Fatima likely gets promoted, and you get transparency into paths to become someone like Fatima. In the case of Emily who toils away tirelessly holding up the backbone of the company, but isn't as visible as Fatima, now Emily has a clear path to advocate for higher compensation and if the company decides she isn't worth it, she can leave and that company will immediately feel the pain.
I don't really follow the logic that this pushes salaries to the bottom of the bands. Companies want to push them to the bottom, employees want to be at the top, if in a single instance a company and employee can't agree there's a more transparent market for the employee to explore. If they apply for jobs in a certain band and have zero success, they will need to adjust their expectations to find a job at all and should search out lower-bands or improve as an asset or be out of the job entirely.
Fatima likely gets promoted, and you get transparency into paths to become someone like Fatima. In the case of Emily who toils away tirelessly holding up the backbone of the company, but isn't as visible as Fatima, now Emily has a clear path to advocate for higher compensation and if the company decides she isn't worth it, she can leave and that company will immediately feel the pain.
I don't really follow the logic that this pushes salaries to the bottom of the bands. Companies want to push them to the bottom, employees want to be at the top, if in a single instance a company and employee can't agree there's a more transparent market for the employee to explore. If they apply for jobs in a certain band and have zero success, they will need to adjust their expectations to find a job at all and should search out lower-bands or improve as an asset or be out of the job entirely.