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Classification Performance Management

Broadbanding

What is it?

Broadbanding is the use of a salary structure divided into fewer, broader pay ranges than traditional grades.  There are two types of broadband structure:

Generally, organizations move to broadbanding by consolidating existing grades and pay ranges.  The table and chart below show how the General Schedule grades for professional work could be consolidated into broad grade and career band structures.

   

Broadbanding

 

General Schedule

"Broad grades"

"Career bands"

Number of ranges

8

4

2

Approximate range width

30%

60%

150%-190%

Who uses it?

Both the private and public sectors use broadbanding. The table below lists some well-known organizations that use broadbanding for some or all of their employees.

Private Sector

Public Sector

Bank of America

Baxter Healthcare

Boeing

Eli Lilly

General Electric

Georgia-Pacific

IBM

Merrill Lynch

Sears, Roebuck

The Scotts Company

Central Intelligence Agency

General Accounting Office

Department of Commerce

Department of the Air Force

Department of the Navy

Transportation / Federal Aviation Administration

Treasury / Internal Revenue Service

Treasury / Office of the Comptroller of the Currency

City of Charlotte, North Carolina

State of South Carolina

State of Virginia

Why broadbanding?

Broadbanding provides less structure than traditional grade systems. This relative lack of structure can improve organizational ability to:

Federal organizations adopt broadbanding to improve organizational performance. The table below lists the largest Federal users of broadbanding, and the specific reasons for adopting broadbanding.

 
Broadbanding System Reward Performance Improve Competitiveness Simplify            Classification Delegate     Authority

Reflect              Mission/    Nature of Work

Create          Flexibility

CIA / Telecommunications

 

l

     

l

Commerce

 

l

l

l

l

 

Commerce / NIST

l

l

l

l

l

l

DoD / Acquisition Workforce

l

l

l

l

 

l

DoD / Nonappropriated Fund Activities

l

l

l

l

l

l

DoD / National Imagery and Mapping Agency

l

         

DoD / Science and Technology Reinvention Laboratories

l

l

l

l

l

l

FAA

l

   

l

l

l

FBI

l

l

l

 

l

 

GAO

l

 

l

l

l

 

Interior / BIA

l

l

l

 

l

l

Navy / China Lake

l

l

l

l

 

l

Treasury

l

l

l

     

Treasury / IRS

l

   

l

 

l

Based on interviews with agency staff and written system descriptions.
Source: Office of Personnel Management.

 

Challenges and Keys to Success

As discussed above, broadbanding offers opportunities for positive change. However, those opportunities are accompanied by significant challenges, such as:

What Has the Experience Been?

Research and experience suggest that broadbanding is here to stay, although it’s not suited to all organizations. A recent study of broadbanding in private sector organizations finds that:

The Federal Experience

The Federal experience, like the private sector experience, has been largely positive.  Studies of broadbanding demonstration projects document many positive outcomes, including:

The results were sufficiently impressive that two early broadbanding demonstration projects have become permanent through legislation.  In light of these results and increased attention to aligning human resource practices with strategic goals, there are continuing calls to expand the use of broadbanding in the Federal Government.  Advocates include the National Academy of Public Administration and members of Congress.

For More Information / Links

For more information on broadbanding in the Federal Government, we suggest visiting OPM's demonstration project home page.

Other sources of information on broadbanding include:


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