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For reference, GitLab are fully remote and publish their rationale [0] for paying regionally-adjusted salaries. Some of the arguments I don't really buy (for e

For reference, GitLab are fully remote and publish their rationale [0] for paying regionally-adjusted salaries. Some of the arguments I don't really buy (for example, I don't think you need to hire anyone from very high cost of living areas to build a world-class engineering org at GitLab's scale) and others (e.g., the golden handcuffs argument) I think are just a consequence of fully remote teams currently being rare. But it's still interesting to see their rationale. [0] https://about.gitlab.com/handbook/total-rewards/compensation/#paying-local-rates https://about.gitlab.com/handbook/total-rewards/compensation...

kube-system 6y ago
This isn't anything unique to remote companies. This has been standard practice for a very long time at companies with a presence in multiple locations, for the same reasons.
- tfehring 6y ago
  True, but I'm not sure that's equivalent. A company that employs onsite employees in a high cost of living area is demanding that they pay higher rent as a condition of employment and should bear the associated cost. It may still make sense for the company to bear that cost even if it's solely the employee's choice to live in a high cost of living area (e.g., for the reasons GitLab mention), but it's much fuzzier for remote employees than for onsite employees.
  - kube-system 6y ago
    I don't think companies have ever done COL adjustments out of altruism. It's because of market effects. If you pay Kansas rates for an employee in NYC, you're not going to get qualified candidates. This doesn't make a difference if the employee is driving to an office or not. Both remote and and onsite employees live somewhere. When you hire someone in NYC remotely, you're also competing with employers onsite in NYC, paying NYC rates. If there's anything that results from the shift to remote, it's going to be that companies hire fewer people in high COL locations.
betaby 6y ago
At the same time, GitLab services are NOT priced per region. Neither cost of the IPhone or Telsa is discounted in the region of FarmVille, Nowhere.
- kube-system 6y ago
  The price of products does often vary between regions when their is a regional explanation for the difference in price. iPhones and Teslas are priced differently in different locations, as are many many other products and services.
  - betaby 6y ago
    Iphones and Teslas indeed priced differently, most of the time they cost more in the places with lower purchasing power. I.e. compare cost of Iphone in Eastern Europe and US.
    - kube-system 6y ago
      It's the same thing, "COL adjustment" is just phrased from a different viewpoint. Both are simply regional adjustments for the price of a resource. That resource could be a product, or it could be labor.
      - betaby 6y ago
        That's kind of my point - there is no 'universally cheaper' place. However on every discussion high salaries are explained as a result of higher rent. Yet no one would apply the same logic for other things, like in Easter Europe cars are expensive - here is your car price adjusted salary.
        kube-system 6y ago
        Transportation costs are typically factored into COL calculations. Rent is the #1 thing people bring up because housing is by far the largest component of COL expenses for the vast majority of people on the planet.

kube-system 6y ago

This isn't anything unique to remote companies. This has been standard practice for a very long time at companies with a presence in multiple locations, for the same reasons.

tfehring 6y ago
True, but I'm not sure that's equivalent. A company that employs onsite employees in a high cost of living area is demanding that they pay higher rent as a condition of employment and should bear the associated cost. It may still make sense for the company to bear that cost even if it's solely the employee's choice to live in a high cost of living area (e.g., for the reasons GitLab mention), but it's much fuzzier for remote employees than for onsite employees.
- kube-system 6y ago
  I don't think companies have ever done COL adjustments out of altruism. It's because of market effects. If you pay Kansas rates for an employee in NYC, you're not going to get qualified candidates. This doesn't make a difference if the employee is driving to an office or not. Both remote and and onsite employees live somewhere. When you hire someone in NYC remotely, you're also competing with employers onsite in NYC, paying NYC rates. If there's anything that results from the shift to remote, it's going to be that companies hire fewer people in high COL locations.

betaby 6y ago

At the same time, GitLab services are NOT priced per region. Neither cost of the IPhone or Telsa is discounted in the region of FarmVille, Nowhere.

kube-system 6y ago
The price of products does often vary between regions when their is a regional explanation for the difference in price. iPhones and Teslas are priced differently in different locations, as are many many other products and services.
- betaby 6y ago
  Iphones and Teslas indeed priced differently, most of the time they cost more in the places with lower purchasing power. I.e. compare cost of Iphone in Eastern Europe and US.
  - kube-system 6y ago
    It's the same thing, "COL adjustment" is just phrased from a different viewpoint. Both are simply regional adjustments for the price of a resource. That resource could be a product, or it could be labor.
    - betaby 6y ago
      That's kind of my point - there is no 'universally cheaper' place. However on every discussion high salaries are explained as a result of higher rent. Yet no one would apply the same logic for other things, like in Easter Europe cars are expensive - here is your car price adjusted salary.
      - kube-system 6y ago
        Transportation costs are typically factored into COL calculations. Rent is the #1 thing people bring up because housing is by far the largest component of COL expenses for the vast majority of people on the planet.