Some companies may pay employees in certain markets at a premium based on competitiveness of the market or higher cost of living. For example, employees living in New York, San Francisco, or Seattle may be paid at a higher rate than employees living in other cities with a lower cost of living.
Companies may also use Payzones when operating in multiple countries and thus allowing for pay bands in different currencies. Learn more about Support for Multiple Currencies in Agora here.
With Agora, you are able to create different Payzones in order to display changes in compensation bands based on location. You must always have at least one Payzone.
Note: You must be an Owner or in a Permission Group that contains Company Settings permissions in order to create or edit Payzone information
To create/edit Payzones
Follow these steps:
By default you will have a Payzone named Tier 1 - click in to it to rename or delete it:
3. Optional: If this Payzone is not the Baseline, you may indicate another Payzone to be the Baseline. (See examples below)
When using Baseline / Non-Baseline compensation bands, you have the ability to automatically apply discounts between 0-1. However, it is not required to set up a relationship between the bands or to apply a discount.
4. If you choose to set a Baseline payzone to track other Payzones against, you have the ability to apply a discount. Compensation bands in this discounted Payzone will equal to (baseline band) x (discount rate).
Use cases:
Use Case 1: Automatically apply a discount based on location
A New York based company has set compensation bands by ladder and level but applies a pay discount of 10% (base salary x .9) for employees living outside of "Tier 1" cities which they define as New York or San Francisco.
Tier 1 (Baseline)
Level | Salary Low | Salary Target | Salary High |
L1 | $100,000 | $120,000 | $130,000 |
L2 | $120,000 | $130,000 | $150,000 |
All other US Cities (discounted by .9)
Level | Salary Low | Salary Target | Salary High |
L1 | $90,000 | $108,000 | $117,000 |
L2 | $108,000 | $117,000 | $135,000 |
Use Case 2: Multiple compensation bands but no standard discount
A Toronto based company operates both in the US and Canada. They have the same ladders and levels in each country, but use different currencies and compensation bands.
Canada
Level | Salary Low | Salary Target | Salary High |
L1 | CAD$ 120,000 | CAD$ 130,000 | CAD$ 140,000 |
L2 | CAD$ 130,000 | CAD$ 140,000 | CAD$ 160,000 |
United States
Level | Salary Low | Salary Target | Salary High |
L1 | $100,000 | $120,000 | $130,000 |
L2 | $120,000 | $130,000 | $150,000 |
Referencing Payzones
When viewing or editing compensation bands within your Ladders, you have the ability to toggle between multiple Payzones.
When creating an Offer Letter, you'll be able to map the candidate to a Ladder/Level and see where they sit within the corresponding band within that Payzone.
You'll need to select both an Internal Role and a Payzone (if you have more than one).
The Compa Ratio is where the candidate is at in relation to the Salary Target or Equity Target in that Payzone.
