In a salary structure, which term is typically associated with compensation adjustments based on geographic location?

Geographical differential refers to the adjustments made to employees' compensation based on the geographic location in which they work. This concept recognizes that the cost of living varies significantly from one location to another, and therefore, salaries must be adjusted to attract and retain employees effectively in different areas.

When implementing a salary structure, organizations often consider these geographical differentials to ensure that employees receive equitable compensation that reflects local market conditions. This helps in addressing challenges such as attracting talent in high-cost areas while remaining competitive and fair across the organization.

The other terms do relate to aspects of a salary structure. "Grades" typically refers to levels or classifications within a job structure based on duties and responsibilities. "Zones" might refer to areas within a salary range rather than geographic location specifically. "Pay bands" generally define ranges of pay for specific job levels or categories but do not specifically indicate adjustments for varying geographic costs.