Dear Prasad,

Compa-Ratio is the ratio of the actual pay rate (numerator) to the midpoint or some other control point for the respective pay range (denominator).

Compa-ratios are used primarily to compare an individual’s rate of pay to the mid-point or control point of the range. A compa-ratio may be calculated for an individual, a group of people, a department, or an entire organization.

Hope this helps : )

guy

Prasad,

Compa Ratio is a term used in the human resources specialty area of wage and compensation management. In its simplest form it is the ratio of an employee’s current wage to the organization’s benchmark rate, usually the salary grade midpoint. Compa-ratios are normally expressed as a percent of the benchmark. For example: An employee earns $45,000 per year in a job with a salary grade midpoint of $50,000. The equation is $45,000/$50,000 = 0.9. The employee is said to have a compa-ratio of 90%. Variations include: market compa-ratio or market ratio, target compa-ratio, group compa-ratios, wage index, competitive wage ratio. Compa-ratios are frequently used as one factor in wage increase matrixes used to determine annual salary adjustment.

Source: WikiPedia