Benchmarking is the process of aligning Buffer’s roles to comparable roles found in the labor market in order to obtain appropriate pay ranges. We refer to this data as Market Data and we filter on comparable company size (post money valuation), and location (SF) to align the market data to companies of a similar stage to our own.
When we “re-benchmark” we are pulling an updated data set into our Market Data sheet to see the adjustments the market is making in paying for roles. Using market data is one of The components of the Salary System. By having this as a distinct component, it allows us to refresh the data and point our Buffer Benchmarks spreadsheet to entirely new data, without changing other components. This is one of the significant upgrades to maintainability and readability of our Salary System.
When we bring in new market data, many salaries may have shifted in the market and our existing salaries may sit at entirely new Percentiles. In the case that the market has shifted downwards, we will aim to maintain those salaries at a similar level by increasing the percentile we use for that area. In the case where the market has shifted upwards, we will typically see a salary increase for people in the role. If it shifts significantly upwards, we may lower the percentile we are utilizing for our Buffer Benchmarks to reduce the upwards and downwards swings and create more stability in salaries, however we would still expect salary increases for team members in those roles.
We will pull in updated benchmarks on a quarterly basis in order to monitor trends in the market. We will adjust underlying Buffer Benchmarks (and salaries) every 6 months to balance staying up to date with the market alongside financial predictability for the company and team members.