1.as far as my knowledge is concern, Job band would work with pyramid structure efficiently.
2. Out of my experience in developing the similar process, i would suggest first you have to work on steamlining existing employee skills and level/designation. Once you get them all on a matrix then work out on how many levels you have with existing employees which could give you an idea of requirements in band structure. Further develop an approach for band level structure aligning each existing level fit into it. This way, you could justify maximum employees role and employment level with new process.
3. If the organisation is following the employment policy where it explains the employee max. age for services with organisation/retirement age, and said aged force fall into that bracket then you cann't bring them into structure. For that it always better to keep them as consultants with same remunaration structure keeping a renewal option in agreement. This is practiced by most of the organisations as services extension of their retired employees whom the company would like retain their services for further period.
Thanks & regards,
6th November 2009 From India, Hyderabad