You're scrolling through job postings and you see two roles side by side. One says "Salary: $120,000." The other says "Compensation: $180,000." Are they equivalent? Without knowing what each number includes, you can't tell. That gap might represent base salary, performance commission, stock options, or some combination. And if you conflate them, you might chase a number that's inflated by a bonus you won't hit, or undervalue a role that pays less in base but more in equity.
Job postings use "salary," "compensation," "OTE," and "total comp" loosely, as if they're interchangeable. They're not. Here's how to break them down and read a pay number honestly.
Base Salary: The Guaranteed Floor
Base salary is the fixed amount you earn every year, regardless of performance or results. If a posting says "base: $90,000," you'll receive exactly that annually in paychecks, typically split biweekly. It doesn't fluctuate. You don't "earn" more or less based on hitting a goal. It's what's committed to in your offer letter in writing.
Base is the easiest number to compare across jobs because it's apples to apples. And because it's guaranteed, it's the only number you should rely on for budgeting rent, loans, or bills. Many postings that bury or omit the base are trying to make the overall package look better than the base alone would warrant.
OTE: On-Target Earnings, Not a Guarantee
OTE (on-target earnings) appears frequently in sales, customer success, recruiting, and other roles where pay includes commission or performance bonus. The formula is straightforward: base plus variable comp at 100 percent attainment equals OTE.
A typical example: $50,000 base plus $50,000 in commission at target, totaling a $100,000 OTE. The company is saying, "Hit your number and you'll earn $100,000." But "target" isn't "guaranteed." Whether you hit it depends on lead quality, territory size, target realism for someone new to the role, manager support, and whether the company itself hits its own revenue targets. Some people in the same role earn their OTE. Others earn 70 percent. Some exceed it.
The hidden complexity: Not all OTEs are equal. A $100,000 OTE at a company where the average rep hits 80 percent is more reliable than one where only the top 10 percent of reps hit it. You won't know that from the posting. And "ramped," for new hires, typically means three to six months at lower commission or a smaller territory before you start hitting your target. Year-one earnings are often well below OTE.
When comparing OTE roles: Ask the recruiter or hiring manager about average attainment rates, the ramp period for new hires, and whether the base alone is livable if you miss your target. Don't bet your financial security on hitting the bonus. If the base is low, pass on the role even if the OTE looks attractive.
Total Compensation: The Full Picture (and Its Traps)
Total compensation includes base salary, bonus or commission, equity (stock options or RSUs), and benefits (health insurance, 401k match, gym). For some roles, it also includes sign-on bonuses or relocation.
Total comp is supposed to show the real economic value of a job. But the math is tricky. If an offer says "Total comp: $300,000 including $100,000 in RSUs," that assumes the stock price holds steady. If the stock drops 30 percent, your equity is now worth $70,000, not $100,000. You can't predict this. Vesting adds another layer: if your RSUs vest over four years and you leave after one year, you forfeit three years of equity (though there are sometimes exceptions). Many offers throw in a sign-on bonus to artificially inflate year-one comp, since you're only vesting one-quarter of your equity in year one.
Benefits are also harder to value than they appear. A company covering 100 percent of health premiums versus 80 percent matters, but the dollar value depends on your family situation and health. A 401k match of 4 percent equals roughly $4,000 if your salary is $100,000, but only if you contribute enough to get the full match.
When comparing total comp: Focus on year-one cash (base plus sign-on bonus plus realistic bonus or commission). That's what you can count on. Review the equity vesting schedule and apply a conservative stock-price assumption. Talk to current employees about what they've actually earned, not what the offer letter said. Ask which benefits matter to you and what the actual dollar value is.
Why These Numbers Matter in Comparison
Consider two offers side by side:
Offer A: Base $120,000, bonus $20,000 at target, total $140,000.
Offer B: Base $100,000, equity $60,000 over four years, total $160,000.
Total comp makes B look 14 percent better. Base makes A look 20 percent better. They're different risk profiles: A is guaranteed income plus an earned bonus; B is guaranteed income plus unvested equity that you'll forfeit if you leave. They're not comparable on total comp alone.
Or take a posting that simply says "Compensation: $200,000" with no breakdown. Is that base? OTE? Total comp? Each interpretation changes the offer significantly. This ambiguity is often intentional. When a posting doesn't break down pay by category, the company wants you to imagine best-case scenarios, not do the math on what you'll actually receive.
How to Read a Pay Number Honestly
Ask for a full breakdown. If a recruiter doesn't say "base: $X, OTE: $Y, equity: $Z," ask. A good recruiter will provide these numbers. One who hedges or avoids the question is sending a signal that something isn't competitive.
Compare apples to apples. Base to base. OTE to OTE. If you're comparing total comp, make sure both numbers include the same categories.
Focus on year-one cash. What will you actually deposit in your bank account in the first 12 months? Base, plus sign-on bonus if there is one, plus realistic bonus or commission if it's guaranteed or highly likely. Everything else (equity, future benefits) is secondary to "can this cover my rent?"
Understand the target behind OTE. Ask what the quota or target is, how long the ramp is, and what average attainment looks like. A $100,000 OTE backed by a realistic target and 75 percent average attainment is worth more than a $150,000 OTE that almost no one hits.
Be conservative with equity. Don't assume the stock will appreciate. If equity is critical to your decision, talk to people who already work there about what they've actually earned.
Pay Transparency Matters
About 4 in 10 live tech postings do not show a salary we can read. Some omit it entirely. Others list a range so wide it's useless. This lack of transparency makes your job harder. When a posting doesn't show pay, ask early, before you've invested weeks in interviews. A company that refuses to discuss pay range upfront isn't worth your time.
How GoodJobsOnly helps with this
Sorting through pay terminology is part of your job search homework. GoodJobsOnly shows you what postings actually say about pay, and we distinguish between base and OTE rather than mashing them into one inflated number. Because pay competitiveness is core to whether a role is worth your time, we factor pay versus market into our assessment of job quality. That doesn't mean we guarantee your salary or predict what you'll earn. It means we're looking at the same pay data you are and forming an opinion about how a job's pay stacks up against similar roles at other companies. It's an algorithmic opinion, not a guarantee.