If the employees move away rent goes down, so does demand for their properties.. so yeaaaaaaaaaaaaaaaah

5 -> 0 is a pay cut based on where you live.

5 -> 3 is not a pay cut as you're still working out of the same office.

If I were to go fully remote, I would take a pay cut ... but it would be almost identical to my commuting costs, once you account for rail fair, parking, vehicle mileage, taxes, snacks, etc.

I don't know how representative my case is, but the pay cut ends up being a non-factor in my decision whether or not to apply for full remote.

If this were indeed the reason for the salary adjustment, it wouldn't matter whether an employee was moving to Santa Cruz, San Mateo, or San Salvador. Either way they're remote, and unless one city has markedly different internet bandwidth, the value that a given employee delivers from any remote location should be the same.

Next time I hear someone making this argument, I'm calling BS. It's a bald-faced attempt for the company to capture value which rightfully belongs to the employee.

Only the horribly uninformed would ever make such a bad faith argument. You've never been paid based on your "value" but rather what it takes to keep you as an employee. The company only wants to pay you enough to keep you and if you move some place cheap well they don't need to offer as much.

I think that depends what your other options are. It might work if everyone in the industry offers you less based on where you live, which is almost collusion in my opinion.

Nevertheless, it's one that I've heard repeated quite often.