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2026 State of Pay and Compensation Practices

HR thinks pay is fair.
Employees aren’t so
sure.

Each year, Salary.com conducts the Pay Practices & Compensation Strategy Survey to capture the current state of compensation management. The results help practitioners benchmark their programs, evaluate internal HR strategies, and identify opportunities for improvement. All submissions are rigorously audited to ensure accurate, high-quality insights.

Salary.com has conducted the Pay Practices & Compensation Strategy Survey for years. This year, for the first time, we turned the results into something more: a full narrative report that goes beyond the data to examine what it means, why it matters, and what HR and compensation professionals can do about it.

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Rigorous methods power high-quality data

525

Participating organizations

13

Industries across public and private sectors

16

U.S. region and sub-regions represented

57

Days in field, November to December 2025

What’s Inside

Insights from the 2025-2026
Pay Practices Survey

The confidence gap

HR believes pay is fair. Employees aren't so sure. We examined the structural reasons behind that disconnect — and why communication alone won't fix it

A missing foundation

Only half of organizations have a formal job architecture in place. Without it, pay decisions can't be explained, defended, or scaled — no matter how sound the underlying analysis.

A clear path forward

Closing the gap requires more than better messaging. This report offers evidence-backed recommendations in the order they need to happen — foundation first, communication second.

2026 State of Pay and Compensation Practices

The work is being
done. Why doesn't
it feel that way?

HR professionals manage compensation with market data, pay equity analyses, documented philosophies, and performance frameworks. But when asked if employees see pay as fair, confidence drops sharply. Nearly 75% of HR professionals believe employees are paid fairly, but only 44% think employees actually feel that way.

This 31-point gap signals more than a communication problem. This report examines where the breakdown happens and why organizations can't afford to wait to fix it.

What’s inside:

  • The three compounding failures behind the confidence gap
  • The manager training gap that's leaving pay conversations to chance
  • How getting by without job architecture isn't the same as getting pay right
  • Industry and regional variation — where the gap is widest and why
  • A sequenced set of recommendations for closing the distance between effort and trust

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"You cannot communicate what you haven't built. And you cannot build trust in pay when the people closest to employees aren't equipped to have the conversation."

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