I'm aware we were supposed to use an iterative macro here (and I will do shortly for the practice!) but I feel the following solution works just as well and is simpler. I got used the Append Fields tool to get do a cross join then used some very basic logic to massage the data into the right format. One issue was the analyst's man_id is 2 but the manager's is 1. I'd assumed these have to be in order of seniority so this is a bug in the input data. Obviously this could be corrected manually but I haven't here (as surely that defeats the purpose).
*My mistake... man_id is clearly the ID of their manager, not the 'paygrade' or 'level' of seniority. There's probably a way of working this out using the cross join method but I'm going to go with the iterative method as it's more interesting and efficient (I'd imagine!) anyway.