How to Build a Job Leveling Matrix (With Template and Examples)

A job leveling matrix is a tool organizations use to define and categorize job roles based on specific criteria such as skills, experience, responsibilities, and impact. This matrix is essential for creating a fair and transparent compensation structure, providing clear career paths, and aligning particular roles with the company’s overall strategy.

This guide will discuss the key considerations and steps in creating a customized job classification matrix that aligns with your organization’s goals.

Key components of a job leveling matrix

The following building blocks are common in job leveling classifications:

Job levels

Job levels illustrate the ranks and associated responsibility throughout your organization, from individual contributors to members of your C-suite. Your matrix might group levels as:

• Junior
• Mid-level
• Senior
• Leadership

If you need more depth, your matrix can accommodate different sublevels, such as Mid-level I, II, and III.

Job families

Job families categorize similar roles into groups that share similar functions. For example, administrators across a hospital facility might belong to the same job family even if they work in different inpatient and outpatient settings.

Criteria for leveling

A job leveling matrix should be fair and equitable, requiring defined criteria to justify why you’ve classified each role within a particular level or group. Your criteria might be based on:

• Scope of responsibility
• Decision-making authority
• Skills required for the role
• The role’s impact on the organization
• Scope for lateral career moves

How to create a job leveling matrix in 9 steps

Follow this step-by-step guide to developing a job-leveling matrix tailored to your business needs:

Step 1: Define the scope and framework of the process

Begin by establishing your North Star. Why have you committed to the job leveling process? Some possibilities include:

• Reducing employee turnover by providing more structure in your organization so everyone knows where they stand
• Leveling compensation to clarify which roles correspond to which salary band
• Provide clearer boundaries between roles so employees and their team members know where they stand
• Eliminate redundancies where several employees appear responsible for the same tasks

Based on your goals, you may also make initial decisions about

• How many levels to include
• How many job families
• Your basic leveling criteria

Your company size will likely influence these decisions. For example, a smaller company may only need three levels—junior, intermediate, and senior—while an enterprise organization might have five levels, each with three sublevels.

Decide who is in charge of designing the framework. Will you put a face to the process and assign the task to a single person? Or share the responsibility with several stakeholders, requesting feedback and input from various people?

Step 2: Analyze your current workforce structure

Collect relevant information from HR to start building your current workforce structure. This enables you to:

• Create an inventory that lists all current roles in your org chart and their associated job duties
• Establish clear links between one role and the next, for example, a direct report and their supervisor or manager
• Assess the skills and competencies required for each employee to be successful in their role. These will likely include core competencies expected in all organizational roles, such as collaboration and strong communication. However, they may also include role-specific skills such as project management or proficiency in bookkeeping.

This step goes hand in hand with creating or working from a competency model framework.

Step 3: Define job families and roles

Decide how you’ll group jobs together. Roles within a job family don’t need to be carbon copies of each other but must share familiarities. Usually, they’re related by one or more of the following:

• Function: For example, IT or HR
• Occupation: For example, sales or engineers
• Business unit: For example, customer service or research and development
• Skill or competency: For example, leadership or critical thinking

Begin by collecting job descriptions and identifying similar jobs, such as overlapping business objectives or skill sets. For example, you may group sales and marketing teams within the same job family.

Don’t fall into the trap of blurring lines between roles within the same job family. Ensure accountability by clearly defining each role, including its individual responsibilities and expected outcomes.

Step 4: Establish criteria for each level

Determine how one level is distinguishable from another with transparent criteria, including:

• Scope of responsibility: Ensure your matrix details how responsibility increases with each level—for example, a Level 1 accountant may be required to assist with financial report preparation, while the overall responsibility lies with a Level 2 accountant to prepare, review the reports
• Varying skills and competencies: Using the same example, the Level 1 accountant requires technical and financial skills, while Level 2 and Level 3 accountants also need strong decision-making skills
• Impact on the organization: Entry-level employees typically impact day-to-day operations, mid-level roles may influence some company decision-making, while senior-level positions will be involved in strategic thinking
• Promotion criteria: Employees must understand what they need to do to progress from their current level to the next—are there specific timelines or expectations to continue progressing?

Example: Equity management company Carta uses an eight-level matrix for its engineers. Employees must commit to career growth and progression, receiving promotions every few years until they reach Level 5 (considered a terminal level). Being stuck in a level for too long may be considered a performance issue.

Step 5: Develop the matrix structure

Design and populate the matrix so it visually represents your organization’s roles and levels. Your structure should be clear for employees and managers, making career development and progression easy to understand.

In its simplest form, your matrix involves a horizontal and vertical axis with various intersection points.

For example, you might label your horizontal rows with job titles and your vertical roles with job levels, then use the intersection points to list key information like skills, responsibilities, and impact. Here’s what the finished result could look like:

Step 6: Align compensation with job levels

People working at different levels expect their compensation to align with their level of skill, responsibility, and impact. So, take a structured approach to assigning salary bands and promotion opportunities to each job family level.

Begin by conducting market research to understand how your salaries match industry standards. You might use third-party benchmarking consultants to support this step or rely on sources like Glassdoor or PayScale to provide current data.

Note: Compensation is highly sensitive to location, company size and revenue, and working models, such as remote or in-house roles.

The next step is to develop a compensation structure that aligns pay scales with each job level. Do this by:

• Establishing a pay range: A Level 1 Accountant might have a salary range of $45,000 to $55,000, while a Level 3 Accountant could earn between $80,000 and $95,000. These ranges provide in-level flexibility based on experience, performance, and qualifications
• Denoting pay progression within levels: Detail how the number of years of experience, completed certifications, or performance evaluations may influence pay progression
• Clarifying how you’ll incorporate bonuses: For example, what types of incentives are available at each job level?

Step 7: Validate and communicate the matrix

Before rolling out your job matrix, review and share it with all key stakeholders, such as HR leaders and department heads, to ensure accuracy and buy-in.

Encourage detailed input, especially when determining where specific roles fit within a family and whether the responsibilities, skills, and progression criteria make sense at each level. Based on this feedback, refine your matrix so it’s as accurate and inclusive as possible. You may need to repeat this process several times until you have the best version of your matrix.

Next, plan how to communicate it to your employees. Your framework will directly impact everyone in your organization, influencing their development paths, growth opportunities, and pay. So, individual workers must understand how it works and what it means to them.

Communicate your matrix by:

1. Workshops: Organize a series of workshops or town hall meetings where you can explain the matrix in detail
2. Written documentation: Create a comprehensive guide or FAQ document outlining the matrix and distribute it through internal communication channels such as email or intranet
3. Q&A sessions: A chance for employees to gather and receive clarity on their concerns
4. Ongoing communication and support: Provide follow-up sessions or check-ins where employees can revisit the matrix, ask new questions, and get additional support from HR or their managers

Step 8: Educate leadership and HR teams

Communication and rollout of your job leveling framework will be significantly easier if your managers and leaders know how to answer any questions about it. They should also know how to incorporate discussion of the matrix in employee development conversations.

In-house training programs are a valuable way to convey this information to managers and company leaders. Key training topics include discussions about:

• Promotion criteria: Do managers know how to progress their employees to new roles and levels?
• Level nuances: Do they understand how to distinguish the different levels in their specific teams?
• Career planning: How can managers encourage employees to progress within a single family or move laterally to another job family once they’ve reached a role or level milestone?
• Employee evaluations: How should managers incorporate leveling discussions as part of ongoing performance evaluations?

Step 9: Roll out the job leveling framework

Successful implementation of your framework requires careful planning for a smooth transition. Make decisions on the following:

• Rollout type: Will you opt for a phased or full rollout? A phased approach might use the framework in a branch before going company-wide, for example
• Points of contact: Employees need to know who to contact with any queries about their role and how it fits into the overall structure. Often, the best points of contact are HR professionals, managers, or department heads
• Integrations: If you have existing HR frameworks based on career pathing or payroll, decide how your new matrix will integrate with or replace them.

Once you’ve announced the rollout, collect feedback using a variety of surveys, 1:1 meetings, and focus groups to understand how it’s impacted the employee experience. As a best practice, do this periodically to allow your workers to settle and understand the framework. Make changes based on this feedback and any organizational changes. For example, if your business expands into a new area, you may need to incorporate additional roles into your job leveling matrix so it remains current.

Job leveling matrix template

Leveling isn’t something you need to tackle from scratch. Our job leveling matrix template uses a sequential approach, allowing you to:

• Identify the career path and tracks in your organization
• Define career levels as a clear progression hierarchy
• Structure your career framework according to values, competencies, etc.
• Select core competencies
• Map competencies to specific roles

Download our template to kickstart your job leveling process.

Job leveling examples

Be inspired by how other top companies approach job leveling with these three real-life examples:

Wise

Money transfer company Wise has recently revamped its leveling matrix, adding more depth and specification to individual roles. Each role now includes details about the skills, behavior, expertise, and scope, including how it influences teamwork and overall company culture.

EY

EY’s framework focuses on career development opportunities, offering seven different levels:

1. Entry-level employees: Trainees, associates, and consultants
2. Seniors: Employees with initial management responsibilities
3. Managers: Those managing several projects in parallel and who are responsible for client communication
4. Senior managers: Leaders with expanded client relationships who take more ownership of sales and people development
5. Directors: Leaders charged with complex projects and larger teams specializing in a particular topic
6. Associate partners: Directors in charge of top-level strategies
7. Partners: A co-owner of the company with an entrepreneurial focus

Carta

Carta’s eight-level framework isn’t strictly linear, and some levels are harder to achieve than others, especially at high-impact levels. Employees must be able to demonstrate consistent performance over time to level up. Movement into management roles is treated as a lateral shift, with its own set of levels from M4 to M9 rather than L1 to L8, reflecting the extra responsibility required.

Carta’s compensation also increases with seniority, but equity compensation grows superlinearly at higher levels, making it a defining factor of the leveling structure.

Job leveling for startups vs. established enterprises: Key factors to consider

The age and size of your business greatly influence how you approach job leveling.

Startup leveling tends to be more flexible and informal as roles blend across functions and employees wear multiple hats.

For example: A Marketing manager in a startup may also oversee sales, customer service, and even product development, making it difficult to define traditional job levels. As the startup grows, these blended roles may split into specialized positions.

In this environment, job leveling frameworks need to reflect adaptability, broad skill sets, and rapid career progression to keep pace with the company’s growth. The challenge, however, is defining clear development paths in such a fluid setting.

In contrast, established enterprises (or even smaller, mature companies) tend to have more structured job leveling systems. It’s easier to define specific roles and career progression paths because you likely already have some form of job leveling in place. However, if your current system is inconsistent, creating clear frameworks for role progression should be a priority as you scale across larger teams and departments.

For example: In a more established company, the Marketing manager will have clearly defined responsibilities such as overseeing campaigns, managing a team, and reporting KPIs, with clear steps to move into roles like Senior marketing manager or Director of marketing.

Develop and manage multi-level career frameworks with Deel Engage

Deel Engage makes it easy to set up a meaningful job leveling framework for your company. Our all-in-one suite includes the following features to achieve role clarity within a culture that emphasizes continuous development:

1. Career management: Create clear frameworks, including the competencies and values that define success within every career path
2. Performance management: Enable your people to reach their full potential, tying individual OKRs and goals to your leveling framework to set them up for success
3. Training management: Use a range of formal and informal courses, including customized AI-drafted learning materials, to keep your workers progressing

In addition, Deel HR, our truly global HRIS solution, is always included for free.

Ready to create a clear organizational structure for your employees? Request a free demo of our powerful platform today.