Ask HN: Should a remote employee’s salary be tied to their physical location? • Hacker News Board

Re: Ask HN: Should a remote employee’s salary be tied to their physical location?

#41

Post by [deleted] » Thu, Jul 23, 2020, 3:56 PM UTC

cameronbrown wrote: post #31

R0b0t1 wrote: post #7

No. Scaling income with CoL is just subsidizing the housing costs of people who want to live in more desirable locations. If someone wants to spend part of their compensation on living in a nice area, fine. But if someone else would rather take that compensation and live in a lower CoL area then let them.

But we're not paid by CoL, rather, the job market. If I move to a very small but expensive village, I'm not going to get paid more than being in London. Silicon Valley is just a weird edge case where there's so much talent in one place that it's affecting CoL. Regardless, there's always going to be a premium on in-person talent.

[deleted]

Re: Ask HN: Should a remote employee’s salary be tied to their physical location?

#42

Post by jdm2212 » Thu, Jul 23, 2020, 3:57 PM UTC

screye wrote: post #21

At a practical level, the industry will pay you the least amount of money for which you will accept the offer. In SF/Seattle, if they do not add the COL multiplier, your wages are low enough, that you might reject the offer. On the other hand, it is quite unlikely for a person to able to find another competitive offer, even if their salary is significantly lower than their colleague who make less. At an ideological l…

> In SF/Seattle, if they do not add the COL multiplier, your wages are low enough, that you might reject the offer.

That's not quite it. In SF/Seattle, you'll have either high-paying opportunities you can take instead if you're in software.

Plenty of people who aren't in software live in SF/Seattle and accept very low pay despite the high COL.

Re: Ask HN: Should a remote employee’s salary be tied to their physical location?

#43

Post by p0llard » Thu, Jul 23, 2020, 3:57 PM UTC

vbtemp wrote: post #11

I don't think anyone knows the right answer. Try it. Maybe they'll stick around. Maybe they'll stick around and be disgruntled. Maybe they'll leave and find another job that isn't trying to cut their pay Just let it happen and see what the attractor becomes for this large, dynamical system.

> Just let it happen and see what the attractor becomes for this large, dynamical system.

I think the problem with this stance is that "this large, dynamical system" actually determines whether people have food to eat. Playing experiments with the labour market is extremely unethical in my opinion.

Re: Ask HN: Should a remote employee’s salary be tied to their physical location?

#44

Post by chrisco255 » Thu, Jul 23, 2020, 3:57 PM UTC

In my company, we only have a few U.S.-based regions that more or less amount to SF, NYC, and the rest of the U.S. for salary adjustment. There is a base rate that stays the same regardless of location and then there is a market adjustment for those special cases. In my experience, the base salary is high enough where you could comfortably live in 90+% of the country and feel good about your comp.

Re: Ask HN: Should a remote employee’s salary be tied to their physical location?

#45

Post by winter_blue » Thu, Jul 23, 2020, 3:58 PM UTC

screye wrote: post #21

At a practical level, the industry will pay you the least amount of money for which you will accept the offer. In SF/Seattle, if they do not add the COL multiplier, your wages are low enough, that you might reject the offer. On the other hand, it is quite unlikely for a person to able to find another competitive offer, even if their salary is significantly lower than their colleague who make less. At an ideological l…

> I do not believe every talented European is 40% as capable as the average developer in the US. I do not believe that the same software engineer that made $10k in India, suddenly brings 10x as much value due to a 1 year masters, once they move to the US.

Exactly.

The salaries in some countries (e.g. India) are so low that it befuddles me. In smaller cities in India, software engineers actually make closer to around $4K a year, and new grads with no experience start at around $2.5K a year.

Compare that to the new grad pay rate of $180K+ at Google. Also, a close friend of mine at Google makes over $400K.

In some cases, the pay gap is literally 100X. E.g. in the US, it's $400K, and in India, it's $4K.

Why?

This pay gap makes no sense.

And, you're right. As soon as the same dev from India comes over to the US (and gets a Master's or directly comes on an H1B), their pay goes from $4K to $200K. (Another friend of mine moved here from India, and is making over $200K now.)

Why are salaries so far apart, even with all the tech we have today? Doing remote work over the Internet is so easy.

Makes no sense..

Re: Ask HN: Should a remote employee’s salary be tied to their physical location?

#46

Post by nell » Thu, Jul 23, 2020, 3:58 PM UTC

What if we invert this.

Assume the company pays the same irrespective of location.

Should an employee in SF or NY have a lower standard of living compared to an engineer who lives in a low COL area?

Re: Ask HN: Should a remote employee’s salary be tied to their physical location?

#47

Post by bradstewart » Thu, Jul 23, 2020, 3:58 PM UTC

bboygravity wrote: post #32

newsbinator wrote: post #3

Yes, and it should also be tied to their spouse's income, their sex, gender, age, and skin color, to keep things fair. Perhaps their sibling's/ancestor's income too. Make sure you account for all these factors to keep things equal. But if you're not able to account for all these factors, why not determine what an employee at a given level is worth to the company, and pay that amount to anybody who can successfully co…

> But if you're not able to account for all these factors, why not determine what an employee at a given level is worth to the company, and pay that amount to anybody who can successfully communicate & do the work, regardless of their circumstances or physical attributes? Sounds good to me. I'd be a retired millionaire at age 30 something if any of the companies I've worked for (remotely or otherwise) followed that l…

> I'd be a retired millionaire at age 30 something

How do you know what value the companies would assign to those factors?

Re: Ask HN: Should a remote employee’s salary be tied to their physical location?

#48

Post by graerg » Thu, Jul 23, 2020, 4:00 PM UTC

SketchySeaBeast wrote: post #8

I see the point of taxes being raised, so that's fair, but really I'd expect that, before taxes and other required benefits and deductions, the salary being offered should be the same. I can't see how one could reasonably rationalize that one worker is delivering less value to the company simply because they live somewhere different than the other.

>I can't see how one could reasonably rationalize that one worker is delivering less value to the company simply because they live somewhere different than the other.

I can definitely _see_ how one could make that argument. In some cases there is absolutely value that comes from in-person interaction. I'd argue it's far less than the salary difference between someone in Little Rock, AR and the Bay Area, though.

If an employer wants to make the case that there's value to in-person interaction, I don't think that's particularly outlandish, and it forces them to put a number on how much they value those interactions, which can then be benchmarked and tested.

Re: Ask HN: Should a remote employee’s salary be tied to their physical location?

#49

Post by alextheparrot » Thu, Jul 23, 2020, 4:00 PM UTC

simmons wrote: post #15

I think the relationship of geography to salary is going to be dictated by the biggest factors in all pricing -- supply and demand. Cost of living adjustments are really just a proxy for acknowledging that a prospective remote worker in Des Moines will have fewer local opportunities (lower demand) than a similar worker in New York, and so will be in a less favorable negotiating position. If remote work continues to g…

Wouldn’t this mode breakdown when more than two companies want a given remote employee? Presumably companies paying Bay Area salaries and still making healthy profits means that they can afford to pay high salaries irrespective for talent.

This seems to be true insofar as companies can’t collude, either implicitly or explicitly, to suppress remote wages.

Re: Ask HN: Should a remote employee’s salary be tied to their physical location?

#50

Post by Nasrudith » Thu, Jul 23, 2020, 4:00 PM UTC

Is the location or nationality relevant to the job location? Maybe it has some different overhead, regulations, better access to customers, internet access/lower latency which could affect the actual value of the employee depending on location. when it matters then it may make sense to care about it enough to pay a premium for high CoL if it is linked to something you want or a lower rate if other features make them less desirable.

If not then it is a cargo-culted antipattern because of the deadly words "That is always the way it was done." You would fundamentally wind up squandering money and talent by overpaying high CoL without the benefits of the location and losing comparable talents from a low CoL by showing them you don't value them.