Build an Engineering Progression Framework: A Worked Example for a 40-Engineer EU Company

The starting point is a hypothetical German GmbH: about 70 workers, 40 of them engineers, six ad hoc titles, and pay negotiated per hire. The end point is a progression framework that also serves as the pay document. Its parts are a criteria matrix, one band per level, a one-page promotion packet, and placement letters. The matrix follows the four factors Article 4(4) sets as a minimum, plus collaboration and communication from its soft-skills clause. Part 1 settled that shape: four IC levels, an optional Staff level, and co-design with the works council.

Every criterion carries a number, so the calibration group, the engineer, and the works council read the same text. A placement letter, a promotion rationale, an appeal answer, and a consent request all cite it.

The order matters as much as the parts. The works council track opens before drafting, and the draft is back-tested against past decisions before any band is attached. Existing engineers are placed last, with their pay protected.

The Example Company#

Every property below belongs to a hypothetical company with no name and no history beyond this table.

Property	Value in the example	Why it matters
Legal entity	One German GmbH with one site (Betrieb)	The Works Constitution Act (BetrVG) applies; company, site, and employer headcounts coincide
Workers in total	About 70	Above 50, so no small-employer exemption; below 100, so no gap report under the directive
Engineers	40, in six product teams	Past part 1’s twenty-engineer threshold
Works council	Elected; no collective agreement on pay	Co-determination over the pay system (section 87(1) number 10 BetrVG); consent per placement (section 99)
Starting state	Six ad hoc titles, from Junior Developer to Principal Engineer; pay negotiated per hire; no written criteria	The inventory will find titles that do not match pay

Part 1 explains the two legal triggers in the works council row. Whether Germany has finished transposing the directive changes nothing here. The BetrVG steps apply either way, and the Article 6 duty arrives through the transposing law.

The Build Order#

Ten steps, each with an owner and an artifact. The order carries the argument: bands wait for the back-test, publication waits for the works agreement, and placement waits for publication.

The Head of Engineering and the People lead open the track with a short process agreement: members, steps, dates. The People team runs the inventory, one confidential row per engineer: title, pay, start date, last promotion, team, and the manager’s informal level. Section 80(2) BetrVG lets the works council inspect gross pay lists. In a council this size, the chair or a designated member does it, so plan for them to see the sheet. Two or three writers draft the criteria. All managers and a sample of engineers review the draft, and uninvolved managers run the back-test.

Opening the track at step 1 costs a slower start and shared drafting. In return, the agreement at step 7 is a signature on a text both sides already know. The step 9 consent requests then arrive without surprises. The failure mode is the working group becoming the only place engineers hear about the framework. Keep a separate feedback round with engineers who are not council members.

Levels and the Criteria Matrix#

Name the levels after the unit of scope each one owns, in the company’s own units. A level whose unit does not exist in the company stays unpublished.

Level	Title	Scope unit it owns	Published when
L1	Engineer I	Tasks someone else scoped	Always
L2	Engineer II	Features, end to end	Always
L3	Senior Engineer	One service or component	Always
L4	Lead Engineer (IC, no reports)	One team’s whole system	Always
L5	Staff Engineer (optional)	One cross-team technical area	When such an area exists and has no owner

Lead Engineer is an IC title. If the company also has team leads with reports, rename L4, for example to Senior Engineer II. The operating model for L5 is in The Solver Track.

Four rules govern the matrix.

• Every criterion has an ID: factor letter, level number, item number. S is skills, E effort, R responsibility, C collaboration and communication, W working conditions. S3.1 is the first skills criterion at Senior Engineer.
• The adjective test: two managers must be able to point to the same artifact (design document, pull request, incident review) as evidence. If they cannot, rewrite the cell.
• Criteria are cumulative: a level includes every level below it.
• Collaboration and communication are met at the target level, like skills, from Engineer II upward. Article 4(4) says “relevant soft skills shall not be undervalued”. CircleCI’s matrix is a precedent: technical skills were 20% of all competencies, and “the same proportion of skills is dedicated to feedback, communication, and collaboration”.

Numbering invites one objection. Monzo wrote that its rebuilt framework “didn’t try to codify exactly what someone needs to achieve”. Dropbox states that “This framework is not a promotion checklist for your role”. Here, numbered behaviours are evidence anchors: they say where to look. Calibration keeps the authority to overrule a literal reading, and every overrule is written down with the IDs it weighed. The cost is that each cell takes longer to write than an adjective and needs an evidence type.

Skills#

What the person designs, builds, and reviews. The evidence column names the artifact a packet links to. The other factor tables use the same artifact types.

Level	ID	Observable behaviour	Evidence
Engineer I	S1.1	Implements tasks scoped by someone else and merges them after review	Merged pull requests
	S1.2	Adds tests that fail without the change	Test diffs in those pull requests
Engineer II	S2.1	Splits a feature into tasks and delivers it without a design from someone else	Feature ticket and its task breakdown
	S2.2	Reviews teammates’ pull requests and finds defects before merge	Review comments that led to changes
Senior Engineer	S3.1	Writes design documents for data-model or public-API changes and revises them after review	Design documents with review history
	S3.2	Diagnoses production faults that cross service boundaries	Incident reviews naming the diagnosis
Lead Engineer	S4.1	Maintains the written technical direction for the team’s system: patterns to adopt, components to retire	Direction document and its change history
	S4.2	Reviews every design that changes the system’s boundaries	Design approvals
Staff Engineer	S5.1	Drives technical decisions that change how several teams build, such as shared libraries or data contracts	Decision records adopted by other teams
	S5.2	Reviews designs from other teams’ Lead Engineers	Review comments on other teams’ designs

Effort#

The complexity and sustained load of the work. Hours, availability, and response speed stay out, for the reasons part 1 gives.

Level	ID	Observable behaviour
Engineer I	E1.1	Works on tasks with a known solution path and written acceptance criteria
Engineer II	E2.1	Works on features where the solution path needs investigation before coding
Senior Engineer	E3.1	Works on problems with unclear requirements and settles them with product before building
	E3.2	Works on changes that span several components, where a fix in one breaks assumptions in another
Lead Engineer	E4.1	Balances the team’s competing workstreams (features, reliability, debt) and states the trade-off in planning
Staff Engineer	E5.1	Works on cross-team problems with no agreed problem statement, over more than one quarter

Responsibility#

Scope owned, in the company’s units.

Level	ID	Observable behaviour
Engineer I	R1.1	Owns assigned tasks until they are deployed
Engineer II	R2.1	Owns features from ticket to production, including rollout and follow-up fixes
Senior Engineer	R3.1	Owns one service or component: its backlog, reliability targets, and runbook
	R3.2	Leads delivery of a multi-week project inside the team
Lead Engineer	R4.1	Is accountable for the technical health of the team’s whole system
	R4.2	Acts as incident commander for incidents in the team’s system
Staff Engineer	R5.1	Is accountable for one cross-team technical area, such as authentication or the data pipeline

Collaboration and communication#

Same weight as skills from Engineer II upward. Communication as the Skill Gate for the Next Engineering Level argues that the gate arrives well before Staff.

Level	ID	Observable behaviour
Engineer I	C1.1	Asks for help with a specific question and what has already been tried
	C1.2	Writes pull-request descriptions a reviewer can follow without a call
Engineer II	C2.1	Explains the reason behind each review comment
	C2.2	Pairs with Engineer I colleagues on their tasks
Senior Engineer	C3.1	Mentors Engineer I and II colleagues on their current work
	C3.2	Explains technical trade-offs to product in writing, with options
Lead Engineer	C4.1	Resolves technical disagreements in the team and records the decision
	C4.2	Represents the team’s system in cross-team planning
Staff Engineer	C5.1	Builds agreement across teams on decisions none of them owns alone
	C5.2	Writes documents other teams adopt as their standard

Working conditions#

Described per level, paid by policy, and left out of promotion decisions.

Level	ID	Condition attached to the level
Engineer I	W1.1	Shadows the team’s on-call rota during onboarding, then joins as secondary
Engineer II	W2.1	Takes primary shifts on the team’s rota
Senior Engineer	W3.1	Primary on the rota and first escalation for the owned service
Lead Engineer	W4.1	On the rota; incident command is covered by R4.2
Staff Engineer	W5.1	Cross-team escalation point; joins a team rota only where staffing needs it

An on-call policy inside the works agreement pays one allowance per on-call week plus incident time worked outside hours, identical at every level. Nobody is promoted or held back for rota participation. Being on the rota is a working condition. Commanding an incident is a responsibility, assessed under R4.2. Indirect discrimination, in the directive, is “an apparently neutral provision, criterion or practice” that “would put persons of one sex at a particular disadvantage”. The exception is objective justification. A rota criterion is worth testing against that definition. Writing the W row closes the Article 4(4) gap part 1 describes. Review the allowance on its own schedule, because one set too low lets senior engineers drift off the rota.

Back-Testing Before Bands#

Run the draft against the company’s own history before step 6.

1. Collect every promotion, hire, and level-relevant pay decision from the last two review cycles, plus a sample of current engineers at each level.
2. A manager who was not involved applies the draft to the evidence available at the time, without seeing the outcome. They record the level and the IDs that decided it.
3. Classify each mismatch into one of three classes:
   • the criterion is wrong: rewrite it
   • the past decision was inconsistent: record it as a placement case
   • the evidence is missing: let it shape the packet format
4. Repeat until every mismatch has a class.

The back-test is done when the mismatches are explained, not when they are zero. CircleCI tested its rebuilt matrix with “trial performance reviews”, feedback workshops, and a focus group of engineers, managers, and HR. The back-test is the same move with the outcome hidden. The rows below are illustrative placeholders.

Case	Past outcome	Draft outcome	Criterion IDs that decided it	Mismatch class	Action
Promotion A	Senior Developer	Engineer II	R3.1 not evidenced	Past decision inconsistent	Placement case
Hire B	Developer	Engineer II	S2.1, C2.1	Match	None
Engineer C	Lead Developer	Senior Engineer	R4.1 scope does not exist in C’s team	Past decision inconsistent	Placement case
Promotion D	Senior Developer	Lead Engineer	S4.1 met, C4.1 met	Criterion wrong (too loose)	Rewrite the S3 to S4 boundary

The step can embarrass past decisions, and that is its value. The alternative is the same discovery after bands are announced. The trap is bending criteria until every past decision fits. An inconsistent past decision is a legitimate class.

One Band per Level#

Each level gets a midpoint, M1 to M5, and a band from the midpoint minus h to the midpoint plus h. The framework names the structure, and the compensation review sets the money. Set each midpoint from market data at a chosen percentile. Ravio’s band guide notes that “Most organisations begin by targeting the 50th percentile.” The ratio between adjacent midpoints comes from the data and will not be constant. State the width formula, because providers define spread differently. Ravio suggests 15 to 25 percent without saying whether that is total width or each side of the midpoint. Decide whether adjacent bands overlap. Overlap lets an experienced Engineer II earn more than a newly promoted Senior Engineer. Both choices are defensible once the rule is written.

Write the within-band progression rule. Article 6(1) covers “pay, pay levels and pay progression”, and recital 35 names “individual performance, skills development and seniority” as example criteria. For instance: position in band moves at the annual review, on evidence against the current level’s criteria. Market adjustments move the band and leave the position inside it. Say whether time in level counts. New hires enter the band of the level the interview evidence supports. Budget the raises to band minimum that placement will require while the band width is still a variable.

From Works Agreement to Placement#

Steps 7 to 9 produce the works agreement, the published framework, and the placement letters. The agreement covers more than the criteria:

• levels, criteria, and the band structure: co-determined under section 87(1) number 10 BetrVG, which covers pay principles and methods, including how pay is distributed across levels. The pay level itself and the total budget stay with the employer
• the promotion evidence format and calibration rules: general appraisal principles need consent under section 94(2)
• the on-call allowance and rota expectations, so that condition and pay sit in one text with the levels
• placement and each later promotion: each grouping or regrouping needs consent under section 99
• the change process: section 87(1) number 10 covers changes to pay methods as well as their introduction

Oppenhoff states that the co-determination procedure “must be concluded in advance”, which is why the track opens at step 1. If the two sides do not agree, section 87(2) sends the matter to a conciliation board (Einigungsstelle), whose ruling replaces the agreement. Budget time for it. Publish v1.0 and the placement process in the same week, then deliver placement letters within a set window. That way engineers read the criteria before their own placement letter.

Placement is where section 99 does its work, in companies with more than 20 eligible employees. The employer informs the works council before each grouping (Eingruppierung) or regrouping (Umgruppierung) and asks for consent. The Federal Labour Court defines grouping as placing an employee into a company pay scheme. It adds, in its own words, “Eine Umgruppierung ist jede Änderung dieser Einreihung”: any change to that placing is a regrouping. Moving 40 engineers into the new levels is therefore 40 consent requests. A refusal must reach the employer in writing, with reasons, within one week. Silence for one week after complete information counts as consent. A court can substitute consent after a refusal. Each placement therefore needs a written rationale citing criterion IDs.

Four outcomes cover the 40 letters. Where level and pay both fit, only the title changes. The letter cites the IDs that place the engineer. Pay below the band minimum rises to the minimum on a stated date. A new level below the current title leaves pay where it is. A contractual title, or one whose change reads as a demotion, changes only by agreement or a change notice. The framework uses agreement. Any other old title can stay as a personal title. The letter adds a development plan naming the IDs for the next level, with a review date. Pay above the band maximum is kept and red-circled: no band-based increases until the band catches up or the engineer is promoted. The letter states the protection, its review date, and the route to the matching level.

Do not cut pay through re-levelling. Pay fixed in an employment contract changes by agreement or through a change-notice dismissal (Änderungskündigung, section 2 KSchG). Neither belongs in a framework launch. Give every red circle a review date, and check the list by sex before launch. A protected premium that lands mostly on one sex is a pay difference the employer will have to explain. Article 18(1), and section 22 AGG in German law today, put the burden of proof on the employer. That applies once a worker establishes facts from which discrimination “may be presumed”. A UK case shows the time limit, though it is not German law. In Fearnon v Smurfit [2008] NICA 45, the Northern Ireland Court of Appeal ruled on that time limit. Red-circling stays a defence only while the employer can show it is still justified.

Appeals run beside the council’s refusal right. An engineer files a written appeal within four weeks of the letter. A panel that excludes the proposing manager answers in writing, citing criterion IDs. Pay protection, the four-week window, and the panel are policy choices of the example. Section 99 consent and the contract rules come from statute. Pay protection costs money, in raises to the band minimum and in red-circled premiums. The alternative costs contract changes and trust.

Promotions and Versioning#

The manager proposes a packet, and an engineer can ask for one. All managers plus at least one senior IC review every packet of the cycle in one calibration session. Calibration may overrule a literal reading, as the Monzo compass point in part 1 argues, and writes its rationale citing IDs. The example’s promotion rule: every target-level criterion is evidenced or listed as a known gap. Calibration promotes with at most one known gap, never in responsibility, because each level is defined by the scope it owns. For each gap, calibration also asks whether the engineer had the chance to show it. A missing chance is a manager action, recorded with the gap. Each promotion is a regrouping with its own section 99 consent request.

Section	Content	Limit
Header	Name, current and proposed level, framework version, period covered	One line
Skills	Target-level criterion IDs, each linked to artifacts	Both target-level IDs
Effort and responsibility	Target-level IDs with artifacts, per factor	One or two IDs each
Collaboration and communication	Target-level IDs with artifacts	Same count as skills
Working conditions	Not assessed; see the on-call policy	None
Known gaps	Target-level criteria not yet evidenced, stated by the proposer	Short list
Manager statement	Why now, in prose	150 words or fewer
Calibration outcome	Decision, IDs relied on, dissent recorded	Short paragraph
Works council	Date and outcome of the section 99 consent request	One line

The Big Tech packet in Career Levels in Tech Companies runs ten to fifteen pages with case studies. One page is enough here: each row links to artifacts, and calibration opens them. The weak point is thin evidence links, which the known-gaps row and calibration questions exist to catch.

Version every release. Dropbox’s public framework carries “Guideline Version: v2.9.1”, and Monzo wrote that it was “storing all our frameworks in GitHub”. Every placement and promotion records the version it was decided under. Keep a changelog, and agree in the works agreement which classes of change need a new consent round. Schedule the first review after a fixed period of use.

Pitfalls When Building#

Adjective criteria. Strong ownership cannot be cited. Apply the adjective test and keep one behaviour per cell.

Calibrating without a back-test. The first calibration then doubles as the test, with bands already announced.

Bringing a finished framework to the works council. A finished draft reverses the order and risks a conciliation board at the end.

Cutting pay or contractual titles at placement. Protect pay, time-limit red circles, and agree title changes or keep personal titles.

On-call participation as a promotion criterion. Pay it through the flat allowance and keep it in the W row.

Adapting the Example#

The example is the default build. Change it only where the table names your situation.

Your situation	Change to the example
No works council	Steps 1 and 7 become an engineer feedback round; keep publication, placement letters, and appeals.
A collective agreement covers pay	Map the levels onto its pay groups. Section 87(1) yields to a collective agreement that settles the matter; section 99 grouping still applies.
No cross-team technical area without an owner	Do not publish L5.
People managers exist	Open a manager track, built separately.
Under 50 workers	National law may exempt the pay-progression part of Article 6(1). Write the criteria anyway; the levels still decide pay.
Under about 20 engineers	Part 1’s override: a role expectations document.
Employer in the Netherlands	Consent step under WOR article 27(1)(c); the German placement mechanics above do not transfer.

The default holds for a German employer past roughly twenty engineers with a works council and no collective agreement on pay. Elsewhere in the EU, keep the build and swap in the national consent step. The table names the overrides, and each keeps the criteria, the placement letters, and the appeal route. The first concrete action is the same in every case: open the works council conversation, or the engineer feedback round, and run the inventory.

References#

• Directive (EU) 2023/970 on pay transparency (EUR-Lex) (opens in new tab) - Full text, including the Article 3 definition of indirect discrimination, the Article 4(4) factors, Article 6(1) on pay-progression criteria, Article 18 on the burden of proof, and recital 35.
• Section 87 Betriebsverfassungsgesetz (gesetze-im-internet.de) (opens in new tab) - Works council co-determination over pay principles and pay methods, and the conciliation board when no agreement is reached.
• Section 94 Betriebsverfassungsgesetz (gesetze-im-internet.de) (opens in new tab) - Works council consent for general appraisal principles.
• Section 99 Betriebsverfassungsgesetz (gesetze-im-internet.de) (opens in new tab) - Works council consent for grouping and regrouping individual employees, refusal grounds, the one-week deadline, and court substitution.
• Section 80 Betriebsverfassungsgesetz (gesetze-im-internet.de) (opens in new tab) - The works council’s right to inspect gross pay lists.
• Section 2 Kündigungsschutzgesetz (gesetze-im-internet.de) (opens in new tab) - The change-notice dismissal, the route for changing contractual terms without the employee’s agreement.
• BAG, 25 November 2025, 1 ABR 43/24 (Bundesarbeitsgericht) (opens in new tab) - Federal Labour Court decision defining grouping and regrouping under section 99.
• Job architecture: the key to modern HR work and legally compliant remuneration (Oppenhoff) (opens in new tab) - German law firm analysis of co-determination over job levels and of when a title change amounts to a demotion.
• Why we re-designed our engineering career paths at CircleCI (opens in new tab) - How CircleCI rebuilt its competency matrix, weighted communication equal to technical skill, and tested it with trial reviews and a focus group.
• Introducing progression.monzo.com (Monzo) (opens in new tab) - Why Monzo published its progression frameworks and kept them in version control.
• Lessons from implementing progression frameworks at scale (Monzo) (opens in new tab) - How a published framework drifted into a checklist and why the rebuild stopped short of codifying every achievement.
• Dropbox Engineering Career Framework (opens in new tab) - A versioned public engineering framework, framed as guidance rather than a promotion checklist.
• How to create salary bands (Ravio) (opens in new tab) - A compensation platform’s guide to setting band midpoints and range spread from market data.
• Red is the colour: Fearnon v Smurfit (Thompsons Solicitors) (opens in new tab) - Summary of a Northern Ireland Court of Appeal ruling that red-circling justifies a pay difference only for a limited time.
• Fearnon v Smurfit [2008] NICA 45 (Judiciary NI) (opens in new tab) - The full Northern Ireland Court of Appeal judgment on time-limited red-circling.