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Ask HN: Location based pay is killing my motivation, how do others handle it?

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Re: Ask HN: Location based pay is killing my motivation, how do others handle it?

#161

Post by opportune »

One major difference is that in some countries (many EU countries) payroll taxes are much higher than in the US, where most income taxes are paid by the individual. So while your quoted salary is lower, the cost to company difference is less stark - your country just makes you pay higher taxes.

Another difference is that tech companies are expanding into countries like yours precisely because it's cheaper to hire people. Not to be an asshole but you see this in the types of projects that cheaper countries get in large multinational tech companies compared to the major hubs too - less direct product work, more things like internal software, tooling, data/devops pipelines, etc.

Re: Ask HN: Location based pay is killing my motivation, how do others handle it?

#162

Post by rootusrootus »

withinboredom wrote: post #96
rootusrootus wrote: post #81

If I am hiring outside the US, I'm doing it to save money. I'm willing to accept the downsides -- schedule differences, language barriers, etc, in order to save money. Otherwise I would just hire someone in the US. So if a foreign dev were to tell me I had to pay the US rates, I'd pass. I think you should negotiate for as much as you can, but it is unrealistic to benchmark yourself against US employees of a US compan…

And what are you going to do if that dev moves to the US while working for you (such as on a partner visa)? Are you going to pay them more or fire them? I don’t work for less as an American Expat, I work for how much I’m worth (which is a lot more than local wages) and I live where I live because the money let’s my wife stay at home, in a nice house in a nice neighborhood instead of us both working our asses off just…

> I don’t work for less as an American Expat, I work for how much I’m worth (which is a lot more than local wages) and I live where I live because the money let’s my wife stay at home, in a nice house in a nice neighborhood instead of us both working our asses off just to have a decent house in a shitty neighborhood.

That is reasonable. But if you want to work on a schedule that is not the same as a US dev, then you are worth somewhat less to me. E.g. South America would be fine, India not so much.

> And what are you going to do if that dev moves to the US while working for you (such as on a partner visa)?

When we have devs come to the US on a visa, they are actually switching jobs to a US role. They don't come here unless we have an opening. Then they are able to compete as any other US candidate. It does happen periodically, but not too often.

Re: Ask HN: Location based pay is killing my motivation, how do others handle it?

#163

Post by layoric »

Panzer04 wrote: post #75
pyrodactyl wrote: post #55

Earlier quoted context omitted.

Its not a crazy conspiracy, I know it's pretty clear why it's being done. And I know I can't do anything about it other than look for new opportunities. But should location based pay be just accepted because that's the norm? There are variables that can't be used to do discriminate like age, gender, race, sexual orientation etc. We've accepted equal pay for equal work in these cases. Is it that far fetched that even…

You’re missing the point. Location based pay is not the norm, the norm is paying you as much as it would cost to find an equivalent replacement. That just happens to be location-dependant. It’s got nothing to do with discrimination, it’s purely about hiring for the lowest cost. They have to pay more in EU and US to get employees, and less wherever you live.

So if they quit, are you saying the company to refuse to hire a replacement from the US/EU due to some purely budget related limit? That is definitely not my experience working with a few remote first companies. They will try to find a suitable replacement in the relatively short period that is recruitment (1-3 months, depending on seniority). The cost difference for one employee is usually not big enough to worry about in the larger scheme of things.

The opportunity cost of not having that senior dev on board for more than 3 months is damaging for rest of the team and company goals/time lines. In the current market, my guess is that this person would be replaced with someone NOT in that location unless for some reason it is business critical to have someone in that area, which is almost never for software developers.

Re: Ask HN: Location based pay is killing my motivation, how do others handle it?

#164

Post by aristofun »

Your company is not your buddy. All these talks about cost of living adjustment is nothing but beautiful horse shit to sugarcoat the truth (below).

You’re essentially a tool they try to buy as cheap as possible.

Your job is to sell yourself as high as you can.

The good news is that both you and your company have freedom to choose and compete with other entities.

So the only way for you to fix motivation is not talking it through, but rather to learn winning in this free market game.

Re: Ask HN: Location based pay is killing my motivation, how do others handle it?

#165

Post by SanjayMehta »

Salaries are local.

Outsourced development and manufacturing are premised on this and other local factors such as government incentives and subsidies.

It is possible for contractors to earn equivalent hourly rates but remember then you don't get a monthly salary, and any time off comes out of your pocket.

Re: Ask HN: Location based pay is killing my motivation, how do others handle it?

#166

Post by mattdeboard »

therealdrag0 wrote: post #155
mattdeboard wrote: post #136

Earlier quoted context omitted.

Yes, because the workers would not be contributing labor to the company's output. To put it another way: Yes, zero exploitation of OP's labor is less than "some" exploitation of OP's labor. It clarifies things for me to replace "cheaper labor" with "more profitable labor". Why would a company refuse to hire more profitable labor? How could the company not having any relationship with OP exploit his labor more than hi…

The employee is welcome to work for a local company at local rates. It seems they prefer the colonizer? Is that exploitation any more than the US employee not getting paid 2x or 5 or 100 their current rate?

> It seems they prefer the colonizer?

Sure, because the foreign company exercises their access to capital to compete at a wage level that local companies can't compete with, but is still as low as possible to extract maximum value from the investment made by purchasing the worker's labor. Why do you think there's such inequality in economic opportunity, such that exploiting labor in this fashion is possible, in the first place?

> Is that exploitation any more than the US employee not getting paid 2x or 5 or 100 their current rate?

I'm not making any comparative assertions here. You seem to be making the case (by implication of your question) that in your opinion it's good for OP he's getting the opportunity to be exploited. And I'm just saying, it's exploitation. It is what it is.

Re: Ask HN: Location based pay is killing my motivation, how do others handle it?

#167

Post by systems_glitch »

gremlinsinc wrote: post #68

Easy solution, get a p.o. box in a higher cost of living location, and use that as your 'business' location, base your pay off that rate. Make sure it's somewhere the company doesn't have physical locations. Deceptive you say? Well, why do you even need to disclose where you live in the first place? Everything you need can be done remotely, again you can get a forwarding postal mail address from anywhere if they need…

So many small companies do this. I think over half of the companies I've done work for maintain a PO box and public phone number with a NYC ZIP/area code. None of them are in NYC, only one was in NY state. Why? Because NYC companies are more expensive!

Re: Ask HN: Location based pay is killing my motivation, how do others handle it?

#168

Post by opportune »

rootusrootus wrote: post #81

If I am hiring outside the US, I'm doing it to save money. I'm willing to accept the downsides -- schedule differences, language barriers, etc, in order to save money. Otherwise I would just hire someone in the US. So if a foreign dev were to tell me I had to pay the US rates, I'd pass. I think you should negotiate for as much as you can, but it is unrealistic to benchmark yourself against US employees of a US compan…

I agree with this in general but it depends on the individual. If I were looking to hire someone who was extremely smart/an expert on X I'd be focused more on their value:cost than location.

But for large tech companies that's not how you're hired - a body is needed to fill head count and the overlords determined that this particular position was better filled by a body in a cheaper country. Even if you do turn out to be very valuable to the company, the system is not set up to accomodate that scenario (and realistically, if you leave, the company can just hire another 5 people and hope to get another very valuable person among them).

Re: Ask HN: Location based pay is killing my motivation, how do others handle it?

#169

Post by jondeval »

I think there is a major competitive advantage here for small employers that know what they are doing. If you are running a small US/EU based company and you find someone great in an offshore local, then you can dramatically increase their loyalty, motivation, and potentially output with relatively modest and reasonable raises.

I fully understand that larger organizations make the transition to an MBA bean counter mindset that attempts to homogenize and commoditize employees, and I don't have any suggestions to change this status quo.

But small owner operated companies don't have to play by these rules. If you are leading a small technology company you should be well aware that there are huge differences in output between employees and your ability to actually know your people by name along with each of their strengths and weaknesses is information asymmetry that you have over the bigger competitors.

Re: Ask HN: Location based pay is killing my motivation, how do others handle it?

#170

Post by tradertef »

navjack27 wrote: post #138
pyrodactyl wrote: post #55

Earlier quoted context omitted.

Its not a crazy conspiracy, I know it's pretty clear why it's being done. And I know I can't do anything about it other than look for new opportunities. But should location based pay be just accepted because that's the norm? There are variables that can't be used to do discriminate like age, gender, race, sexual orientation etc. We've accepted equal pay for equal work in these cases. Is it that far fetched that even…

Imagine paying someone in my town where the median income is $39k and the median property value is $87k the same as someone in San Fran where the median income is $120k and the median property value is $1.15M. that would be unfair to everyone in my town who can't work remotely with a tech company that's in that area.

This doesn't make any sense. Your pay should be based on the value you provide to the company you work for.. Not based on whether it is fair to your neighbor or not.
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