4 ms·

A company that obeys tax law? I'm not being facetious. Companies face significant legal liability for not paying taxes correctly, and they have to ensure that

A company that obeys tax law? I'm not being facetious. Companies face significant legal liability for not paying taxes correctly, and they have to ensure that all applicable federal, state, and local taxes are correctly being withheld and reported for their employees. They can't just look the other way and blindly allow employees to evade tens of thousands in SALT taxes annually.

tedivm 6y ago
There are plenty of companies who have remote workers and don't use apps to track their location.
- daeken 6y ago
  The difference is that those companies typically can trust that their employees will tell them the truth about where they're living. Facebook has set up perverse incentives given that disclosing your actual location might end up dropping your salary; that means that an employee might end up being taxed incorrectly because they don't want to disclose their location.
  - tedivm 6y ago
    Lots of remote companies pay based off of location, and again don't require tracking. What makes facebook unique?
    - CydeWeys 6y ago
      It has a much bigger target on its back.
mrfusion 6y ago
That’s a straw man. The real question is why do they have to lower your salary if you move? Is your work less valuable?
- tick_tock_tick 6y ago
  No, but once you go remote your competing against a much larger labor force. You might have been in the Nth percentile of local labor but now anyone anywhere can be your peer.
- PenguinCoder 6y ago
  I agree. This type of action is signalling the company doesn't actually pay you for your knowledge or output. It pisses me off. Flip the argument around; if FB hired you to work remotely from Montana, then you decided to move to San Francisco, would they INCREASE your pay based on COL? If the answer is "no, of course not", then why is it okay for them (or any company) to pay you less, if you move to a lower COL area? It absolutely isn't fair, and companies want to eat their cake and have it too.
  - sciurus 6y ago
    At my employer if you were hired in SF and moved to Montana, you'd take a pay cut. If you were hired in Montana and moved to SF, you'd get a pay raise. Either one requires approval. I'd be surprised if this isn't the norm in companies with a distributed workforce.
  - rsynnott 6y ago
    > This type of action is signalling the company doesn't actually pay you for your knowledge or output. And you win the Nobel prize for stating the obvious. Tech salaries today in hotspots like Silicon Valley are probably on the order of twice what they were in the early noughties. Why? Because everyone’s so much more productive these days? Or because that’s what the market dictates?
  - klipt 6y ago
    > if FB hired you to work remotely from Montana, then you decided to move to San Francisco, would they INCREASE your pay based on COL? If you actually transfer to an SF team then yes, most large, multi office companies would adjust your pay to the SF bracket. If course that requires that an SF team has headcount and wants you. You can't just move because you feel like it.
dragonwriter 6y ago
Paying remote workers based on the market rate for that work done remotely rather than arbitrarily applying location-based adjustments when the location is not germane to the work would not create a financial incentive to misrepresent location that would require the company to threaten severe consequences to gain compliance. The compliance problem Facebook is using dire threats to mitigate is wholly a consequence of their own arbitrary and irrational pay policy.
- harryh 6y ago
  It's not "arbitrary and irrational" to pay market rate salaries. The real question is "what is the market?" Historically, with most people working in physical offices, markets were very local. If you lived in Boise, ID you could mostly only get a job in Boise, ID. To the degree that remote work becomes significantly more common, I would expect those geographic barriers to break down some: salaries in the bay area and other high COL areas might drop some, while salaries in other places might rise some. I wouldn't expect complete equalization for quite some time though. Though that's just a guess. Predictions are hard. In the end though the one thing I'm sure of is that companies will do what they've always done: pay the market rate to get the labor they need. Questions of fairness are basically irrelevant.
  - aantix 6y ago
    Strangely, I already see this breakdown. Especially for senior talent. Excluding the FAANG companies, I see offers in SF consistently for 160-190K for most startups. And I've seen similar offers here in Nebraska - Omaha, even Lincoln, for a similar level of salary. Obviously less offerings, but they are there.
  - dragonwriter 6y ago
    They aren't paying market rate salaries in the market (remote work) from which they are purchasing. Nor are they even paying market rate salaries for local on-site work in the workers actual location, though that would cause the same problem as the actual policy. They are paying salaries based on a common base with cost-of-living based adjustments for the location of the employee’s residence. I bet if you chart BLS data for IT salaries against cost of living you'll find that this (as well as creating the same kind of incentives for deception about location as ignoring that remote work is a different market than local work does) that a system of CoL based adjustments doesn't map very well at all to local market pay.

tedivm 6y ago

There are plenty of companies who have remote workers and don't use apps to track their location.

daeken 6y ago
The difference is that those companies typically can trust that their employees will tell them the truth about where they're living. Facebook has set up perverse incentives given that disclosing your actual location might end up dropping your salary; that means that an employee might end up being taxed incorrectly because they don't want to disclose their location.
- tedivm 6y ago
  Lots of remote companies pay based off of location, and again don't require tracking. What makes facebook unique?
  - CydeWeys 6y ago
    It has a much bigger target on its back.

mrfusion 6y ago

That’s a straw man. The real question is why do they have to lower your salary if you move? Is your work less valuable?

tick_tock_tick 6y ago
No, but once you go remote your competing against a much larger labor force. You might have been in the Nth percentile of local labor but now anyone anywhere can be your peer.
PenguinCoder 6y ago
I agree. This type of action is signalling the company doesn't actually pay you for your knowledge or output. It pisses me off. Flip the argument around; if FB hired you to work remotely from Montana, then you decided to move to San Francisco, would they INCREASE your pay based on COL? If the answer is "no, of course not", then why is it okay for them (or any company) to pay you less, if you move to a lower COL area? It absolutely isn't fair, and companies want to eat their cake and have it too.
- sciurus 6y ago
  At my employer if you were hired in SF and moved to Montana, you'd take a pay cut. If you were hired in Montana and moved to SF, you'd get a pay raise. Either one requires approval. I'd be surprised if this isn't the norm in companies with a distributed workforce.
- rsynnott 6y ago
  > This type of action is signalling the company doesn't actually pay you for your knowledge or output. And you win the Nobel prize for stating the obvious. Tech salaries today in hotspots like Silicon Valley are probably on the order of twice what they were in the early noughties. Why? Because everyone’s so much more productive these days? Or because that’s what the market dictates?
- klipt 6y ago
  > if FB hired you to work remotely from Montana, then you decided to move to San Francisco, would they INCREASE your pay based on COL? If you actually transfer to an SF team then yes, most large, multi office companies would adjust your pay to the SF bracket. If course that requires that an SF team has headcount and wants you. You can't just move because you feel like it.

dragonwriter 6y ago

Paying remote workers based on the market rate for that work done remotely rather than arbitrarily applying location-based adjustments when the location is not germane to the work would not create a financial incentive to misrepresent location that would require the company to threaten severe consequences to gain compliance. The compliance problem Facebook is using dire threats to mitigate is wholly a consequence of their own arbitrary and irrational pay policy.

harryh 6y ago
It's not "arbitrary and irrational" to pay market rate salaries. The real question is "what is the market?" Historically, with most people working in physical offices, markets were very local. If you lived in Boise, ID you could mostly only get a job in Boise, ID. To the degree that remote work becomes significantly more common, I would expect those geographic barriers to break down some: salaries in the bay area and other high COL areas might drop some, while salaries in other places might rise some. I wouldn't expect complete equalization for quite some time though. Though that's just a guess. Predictions are hard. In the end though the one thing I'm sure of is that companies will do what they've always done: pay the market rate to get the labor they need. Questions of fairness are basically irrelevant.
- aantix 6y ago
  Strangely, I already see this breakdown. Especially for senior talent. Excluding the FAANG companies, I see offers in SF consistently for 160-190K for most startups. And I've seen similar offers here in Nebraska - Omaha, even Lincoln, for a similar level of salary. Obviously less offerings, but they are there.
- dragonwriter 6y ago
  They aren't paying market rate salaries in the market (remote work) from which they are purchasing. Nor are they even paying market rate salaries for local on-site work in the workers actual location, though that would cause the same problem as the actual policy. They are paying salaries based on a common base with cost-of-living based adjustments for the location of the employee’s residence. I bet if you chart BLS data for IT salaries against cost of living you'll find that this (as well as creating the same kind of incentives for deception about location as ignoring that remote work is a different market than local work does) that a system of CoL based adjustments doesn't map very well at all to local market pay.