July 16, 2026
Hi Everyone,
Salary bands give each role a clear pay range. They show the lowest, middle, and highest pay for that role, usually based on level, market data, and location.
That matters when review season comes around. A 3–4% raise may be fair, but it’s hard for a manager to explain if the employee can’t see where they sit in the range or what would move them higher. WorldatWork found that 68% of employees paid at or above market still think they’re underpaid.
When people don’t understand how pay is set, they fill in the blanks themselves.
Today, we’re covering how to build salary bands your managers can use in real pay conversations.
The problem with unclear pay
Only 32% of companies let employees see their own pay band. About half of organizations don't even train managers on how to talk about pay.
So employees piece together their own picture from Glassdoor, office gossip, and assumptions, and they usually get it wrong. An SHRM analysis of Payscale data found that only 11% of employees who believed they were underpaid actually were.
But the belief still affects how people behave. When someone believes they’re underpaid, they’re more likely to question the company’s decisions, compare outside options, and enter the next pay review already frustrated.
Salary bands won’t remove every hard pay conversation, but they give managers a clearer way to explain the number.
How GitLab uses bands in practice
How GitLab uses bands in practice
GitLab gives every employee access to the salary band for their role in Workday. They can see the minimum, midpoint, and maximum, with bands running from 80% to 120% of the market midpoint.
So if the midpoint for a role is $150K, the band runs from about $120K to $180K.
That gives managers a better conversation to have. Instead of saying, “That’s what the budget allowed,” they can explain where someone sits in the range, why they’re there, and what would move them higher.
The point isn’t to make every pay conversation easy. Some people will still want more than the company can pay. But bands give the conversation a structure both sides can see.
Payscale studied 578,000 US workers and found that pay transparency alone, including letting people see pay ranges, cuts intent to quit by about 30%.
The law is catching up
Pay ranges are becoming harder to keep private.
More US states now require salary ranges in job posts, and employees can see those postings too.
In Europe, the EU Pay Transparency Directive is pushing companies to give employees more information about how pay is set and how it compares across similar roles.
So if you don’t have clear bands yet, this is the time to build them.
How to get started
We put together a salary band builder you can download here and start working on this week.
It walks you through the full process we covered today. It also includes a conversation guide for four scenarios managers face every comp cycle and an AI prompt that handles the tedious role-mapping step.
Go deeper
👉 GitLab: Compensation handbook — Best if you want to see what a full salary band system looks like in practice. GitLab shows its calculator, market-based ranges, location factors, and how employees can check their own band.
👉 Buffer: Open salary system — Useful if you want to see the far end of pay transparency. Buffer publishes every salary and explains how its no-negotiation formula has changed over time.
👉 WVU: Tips for Having Compensation Conversations — Good for managers who need better wording in pay reviews. The guide includes simple ways to handle small raises, no raises, and difficult performance-linked pay conversations.
👉 Payscale: Fair pay perception and turnover — Worth reading for the research behind this issue. It explains why employees’ beliefs about pay fairness can matter more than where they actually sit against the market.
Coming up tomorrow
Tomorrow, we'll look at where a CEO's week really goes, and the five weekly habits that keep your week on track.
That's it for today!