Interesting choice to invoke market value to argue that the salaries that the market has settled on for remote work are too low.

The market value of work isn't the amount of revenue that the work brings in. If you think you can capture the full value of the work you do for yourself, you're always free to work as a solo entrepreneur instead of working a traditional job. That's kind of an upper bound on what the company could pay you, but the market value of the work is based on the number of employees the company needs and the number of qualified employees they can find. Remote work floods the supply with lots more available workers than they can find in any one city, so salaries for those roles go down. That's not treating you like a child, it's just how a market works.

Not too long ago, I remember threads on HN where people were saying that $200k or $250k wasn't enough for a SF dev and using real estate prices and general cost of living as justification. You can't have it both ways - either your general cost of living is taken into account in your salary (location-based pay), or it's not. If it's not, get ready for a market where the average senior developer makes $90-110k/yr, total comp.

I'd argue that this isn't really what location based pay is worried about. In this case, you're being paid specifically be close to some location or collective building because your employer values that collectiveness. That's okay. That's the company communicating "we value the ability for you to be here, in person, with this group of people - so we're going to incentivize it".

The problem with location based pay is when an employer says, "You can work from anywhere you want, but we want to know where that is so we can pay you less". You provide them the same value from mid-city America as you do in rural America. They simply want to pay you less when they can.

No, you are compensated for how much someone doing the same work would demand.

Like the original comment said, most programmers probably need to read a book about negotiation so that they can clearly communicate their skills and why they are not easily replaceable. Once you're established as an unique professional with an unique skill mix, you'll be compensated for how much the team to replace you would cost.

A candidate can't ask for an obviously uncompetitive salary, but they can ask on the high end for what a company expects to pay for an employee.

I don’t understand why pepple keep repeating this. Obviously we are paid what they can get away with. We’re just trying to change what that is. If everyone starts accepting location based pay, we’ll be fucked in the long term.

Or, well. It’s strictly better for me if I get paid SF wages anywhere in the world.

There is, obviously, incredible incentive to defect. If you're going to demand 100% of SF wages, I can improve my lot by demanding 99%. Then the next SWE can undercut me at only 98%, and so on.

Setting aside that obviously, on an individual level, an employer will typically want to pay you as little as they can get away with, this isn't how location based pay works at a macro level.

Saying "You can work from anywhere you want, but we want to know where that is so we can pay you more" is an equally (in)valid statement since it's about pay distribution.

A high local real estate price is a reason you can't profitably work for less and its something you can profitably express to an employer if they will take it into account in order to access the local labor market.

A lower local real estate cost is a reason you could work for less not a reason you ought to want to.

You absolutely should try to have it both ways to the greatest extent possible because they are too.

I am not sold on full remote working for most companies. I am not even convinced the little covid experiment demonstrated anything, as companies still benefit from employees knowing each others from before the lockdown. Long term the effects in term of productivity, employee morale or culture may be quite different. A compromise is having more local offices, but even then, everywhere I saw it before, it creates a “them” vs “us” between offices, people feel remote from the centres of decision, etc.

But -- and I feel like I'm alone in this -- my personal observation is that even for teams that knew each other before full time WFH I've noticed the teams _mostly_ are not doing new and challenging projects. There's a ton of work and small iterating possible in any company, but I notice all the challenging projects have been punted - or are moving very slowly.

My personal conclusion is that remote work does not, in fact, work well, at least for some types of projects. I can totally see UI-heavy stuff working out, for example, but not embedded or high complexity projects.

I have become interested with the real value of software, and how getting rid of stupid high wages could be a great thing for the industry.

As an analogy, if a country has reasonably priced infrastructure workers (laymen and engineers) it can afford to build the infrastructure it's community needs. If you blow your annual budget building 6 miles of train line, you'll never have high speed rail. Real world example: Australia, one of the richest countries in the world, notoriously high infrastructure costs. While the rest of the world is speeding away with high speed rail, we could barely afford a two stop tram extension in the CBD.

Now have a think about all the software that doesn't get written because it's prohibitively expensive to make it, lots of boutique applications for specific needs, or local communities that need software to help with problems in their community. There are probably a lot of companies that could really do with an inhouse software team, but would never entertain the idea on account of the cost.

Also Australian workers are no doubt well paid compared with some, but compared with the U.S. or Western Europe? Taking into account cost of living etc.? Certainly engineers in Australia in general don't seem to be getting SV wages.

That being said, the original poster is a little bit off, as both Sydney and Melbourne have inner-city transport options and infrastructure that outcompete practically all American cities in that regard, and punches pretty damn well on a worldwide basis (behind only a few cities that are notable specifically because they are world leaders).

Cost of living allowance/adjustment (COLA) was a retention strategy originally designed to give workers being transferred overseas and to large metropolitan areas more money, not less. You should do some reading up on HR practices if you want them to stop taking advantage of you.

My simple counter was that "if I save 20% of my salary per month, I will have 4k in the end of the year. If I take an €60k (net) job in Frankfurt and again I save 20%, I will have 12k". Why would I 'sell myself short' for 8k of savings per year? It only made him angrier because my narrative did not match his sales-pitch. I never got to work for Amazon (or anyone else in Bratislava).

Location matters.

If you want €100k then don't look in Bratislava.

If you want a 'slow calm life' (away from the madness of London/Paris/etc.) go to Bratislava or Ljubljana and be happy with the €40k.

> You can't have it both ways..

No but people love to complain.

PS/Addition: it feels like "bait and switch". It's like hiring me in Bratislava, giving me a small (net) salary and ask me to work from London. I wouldn't accept that. The employee would also feel cheated the other way around. And with that said this is my favorite cities' cost comparison: https://www.numbeo.com/cost-of-living/comparison.jsp

Many IT companies in Bratislava hire local people for local salaries... and then make them travel to other countries exactly 49% of the year (so they still pay taxes locally); the remaining 51% of time working for a foreign client remotely from a local office.

My friend had a job where he had to fly to a Western country every Monday morning, and fly back home every Friday evening, to maximize the number of working days within that 49% of the year. (This way you can work abroad for 36 weeks a year, instead of "mere" 26.) And of course he had to spend 8 hours working each Monday or Friday, so he left home on Monday soon after midnight, and arrived home on Friday shortly before midnight, so he basically spent the whole weekend sleeping. (He already quit that job.)

If i live in a low COL area and i apply, why wouldn't i want the competitive advantage of being able to charge them half as much and make twice as much profit as my competition?

People outside the bay area can make a good living charging well below crazy SF rates.

This isn't even an argument to me. It's not even a discussion. Of course when you have a pool of talent, and that talent is competing for a single job, they will use every tool possible. If you can work for half the price of some SF guy paying massive SF rates, why wouldn't you use that tool?

Yea sure, i could make $200k a year - that would be neat i suppose, but it's insane imo. The number only exists because of SF specific problems. And i'm not in SF.

And thats exactly how a company should operate - maximize profit while minimizing cost. And conversly, as an individual, you should do the exact same, which is get paid as much as you can for your work (or do the minimum amount of work for the pay you get). When both of those strategies meet in the middle, you get a paid job position.

Agreed entirely. It depends on what specifically we're discussing. I often look at hiring.

> If Google cuts your salary 50% because you move to a cheaper area, maybe that doesn't make a difference to you but it is free profit for Google shareholders. It makes it more obvious to people that the amount they are paid and the amount of marginal profit they earn for the company is WILDLY incommensurate, even for over-compensated Silly Valley engineers, and would be even moreso if you move somewhere cheaper and take a pay cut.

I wouldn't work somewhere that did this for this very reason. But there's a huge difference to paying someone based on their finances, and negotiating hiring pay. I'm just talking about hiring pay being negotiable.

I feel like people saying "just move to a low COL area" have never actually lived and worked in a low COL.

If you lose your job or get fired, there's no one to back up that "half as much, x2 profit" unless you find remote work again, and then you're also at the mercy of whatever people feel they can get out of you. Without competing offers or local competition, you're at the mercy of the market.

People are underselling the competition that nuclei of talent can produce from top competing companies.

Also, people need to remember that "cost of living" is not actually one thing. It's not like I get a "living" bill once a year that I have to pay. Even in relatively cheap areas, there are some things that cost the same as or even more than they do in major metro areas. Don't do math based on some web-based COL calculator or even on housing prices and assume that it will apply across the board.

I have absolutely seen offers within the last six months where the candidate would be worse off financially despite living in a "cheap" place because the pay reduction was more than the all-in cost of living a similar lifestyle (yes, if you're willing to downgrade lifestyle you can offset this, but you can do the same thing in SF. Most people I've seen actually want to UPGRADE lifestyle with larger houses, more land, nicer neighborhoods, etc.).

Ok hold up in what world does $250k in SV suck? Median household income here is around $120k last I checked. Making more than double that cannot be described as sucking, come on.

I'll believe this only insofar as $120k in the Midwest means you are "set" in the sense that you can max out your retirement, buy a home, have nice cars, etc. and basically live on autopilot from a financial sense.

This type of housing setup that would cost $300k in, say Dallas, will cost $2.5 million on the peninsula. Between property taxes, mortgage insurance, interest, and principal payments and a jaw dropping $140k down payment, that is a monthly payment of $14k or so.

Your take-home after taxes on 250k in the bay is probably around 160k, or 13.3k a month. Whoops, no “American dream” home for you.

Then again I would describe most of the houses here as somewhere between a hovel and a shack in terms of build quality. But I’m getting used to it after 6 years.

I would agree if it weren’t for the fact that this is still a completely reasonable expectation in most of the rest of the country.

Of course it’s going to cost a crazy amount of money. It’s not even an option in Manhattan, but plenty of people would disagree it “sucks” there.

In Manhattan thats the expectation. You’re in a super dense area filled with high rises. Life is good for apartment dwelling.

In Mountain View, you’re in a suburb that’s mostly single family homes that you’re constantly reminded you won’t ever be able to afford.

> How is it reasonable in the least to expect a big house with a garage and a yard

That’s the lifestyle of the peninsula. It’s reasonable to expect the lifestyle you are constantly surrounded by. Back to the Manhattan analogy, $250k absolutely would not be considered good money if it could not afford you the ability to live like the average property owner.

The Bay Area is a stark contrast between the people lucky enough to have purchased 10+ years ago + some FAANGs and everyone else. Everyone else is stuck in a terrible apartment telling themselves stories about how they’ll get out after making their money or whatever.

It’s nice living in a walkable apartment with no car in Manhattan (or nyc in general). It’s dreary AF on the peninsula.

No, it's not. Should you be able to afford a home in Beverley Hills? Should you be able to afford a home in San Francisco itself? 40 years ago that was the norm.

Yes, it is. The norm in cities in the US until very recently was that you could get a middle class job, buy a small home, raise a family, etc. This phenomenon of only being able to lick the boots of the homeowners near the good jobs is relative new.

> able to afford a home in Beverley Hills

We’re talking about the entire Bay Area, not a specific suburb. Anywhere within an hour commute of Google HQ is like this.

> Should you be able to afford a home in San Francisco itself? 40 years ago that was the norm.

Yes. It was the norm. Then the nimby dickheads stepped in and pulled up the ladder behind them by blocking everything they could and pushed through a very favorable proposition to existing homeowners (prop 13).

Your opinion might be that it’s fine to block out an entire generation from the bay and rent seek. I personally think that’s a shitty drag on society propped up by government created housing scarcity.

If you're aiming for $50k/y in profit after all COL, your required pricing is different in SF than it is in rural America.

If you live in rural America and compete at hiring with SF people, it's your competitive advantage to keep the same profit as them but negotiate a lower price. This increases your relative value in the hiring process.

Sure, i _could_ keep the same SF rates, but then my competitive advantage may just be my skill. If i want more than skill alone, i could lower my rates.

I'm not making less profit. I'm competing to get a job.

That is how you negotiate when you’re struggling to find a job. By doing this you’re admitting that you’re not going to be as good as the high CoL candidate so you adjust your price to make your offer more attractive to the company. That’s a terrible position to put yourself in (but entirely understandable if you can’t get offers otherwise).

If you’ve passed the same bar and the company is truly fine with remote, there no reason to accept anything less than what they would pay a local. Speaking from experience in several tech companies in the bay, a proven remote employee is just as valuable as a local and getting decent software people is fucking hard.

It’s unlikely as a candidate that there is even any competition for the position you are filling (as in not multiple candidates that have passed the bar being picked over). Talking you into cost of living adjustments or whatever bullshit is just salary negotiation, not competition with other engineers.

Get multiple offers if you have to, but there is literally no reason a company willing to pay Bay Area salaries can’t pay that to a remote employee. Accepting less is just letting them convince you your labor isn’t as good as Bay Area SWE labor.

Yup. That's what i said.

If you see no reason to negotiate, why negotiate? Set your price at what your think your value is. Don't indulge COL requirements of another location.

> It’s unlikely as a candidate that there is even any competition for the position you are filling (as in not multiple candidates that have passed the bar being picked over). Talking you into cost of living adjustments or whatever bullshit is just salary negotiation, not competition with other engineers.

As someone who hires, i disagree. Every one of our hires has been a debate on expected output when compared to cost. But we're a fully remote company.

edit: Oh, and we're not flush with VC cash. We also can't afford any SF employees for this reason. We're much more willing to hire a junior engineer if their priced accordingly. Likewise, if we hired someone at $250k/y, we'd expect twice the output of him/her - and that's unlikely.

I don't get why this is controversial.

Just because someone is charging $200k doesn’t mean they are worth it.

Companies previously established artificial constraints such as colocation that forced higher salaries. If colocation is no longer a requirement, it’s only natural the associated premium is going away. That is, if you want the benefit of living in, say India, then you’ll also have to incur the cost of competing against someone like Ramanujan (famous mathematician) rather than whoever just happens to be within commuting distance of Mountain View.

You are competing on price instead of quality. I'd rather compete on talent and keep the money, thanks.

The era of $400k total comp software development is going to end someday and more accessible remote work is only going to hasten it.

Well, the same argument has been made before regarding offshoring and so far that hasn't seemed to have spurred any major declines in total compensation.

Yes, but things are different this time (famous last words, I know). Prior to COVID-19, offshoring was competing with the convenience of having everybody in the same physical space. Now, with every tech company currently having nearly all of their staff working from home, they are learning to make the equivalent of offshoring work; they have no choice in the matter if they want to continue operating. It's a small, small jump from there to outsourcing to low cost of living regions or even real offshoring.

I'm not sure I buy this when the vast majority of these CEOs have magnitudes more money than they could feasibly spend even if they used a flamethrower. Honestly I don't see tech becoming less useful/profitable in the future, quite the opposite. As long as these $400k employees are netting people higher up a lot more, it isn't going to stop. One could argue that there's still room to pay the employees even more. (and let's be real, most people aren't getting $400k tc)

The situation in the valley developed in the 90s and 00s, so that companies could be located close to their investors. That was a time when remote work tools sucked and work practices forced people to be in the same office as the founders, so it made lots of sense that the proximity to capital spiked rents and comp to match.

But now, post-pandemic, remote work is the norm. The founders can relocate to the valley because investment finance is largely a relationship game and those are still way better done in person, but there’s no longer any reason the technical team needs to be located near the founders or even each other.

There is huge disparity in engineering salaries — if you work for a smallish company in a rural area you’re probably making $80k/yr for doing the same job someone in the bay gets $175+ for. Ideally it will work the other way around though — the folks making $80k are much more likely to jump ship for a remote job that pays $125k than the folks making $175k are to jump to the same job.

Of course, if organize via collective bargaining we can likely push that even higher, so listen to your union organizers.

But I do agree with you, it's high risk and there's a lot of luck involved. And it's much more important to find a job that's a good fit for you.

When we think of SF software, we think of software created by a company whose core product is the software itself, especially when the end-users are individuals or other software companies.

This is quite a bit different than most software developed outside of the bay area. Most of it is either in-house stuff or industry-specific B2B stuff. In these situations, the software doesn't have to be pretty, it doesn't have to use cutting-edge tech to woo investors, resource utilization is much less important, and hell - it usually doesn't even have to scale. It just has to work. It just has to make someone's job incrementally better, and it'll be a success.

This software can be tremendously valuable, and creating it has its own unique challenges, but the job is indeed a bit different than software engineering in the bay, and the compensation is different as well.

And my current job quite often has multiple teams from multiple employers/agencies from multiple time zones - even being able to have key meetings with all hand present would massively speed up - we could have avoided so many problems and delivered things months quicker.

They’ve actually seen a huge increase in productivity by moving to a virtual model during the pandemic — exactly because nobody is wasting 2 hours of their day waiting on elevators or waiting for meetings to start. People have more autonomy to block off their day and there aren’t the distractions present in a normal open office.

If I were to informally poll all of the product development organizations I work with, I would expect to see at least 90% of folks want to maintain the remote workplace going forward. They’ll still probably go back to some level of in-person work later this year, but the difference is that remote will still probably be the default for most folks. I don’t think we’ll ever get back to a model that assumes all or even most of the team is located in the same room — it’s just too much better to do things this way.

Trying to get things done properly is very hard if we could have even kickoff meetings with every one in the room and have printed designs stuck to the wall

And frankly most of the dev projects I work on are globally distributed anyway, so you’re never getting everyone in the same room to begin with.

But many engineers can work in the Bay Area for 10 years to become a millionaire then move elsewhere, buy a house cash and retire early (or work a lower pay job if they feel like it).

This sounds good on paper, but what you’re saying is establish roots in one place and then rip them up (take your kids out of schools, away from their friends, leave your friends, hobbies, etc). 10 years isn’t exactly an in-n-out stint on an oil rig.

Raises tend to be percentage-based. The junior making 200k in SF may be worse off than the junior making 100k in Pittsburgh.

But the senior making 400k in SF is much better off than the senior making 200k in Pittsburgh.

Since Silicon valley is that one weird place where it takes five years for a junior to become a senior, taking that job in Pittsburgh is quite short-sighted.

You’re correct, but that’s not what’s happening here. Facebook isn’t paying remote workers uniformly less than in person workers. It is paying different amounts for different remote workers depending on where they live. That makes no sense given that, as you observe, there is a single national market for remote workers. The fact that Facebook can do that is an indicator that it either has market power in the employment market for programmers, or that we’re in an odd situation where the market hasn’t reached equilibrium.

No. If you have a monopoly on a skill/knowledge/certification/etc, then in theory you can extract rent from the business, potentially up to the profits of the business (well, profits less the returns required to cover risk of capital). The maximum you can earn is far more than the value you create.

However, what it does not justify is location-based pay. From the company's perspective, there is no significant difference between a remote worker in New York City or Birmingham, Alabama.

I think supply and demand is still a big part of the answer. By square mileage the potential locations where employees can live has grown by 200x by opening up to remote work anywhere in the US (napkin math, US is 3.8 million sq miles, bay area and tri-state area combined are ~20k sq miles). But obviously the number of available engineers hasn't expanded by nearly that much, engineers are much more concentrated in the areas where most of the jobs have been concentrated up until now. I.e. companies still can't afford to limit their supply to remote only, just as they increasingly can't afford to limit supply to bay area only.

Then there's also the perhaps more controversial issue of skill & experience. The most in-demand engineers are the people with experience at Google, FB, etc. and these people are concentrated in the places where these companies are. Ambitious people also have self-selected to live in these hot markets for years. You could argue that these proxy factors shouldn't matter and companies should be measuring skill directly, but as an industry we still haven't cracked that problem. So on average, a remote engineer in NYC probably is more valuable to most companies than one in Birmingham, Al. Like it or not, there's still a lot inertia to overcome here (and maybe even a little bit of validity to these patterns).

There are plenty of developers who speak great English in the EU, many natively in the UK and Australia and Canada.

Why are these not all getting heavily poached by SV?

Because SV value in-person developers, so have driven up the pay for developers in SV, but in Europe a mid-level developer is still on something like €40-50k.

The “external factors” you speak of are the market conditions in which the market operates. You can change the external factors and the market will rebalance to a new equalibrium but that doenst mean the market was wrong before and correct now.

In the end, employers are free to make whatever excuse they want to try to pay less, but I will respectfully decline to take a 50% pay cut to produce the same value for them :)

My friend who works remote makes just as much as I used to working in the office (when I was in industry). He's not getting "location-based" pay, so I'd say that "the market" has not unanimously decided on that quite yet.

- I have a family with children. Should I get paid more than an employee who lives alone? - I have a big house that has a large mortgage. Should I get paid more than an employee who lives in a cheap apartment? - I have purchased a yacht that requires maintenance. Should I get paid more than an employee who hasn't?

Sure, the last one is ridiculous, but honestly, they're _all_ ridiculous. The idea that your employer should be able to look at your expenses and judge which ones are valid and which ones aren't, and then adjust your pay "appropriately" is offensive on a deep level.

The language itself, "should I get paid" assumes a parental allowance relationship and we should get out of the habit of using it. "Get paid" is a day-labourers colloquialism. The form of the phrase itself defines you as the passive subject.

Bill for work, draw a salary, agree to compensation, accept consideration, negotiate a package, earn bonuses, settle invoices, sell services (not time), sell equity - do not "get paid" by anyone. It's a psychological impediment that keeps people poor.

Penniless immigrants come to the US and within one (at most 2) generations become the 1% exactly because they DON'T think the way you do.

Mindset is everything.

It truly is. I may have a passion for Alizé and Cristal and to afford that passion I may want to live in a rural setting. That’s my business. Who are these people to try and tell me that whether I live in SF or Nebraska, they’re only going to let me drink André?

If an employer has nothing to do with your lifestyle choices, then they won't pay for them. For a truly remote position, they won't pay extra if you life in NY/SF vs Nebraska.

However, I think the world hasn't adapted to that market economics yet, so in this time of transition people talk about location-based pay as a stopgap measure. Software development doesn't benefit from a centralized location, so in the future developers won't naturally live in big expensive cities and employers won't pay them wages that permit them to do so.

To be honest, I think the best thing would be for SW Devs to have a guild that aids in collective bargaining. Otherwise, the power balance will gradually tilt too far towards employers. Other professional jobs (e.g. medicine, law) have similar arrangements, and that's the only reason why pay can remain high in them.

Sort of like a worker’s union?

No one making these decisions actually has this idea. It's just more acceptable PR than "we're going to lower your pay because we think you will accept it because we think that you won't or you think you won't have better options."

Should you? No. Do you have to? Yes.

If you have a family of four, a yacht and a mortgage maybe you need to make - say - $200k/y. Cool. But what about some single guy with none of those things, he can work for $100k/y and make the same profit as you.

Are you saying he shouldn't use his competitive advantage over you to get hired?

This isn't about the employer. It's about the employee, and what their life allows them to work for.

So rather than compete in the job market based on your skill set and what value they bring to a company, you should instead focus on not starting a family and living as cheaply as possible in order to make yourself attractive to companies. I'm sure employers would love for you to center your life around making yourself as cheap to hire as possible, but from the point of view of the employee it sounds extremely unhealthy.

Maybe. I got into this market because i was able to apply at a much cheaper position, beating out other more skilled employees. I levered my lower pay to offset my lack of history in the market. Were there more skilled people applying? Definitely. Did they apply at a higher rate? Definitely.

Sure if you wanted to go to extremes you should live as cheaply as possible. But you could say that about anything. Instead, live how you want to live and expect to deal with that cost of living. You said it yourself, "skill set and what value they bring". What value you bring to a company is relative to what they pay you. If you cost $500k/y but your skillset is that of a junior engineer, do you honestly think your value is the same of a similar junior engineer working for $100k/y? Unlikely.

If you want to live in a city you are simply required to make more money than someone living in a rural environment. If i have a huge mortgage i can't work at walmart. I need to make more. These are all relative values based on COL, how much you spend, etc. This shouldn't be a controversial statement, in my view.

Mind you i'm very liberal. I believe in worker rights. But forcing everyone to be paid for insanely high COL SF rates seems bonkers. Absolute bonkers.

(off-topic) this reminds me of a job interview I had early in my career. The person interviewing me was one of the directors of the company and he asked me why I'd requested such a salary.

Initially I was thinking he'd want me to answer some bullshit about Bringing Value To The Company etc but he started probing about my personal life - do I have a wife/kids, what do I spent money on, how much is your rent, how much disposable income do you have and why do you want more.

Needless to say I wasn't impressed by this and decided to cut the interview short.

(I actually took the job despite this because I wanted to get on the internet train, and I don't regret it. Also, it took me a bit over a year to take over that manager's role and make X2.5 of the original lowball salary)

Except that it seems that there are a whole machine gun worth of bullets just in this HN thread.

The market value of your work depends, in no small part, on whether or not that work includes showing your face X days a week at an office in San Francisco.

However, that this not the argument these people are making. The argument I see time and again is that your compensation should be location-adjusted based on cost of living. And by making that argument, they are clearly saying you are—or are not—entitled to a certain degree of living, which is where it gets creepy, inappropriate and inevitably abusive.

And why do I say creepy? Because saying that a person does or does not deserve a certain lifestyle, and saying that they will or will not facilitate that lifestyle for you, crosses a boundary into your personal life that degrades you as an independent individual who is entitled to decide whether or not you do basic things like saving money. Instead of treating you like a person, they treat you and force you to conceive of yourself some sort of "lifestyle consumer." Sure, some people just have no leverage. But normalizing this way if thinking is going to lead us down an even worse labor path than we are on right now. Your employer is not your legal guardian.

Employees have no more reason to be concerned about the value of their work to employers than employers have to be concerned about the value of their pay to employees.

If you want to be logical about it the only thing that matters is the market. But both sides try to bring in irrelevant arguments in hopes of getting leverage in negotiations. Sometimes it even works!

There isn't one market. A remote SV developer should be able to command more if they can sell a connection to SV. Same for a FAANG company.. you can get paided more for being associated with a faang

Pay market rates. If you want people on location in SF, pay SF market rates. If you want people occasionally on location in SF, pay SF market rates. If you want people to travel rarely to SF pay local area rates to the nearest office the person lives by.

SF is neither the center of the universe nor where all the interesting problems/projects reside.

One change. For those you only rarely require to travel to any of your offices, pay the same regardless of where they live. All remote locations are the same as far as the company is concerned [1].

For a company with N offices, there are only N+1 locations as far as pay should go: the local rate in each of the N office's local area, paid to people who are required to be on location there more than rarely, and the rate for everyone else.

On those rare occasions when someone in the everyone else group is required to come to one of the offices, treat it like any other required business trip and the company pays for travel and lodging and food.

[1] to a first approximation. If the company needs a job to be done on a particular daily schedule, then there are two remote locations as far as the company is concerned: time zones where that schedule is reasonable, and everywhere else.

The point is that you as a company do not care where your remote workers are except perhaps they need to be in a timezone close to that of whichever office of yours they are working most closely with.

If you can pay remote workers what would be a good wage in El Paso or Tulsa or Boise and that is sufficient to get you enough good workers from such places to fill your needs, you don't care that it is not enough to get workers from Boston or Minneapolis or Chicago because you don't specifically need workers from Boston or Minneapolis or Chicago.

(i'm being ironic here, btw)

Say hi to Doc Brown for me, thanks.

You claim that you should be paid based on market value. You are probably speaking about the pre-covid market value.

But once you open up to full-remote working... The market broadens immensely.

Your "competitors" in the market are not bay-area people anymore. It's the whole US. If your company has branches in other countries too (think FAANGs) and the workforce was already spread across timezone then now most of the world is filled with potential competitors for your job.

And now with a huge supply of workers, your market value decreases a lot.

And to be 100% honest: as an european, if you (an american) think you're worth 250k and your employer is thinking of firing you and offering me 125k for your job... Well good luck with your next job search.

Agreed, not just American, anyone roughly in the same time zone. There are lots of well educated people in Peru/Chile/Brazil that would work 24hrs a day for a $25k salary.

i can’t understand this pov at all. unlike a child allowance, you can say no and court a different parent.

you are simply labor, and location based pay reflects this. the only ones complaining are those receiving less pay. it’s like when people complain (loudly) that “stealerships” add a markup above msrp for high demand cars, but the same people don’t complain about discounts from msrp for basic cars. if you don’t want the car at the offered price, move on!

Its not about the location, employer should always try maximize profit, if they can get the same service with lower expense, they should.

But, I am saying, that if you accept an offer that is based on what your employer thinks is an appropriate lifestyle for you, adjusted to the cost of living in your area, and not on the value of your work, that will immediately establish what I consider is a particularly inappropriate relationship between employer and employee. Of course this happens all the time for many reasons, but what we're seeing now is employers inventing and normalizing yet another, new tactic to deploy when trying to get you to accept less compensation. It's just another trick. But what's particularly insidious about this trick is that what they're doing is openly laying claim to your lifestyle by saying that: suppose you're a senior developer, you are entitled to organic groceries, whereas a junior developer is entitled to conventional produce, regardless of where you live, that's what you deserve. But that's wholly inappropriate: your compensation should depend on what you produce, and your lifestyle should be none of their business. If I want to move to Thailand or the middle of a field in Nebraska and save money, that's none of their business. There is no "objective" lifestyle that a senior developer should be entitled to. But that's this new trick they are trying to pull, and it's nothing short of disturbing and creepy.

The same way employee should use whatever 'tricks' at their disposal to get a higher pay.

For a buyer, that means a lower price. For the seller, that means a higher price.

Not a single other factor matters.

I keep repeating this on HN whenever a comp conversations come up. Unless lotsofpulp's comment resonates deeply with your bone marrow level intuition of what gets you paid, you're totally missing the point (and making bad choices.)

If we can remove location-based pay as a negotiation tactic, merely by creating social disapproval because its 'invasive', and the like then that's wonderful for us as as employees.

Why shouldn't we work together to hobble employers at the negotiation table? They have enough power as it is.

I have worked with two kinds of employees that are willing to accept lower pay.

- those moving for a better lifestyle who have earned and saved considerably more elsewhere. I call these “working retirees”.

- those who have family sending them money to subsidize their cost of living in an expensive city.

When looking at an individual employee's decisions, these policies don't seem to help the company. I think they only really make sense when thinking about populations, where people are less mobile and more fungible.

> that your remuneration is based on the lifestyle that they think is appropriate for you

Often, these schemes happen because it's employees who have lifestyle expectations. "I'd love to work for your company, but I'm not cutting my standard of living." And that's reasonable. The raw amount of money means way less to most people than what it means for their lives. And straight cash compensation is only one factor in picking a job.

The truth here is that the Internet has caused context collapse in far more than work. Labor markets used to be local. They still mostly are, but for those of us lucky enough to be able to work remotely, that's changing. That's going to have knock-on effects in other markets (housing, food, education, etc) for at least a couple of generations.

As we jointly work out the new normal, I think it's worth starting with the assumption that people are not all complete assholes. Yes, by all means let's watch out for worker exploitation; there's a lot of it. But from what I've seen, so many policies are just well-meaning people tinkering with things that they inherited. We can be firm about negotiating for fairness without assuming everybody's out to get us.

Just about all benefits offered by employers, from maternity leave to health care, function as allowances for particular purposes. They pay a variable amount based on the varying needs of a workforce.

One could even relabel the location-based-pay as a "rent supplement". If everyone get the same pay but those paying crazy high rents get extra to ameliorate this, it sound better.

Which still isn't saying I like this idea. I don't think pay should be able to be easily translated to benefits and I think only things that are unalterably unequal, like health care and maternity leave, should be doled out as benefits.

But I don't think one can make the argument that "allowance" type pay is inherently offensive. I mean, one allowance thing that's totally reasonable is when employees have to go to conferences for a work and the employer gives them an allowance for the incidental expenses they're incur.

Understand and negotiate based off the value you provide, and what you can bring to the business. Chances are, your local cost of living has very little to do with that.

No, I'm just saying sometimes employers can reasonably take employee costs into account - health care, maternity leave, day care, etc. Not here, I agree employers should not consider this. But I think saying employers should never take variable employee costs into account is an argument that's wrong, so making that absolutist argument won't help the case.

It’s all negotiations. If you think it’s worth taking a $10k paycut for a $5k (for the business)/$12k (as an individual) health plan, then it’s win-win.

If you take a $10k paycheck because you live in Nebraska (and nothing else), and the Company is in SF? That’s just bad negotiating.

If the company is in Nebraska and only pays $10k less and can get plenty of takers locally - then they won’t get many people from SF, and they’re probably fine with that.

You're really not doing the HN user stereotype of entitled valley types any favors using very personal ego-centred words such as "offensive".

Of course, since there is more demand than supply of qualified workers, remuneration rises above that minimum. But as long as an Indian developer is "glad" to do the same work as you for 1/4 pay...

Local cost of living, if everyone is working remotely, has no bearing on the value you provide your employer. Discussing location based pay in that environment is rather absurd, is it not?

The difference now is artificial constraints within countries around locale are loosening, meaning locals can play the same game (and take advantage of similar bid/ask spreads personally). IT work in India happened because while super hard to get started/get over the bar, the wage differential was huge (between what a viable candidate would accept, and what the company was willing to pay). Multinationals who could get over the bar to take advantage of it have reaped trillions.

For jobs that are fundamentally local, it is different (plumber for instance). The number of those jobs is decreasing over time, however.

This will likely result in a 'reverse brain drain' as long as conditions persist, with rural areas benefitting from smart and ambitious people no longer being forced to relocate to a city to benefit. They'll pump money into the local economy.

For people already remote, they'll have more competition and will need to continue to differentiate.

For those in cities, well - it's gonna be rough.

Long term, it's likely that center of gravity will shift back to the cities - physical distance does have beneficial effects, and at least when there isn't a pandemic, it tends to override the other issues with city life (competition for space means high rents, noise, etc.). It might take awhile though.

If you're aiming for low/mid-level (generic) employee, you're eventually going to have a hard time competing with someone who can survive on less. It has been what is causing a lot of the angst in the middle and lower class (especially in manufacturing jobs), as their labor is easy to outsource in many cases to cheaper places.