjust within budget to maintain a logical hierarchy.
• Market Catch-Up: When the external market has shifted materially (> <Percentage>% midpoint change), prioritize higher placement.
• Retention Risk: Document competing offers or market hiring rates from <Vendor Name> benchmarks to justify upper-tier increases.

Geographic and Job Family Differences

Geographic Differentials

• Apply <Company Name> location factors to both current and target range midpoints when promotions involve a location change.
• For remote-to-office or office-to-remote changes, re-evaluate the geographic pay zone before finalizing salary.
• In certain countries, statutory requirements may constrain off-cycle increases; consult local HR in <Country>.

Job Family Practices

• Sales roles: Coordinate base increases with variable target adjustments; maintain on-target earnings alignment with plan design.
• Technical roles: Scarce skill premiums may justify compa-ratios near or slightly above midpoint; require Total Rewards review.
• People leaders: Consider the span of control increase; ensure direct reports’ salaries remain equitable.

Roles and Responsibilities

Decision Roles

• Manager
  • Initiates request, provides business case, and confirms performance and readiness.
• HR Business Partner (HRBP)
  • Validates job leveling and supports equity assessment.
• Total Rewards
  • Confirms grade, range, geographic factors, and recommends increase amount within guidelines.
• Finance
  • Confirms budget availability and tracking against <Budget Name>.
• Approvers
  • Approve per the matrix below and ensure compliance.

Approval Matrix

• In-level advancement up to <Percentage>%: Manager + HRBP + Total Rewards
• Promotion +1 grade up to <Percentage>%: Manager + HRBP + Total Rewards
• Promotion +2 grades or > <Percentage>%: Add <Director/VP>
• Any increase placing salary > range max or > <Percentage>%: Add <CPO/CFO>

Process and Implementation

Standard Workflow

1. Manager submits Promotion/Advancement Request in <HRIS Vendor Name> with justification and updated job description.
2. HRBP reviews leveling against Job Architecture and confirms eligibility.
3. Total Rewards validates grade, range, compa-ratio, geographic factors, and recommends increase amount.
4. Finance reviews budget impact and assigns cost center approval in <Finance System Vendor>.
5. Approvers review and provide electronic signatures in <HRIS Vendor Name>.
6. Total Rewards finalizes salary and effective date; HR Operations processes in payroll.
7. Talent Acquisition updates any posted ranges and candidate communications if applicable.
8. Manager delivers the promotion communication using approved messaging and timelines.

Required Documentation

• Updated job description with scope, responsibilities, and decision rights.
• Market data summary from <Vendor Name> including benchmarks and target percentiles.
• Internal equity analysis showing relevant comparators by location and tenure.
• Business case including expected outcomes and organizational impact.
• Approvals per the matrix captured in <HRIS Vendor Name>.

Effective Date and Retroactivity

• Effective dates should align to the start of a pay period in <Country>.
• Retroactive adjustments are discouraged and require <CFO> approval when payroll deadlines were met.

System Configuration and Coding

• Use action reason codes: Promotion, In-Level Adjustment, Lateral Alignment.
• Ensure geo zone, grade, and FLSA/Local Exemption status are correct.
• Map to compensation components for analytics and pay equity reporting.

Budgeting and Controls

Funding Approach

• Annual planning includes a promotion and advancement budget of <Percentage>% to <Percentage>% of base payroll, separate from merit.
• Off-cycle requests draw from a central or business unit reserve; track year-to-date usage in <Reporting Tool>.

Prioritization Criteria

• Critical role or business continuity risk.
• Documented market gap exceeding <Percentage>% vs. target compa-ratio.
• Equity gaps that risk compliance exposure.

Monitoring Metrics

• Promotion rate by demographic and job family.
• Average promotional increase by grade and geography.
• Post-promotion compa-ratio distribution and equity drift.
• Budget utilization vs. plan.

Compliance and Legal Considerations

Global and Local Requirements

• Do not consider salary history where prohibited by law in <Country/Region>; rely on market data and internal equity.
• Follow pay transparency requirements, including disclosure of ranges in postings and employee communications where required.
• Comply with equal pay and comparable work statutes; analyze promotions for adverse impact and systemic bias.
• Works council or employee representative consultations may be required in <Country>; coordinate timelines.
• Maintain records of decisions and rationales for at least <Number> years or as mandated.

Privacy and Data Handling

• Limit access to compensation data to authorized personnel.
• Use aggregated, de-identified data for analytics where feasible and comply with <Country> privacy laws.

Detailed Application Guidance

Determining the Increase Within the Range

• Start with the grade delta guideline.
• Adjust up or down based on:
  • Compa-ratio gap to target (e.g., target 0.95).
  • Performance and demonstrated impact.
  • Scarce skill premium considerations.
  • Internal equity relative to peers and direct reports.
  • Budget capacity and timing within the fiscal year.
• Ensure the new salary does not exceed the range maximum without required approvals.

Handling Edge Cases

• Green-Circled Employees: Increase to at least range minimum; additional increase may be used to reach target compa-ratio.
• Red-Circled Employees: No base increase; consider lump sum if acknowledgment is warranted and allowed by local policy.
• Job Architecture Realignment: If a family-wide re-leveling occurs, apply structure update first, then individual adjustments.

Coordination with Variable Pay and Equity

• When promotion changes bonus target, pro-rate eligibility according to the variable plan rules.
• Equity refresh or new-hire grant adjustments should reflect new level norms and internal equity; align timing to the next grant cycle unless business need dictates otherwise.

Examples and Scenarios

Replace illustrative numbers with <Amount> and <Percentage> values consistent with <Company Name> structures.

Scenario	Before	After (Recommended)	Rationale
In-Level Advancement (scope growth)	G6, 88% compa-ratio	+4% to 92%	Sustained broader scope; preserves equity with peers
Promotion +1 Grade, low compa-ratio	G6, 80% compa-ratio	+10% to reach 88%	Market catch-up plus promotion
Promotion +2 Grades, critical skill	G5, 95% compa-ratio	+14% to 1.02 compa-ratio	Scarce skills; ensure parity with team leads
Lateral transfer to higher-cost geo	Same grade, 90% compa-ratio	+3% and geo factor	Align to geo zone; limited adjustment to reflect market

Review and Approval Process

Review Cadence

• Policy reviewed at least annually or when market movement exceeds <Percentage>% midpoint shift for key families.
• Total Rewards updates ranges and guidelines following the annual market review cycle in <Quarter>.

Formal Approval

1. Draft revisions by Total Rewards with input from HRBPs and Finance.
2. Legal review for compliance with <Country/Region> laws.
3. Executive approval by <CPO> and <CFO>.
4. Publication in <Intranet Name> and configuration updates in <HRIS Vendor Name>.

Governance and Exceptions

Exception Criteria

• Increases exceeding guideline maxima.
• Placement above 1.10 compa-ratio.
• Retroactive effective dates beyond <Number> pay periods.
• Promotions during active performance improvement plans.

Exception Process

1. Manager and HRBP submit exception case with data and rationale.
2. Total Rewards performs equity and budget impact analysis.
3. <CPO/CFO> or designated committee reviews and approves or denies.
4. Document decision and store in employee file per retention rules.

Implementation Checklists

Manager Checklist

• Confirm role change and business need.
• Align with HRBP on level and timing.
• Prepare employee talking points.
• Submit complete request with documentation.

HRBP Checklist

• Validate job leveling and performance record.
• Review internal comparators and equity.
• Ensure approvals align with the matrix.
• Coordinate with Talent Acquisition if role is posted.

Total Rewards Checklist

• Validate range, geo zone, and compa-ratio target.
• Recommend increase within guidelines.
• Confirm budget and code in <HRIS Vendor Name>.
• Schedule effective date with payroll.

Reporting and Audit

Standard Reports

• Monthly promotion and advancement dashboard by business, grade, geo.
• Quarterly pay equity check post-promotion.
• Annual outcomes review: promotion velocity, diversity metrics, retention post-promotion.

Audit Practices

• Random sample audit of <Percentage>% of promotions each quarter.
• Document exceptions and corrective actions.

Glossary

• Annual Merit
  • The standard annual increase process tied to performance and market movement.
• Benchmark Job
  • A job matched to external market data used to set pay ranges.
• Geo Differential
  • Location-based adjustment applied to pay ranges to reflect cost or market differences.
• Job Architecture
  • Structure defining job families, levels, and associated competencies.
• Midpoint Progression
  • The percentage difference between grade midpoints.
• Range Width
  • Difference between minimum and maximum divided by midpoint, expressed as a percentage.

Appendices

Appendix A: Data Inputs

• Market sources: <Vendor Name 1>, <Vendor Name 2>.
• Internal comparators: peers in same grade, job family, and geo with similar tenure.
• Budget parameters: Annual promotion pool <Percentage>% of payroll.

Appendix B: Sample Approval Language

• “Approved: Promotion to <New Grade/Title> effective <Date> with a base salary of <Amount>, reflecting an increase of <Percentage> based on scope expansion, performance, and market alignment. Reviewed for equity with <Number> internal comparators in <Location>.”

Appendix C: Sample Business Case Outline

1. Summary of role and scope increase
2. Job leveling assessment and mapping
3. Market data and internal equity findings
4. Recommended salary and compa-ratio
5. Budget and financial impact
6. Risks if not approved

Communication to Employees and Managers

This section is written for employees and managers and may be shared broadly. Customize names, dates, and contacts for <Company Name>.

At <Company Name>, promotions and salary advancements recognize meaningful growth in your role, the impact you deliver, and how your responsibilities have expanded over time. Our goal is to ensure that pay decisions are fair, consistent, and aligned to market rates in your location.

What is a promotion vs. an advancement? A promotion reflects a move to a higher job level with greater scope and complexity. An in-level advancement increases base salary within the same job level to recognize sustained growth in responsibility or to better align with the market. Lateral moves to a different role at the same level typically do not receive an increase, but in some cases a small adjustment may be made to reflect scope differences.

How we decide new salaries We look at three things:

1. The job level and its salary range for your location.
2. Your current position in that range and your performance and impact.
3. How your pay compares to teammates in similar roles and to the external market.

When you are promoted, we aim to place your salary appropriately within the new range. Strong performance can lead to a higher placement within the range, while ensuring consistency with others doing similar work. If your salary falls below the new range minimum, we will move it to at least the minimum.

Typical increase ranges Promotion increases usually fall between 5% and 10% for a one-level move, with larger increases for bigger jumps in responsibility. In-level advancements usually range from 2% to 6%. These are guidelines, and actual increases may vary based on role, location, performance, and internal equity.

Timing and communication We process promotions when the new scope is in place and approved. In-level advancements typically occur during our annual compensation cycle, although we may make off-cycle adjustments for retention or significant market changes. Your manager will discuss any changes with you and explain how your new salary was determined, including your job level, salary range, and effective date.

Your role in the process If your responsibilities have grown or you are considering a new role, talk with your manager about your development and career path. Keep your goals up to date and discuss the skills and outcomes needed for the next level. We encourage open conversations about roles and responsibilities; while we do not discuss other employees’ pay, we will share the salary range for your job and location upon request where required by law.

Pay equity and fairness We regularly review pay practices to identify and address any unintended differences. We do not use salary history to make pay decisions. We base salary changes on the job, your contributions, and the market in your location. If you have questions or concerns, contact <HR Contact/Inbox>.

Where to get help For questions about your salary, promotion, or job level, please reach out to your manager or HR Business Partner. For confidential questions, you can also email <HR Inbox> or visit our Compensation page on <Intranet Name> for resources, including salary range information and promotion criteria by job family.

Effective date These guidelines are effective <Date> and will be reviewed regularly to ensure they remain aligned with the market and our values.

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Document Information:

• Document Type: Promotion & Advancement Salary Guidelines
• Category: Base Compensation
• Generated: August 24, 2025
• Status: Sample Template
• Next Review: <Insert Review Date>

Usage Instructions:

1. Replace all text in angle brackets < > with your company-specific information
2. Review all sections for applicability to your organization
3. Customize content to reflect your company's policies and local regulations
4. Have legal and HR leadership review before implementation
5. Update document header with your company's version control information
6. At bottom of the document you find a short example on how the content could be communicated to end-users, for instance employees.

This sample document is provided for reference only and should be customized to meet your organization's specific needs and local legal requirements.