Definition
An employee whose salary exceeds the maximum of their pay range, typically marked with a red circle in compensation systems. They're earning more than their job is worth, usually grandfathered from a previous role, and won't see raises until the range catches up.
Example Usage
After the reorganization, several demoted executives became red-circled employees, maintaining their old salaries in lower-level positions.
Origin
Emerged from compensation administration practices in the mid-20th century when ranges were plotted on paper with colored markers
Fun Fact
The opposite is a 'green-circled employee' whose pay is below the minimum range, typically corrected immediately to avoid legal issues.
Source: Compensation structure and salary administration
Related Terms
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See “red-circled employee” in Corporate Speak, Gen-Z Slang, Pirate Speak, and more.
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