See below image for the Pay band and grade pay system diagram. Salary bands (or pay ranges) are how you define the target pay for employees within job grades. For each Level, a company should decide the low-end and high-end of the pay that level will command. Salary bands help when making offers, retaining employees, and planning for future growth.
Broadbanding. Broadbanding is similar to a pay grade system, except all jobs in a particular category are assigned a specific pay category. For example, everyone working in customer service, or all administrative assistants (regardless of department), are paid within the same general band.
Pay grades work by using preset factors to determine the amount of money someone earns at their job. These factors inform the structure of steps and levels within company compensation charts. The charts show job titles and the exact salary or salary range for each position.