The traditional approach to salary bands assumes resources most SMEs don't have. A Mercer or Willis Towers Watson engagement runs €15–€40k per year for survey access; the consultancy work to translate the survey into your role architecture adds another €30–€80k. Six months is a realistic timeline. The compensation team that operates the structure afterwards is one or two FTE.

For a 200-person company facing a June 2026 transposition deadline, that's the wrong solution. Not because the traditional approach is wrong — it's right for the companies it was built for. Wrong because the assumptions about who is doing the work don't hold.

This article describes a minimum viable salary band structure that an HR Director can build alone with a spreadsheet, an honest view of the existing team, and about three weeks of focused work. The output is not as polished as a consultancy deliverable. It is, however, defensible — which is the standard the directive actually requires.

What the directive actually asks for

The directive does not require salary bands. It requires that pay decisions be explainable on objective, gender-neutral grounds, applied consistently across categories of equal work or work of equal value.

Salary bands are not the obligation; they are the most practical artefact that satisfies the obligation. A documented band tells the regulator (and the works council, and the employee asking under Article 7) where each role sits in a structure, why an offer was at that level, and how variation within the band is explained.

The directive accepts any methodology that meets three criteria: transparent, documented, gender-neutral by design, and applied consistently. The five-step build below produces exactly that.

The five-step build

01
Map roles into job families. Start with the current org chart. Group roles by what they actually do — not by which manager they report to. Typical SME ends with 8–15 families: Engineering, Product, Sales, Customer Success, Operations, Finance, People, Legal, etc. Within each family, define the levels (typically 4–6: Junior → Mid → Senior → Lead → Manager → Director). This produces the role grid that everything downstream depends on. Two days.
02
Calibrate against publicly observable references. For each family × level cell, gather three external reference points — recent hires the company made (offer letter data), recent hires the company didn't make (rejected candidates whose ask was on file), and publicly disclosed ranges (job adverts from comparable companies in the same geography). The triangulation produces a market reference that does not require a paid survey. Three to five days, depending on company size.
03
Define each band: floor, midpoint, ceiling. For each role grid cell, set a midpoint (the calibrated market reference), a floor (typically 80–85% of midpoint), and a ceiling (typically 115–120% of midpoint). The ±15–20% width gives room for performance and experience differentiation without making the band so wide it loses meaning. One day.
04
Place existing employees in their band — and surface the outliers. For each current employee, identify their role grid cell and their position within the band (below floor / between floor and midpoint / between midpoint and ceiling / above ceiling). The placement surfaces every outlier. Above-ceiling positions are typically retention-driven legacy decisions. Below-floor positions are the compression cases. Both require documented rationale. Two days for a 200-person company.
05
Document the methodology and the rationale catalogue. Write down the methodology used (steps 1–4 above), the band values per cell, the placement of each employee, and the rationale categories used for above-band and below-band cases. This document is what the regulator, the works council, and the employee Article 7 requester all read. Without it, the structure exists but cannot be defended. Two days, longer for larger companies.

Total: three weeks of focused work. The output is a documented salary band structure, a placement of every current employee, and a methodology that can be audited.

What this approach does not give you

A €40k consultancy engagement produces a deliverable that is more polished than the five-step build above. Three things the consultancy delivers that the SME approach does not:

For a 200-person SME, the cost of these three losses is rarely worth the €40k. The directive does not require statistical confidence intervals; it requires documented methodology. The directive does not require fine-grained sector benchmarks; it requires the methodology be applied consistently. The directive does not require annual professional refresh; it requires the methodology to be maintained.

Maintenance — what year two looks like

The structure is not a one-shot artefact. It has to be maintained annually for the directive's documentation to remain current.

The annual maintenance cycle:

The maintenance cycle is what makes the bands defensible over time. A band structure that exists on paper but has not been updated in two years is harder to defend than no structure at all — it suggests the company built the artefact for compliance reasons but is not actually using it to set pay.

Worth noting

"Worth considering" alternative for SMEs that do want survey data: WTW's lower-tier package, Radford's startup-focused product, or industry-association salary surveys (these are cheaper and often more relevant than the flagship Mercer survey for SMEs). The SME approach above is the lower bound — the minimum that satisfies the directive. A purchased survey can refine step 02, but the rest of the build remains the same.

How this feeds the directive's report

The five-step build is not designed primarily for the report. It is designed primarily for pay decisions. But the same artefact answers the report's questions.

Step 01 (the role grid) is the category structure for Article 9 metrics 08–09. Step 03 (the band values) is the documented compensation basis. Step 04 (employee placement) is the cohort data for per-category gap calculations. Step 05 (methodology document) is what is examined if the report is challenged.

The work done to build the band structure is the same work the directive requires. The structure is the artefact. The defence is implicit.

The consultancy delivers the artefact. The structure delivers the defence. For most SMEs, the second is what the directive actually asks for.

Where the diagnostic starts

Before running the five-step build, an honest view of where the company currently sits is useful. The ReadinessCheck™ surfaces, by axis of the directive's principal obligations, what is already documented and what is missing. The result determines whether the build above takes two weeks or four.

For the company that already has a clean payroll export and an existing role taxonomy, PayGapCheck™ can run the per-category metrics directly from the uploaded data — useful once the band structure exists and the calibration is complete.

From structure to numbers

The band structure is the foundation. The analytical report is the output.

PayGapCheck™ takes a salary file and produces the analytical report — overall and per-category gaps, quartile distributions, and the metrics Article 9 requires. The band structure built via the five-step process above is the input that makes the report defensible.

Start the analysis →