Dear Jennifer,
The management is based on roles and responsibilities, which further determines the designations. For example, Manager HR in my organization is at the middle level, but VP - HR is in the top management. Even though there is no person in between these two designations, ultimately, the manager is going to get promoted afterwards as VP.
Normally, the organization's founder members, Directors (or Board of Directors), decide what the hierarchy in the organization shall be, and levels of employees (i.e., designations) are created.
If there is a problem, then HR interventions are essential depending on how powerful HR is. But most of the time, such levels are declared through the HR manual; hence, it is one of the most essential documents.
Kindly revert back if it is confusing.
Regards,
Shailendra