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It probably gets more clicks if you talk about pay cut and tension, but if companies are expected to compensate for higher cost of living, shouldn't they be eq

by yumraj 6y ago

It probably gets more clicks if you talk about pay cut and tension, but if companies are expected to compensate for higher cost of living, shouldn't they be equally expected to take it away if a person moves to lower cost of living. Moreover, let's assume the pay cut doesn't happen - what about the people who don't or can't move. Isn't this unfair to them. Also, what about the gaming of the system. A person could ask for a higher salary saying they are in, or relocating to, the BA, then within a few months, or even days, of joining they move out.

rightbyte 6y ago
SF engineers are getting payed well becouse there is a shortage of SF engineers that can afford to live in SF with lower wages. If for any reason the engineers doesn't have to live in SF anymore wages will equalize atleast over the domestic market.
legerdemain 6y ago
More hysterical reporting from irrelevant mass media. Instead of using the perfectly standard "compensation adjustment," they went for the incendiary "pay cuts" to drive up traffic!
bluntfang 6y ago
>It probably gets more clicks if you talk about pay cut and tension, but if companies are expected to compensate for higher cost of living, shouldn't they be equally expected to take it away if a person moves to lower cost of living. If engineers are providing a tangible dollar value for their work, shouldn't they be paid what their work is worth and not paid relative to their cost of living?
- yumraj 6y ago
  No. Compensation is always tied to local economy. That would imply that for identical work a person in SF would be paid the same as a person in let’s say India. That is great for the person in India if they get as much as the person in SF. But, what about the reverse, would a person in SF be OK getting the same compensation as the person in India? What about how much they can spend? Are the corresponding wages sufficient to live? You have to consider both cases, not just assume that everyone gets SF wages regardless of where they live. And the impact on local economies when these high earners go to low cost of living wages places and buy all the real estate? Will the locals be driven out? And so on.....
defen 6y ago
> Also, what about the gaming of the system. A person could ask for a higher salary saying they are in, or relocating to, the BA, then within a few months, or even days, of joining they move out. Either the person needs to be in the Bay Area for the job, in which case the answer isn't "paycut" but "you're fired"; OR it doesn't matter where they live, so why even go through the COL rigamarole? Just offer the lowest possible amount that will get a qualified person from anywhere in the world into the seat. If your options are "200k for a person in the Bay Area" or "20k for a person from Russia" why would you pay 140k to someone in Kansas?
- Leherenn 6y ago
  Because they believe, whether right or wrong, that a developper in Kensas provides more value than one in Russia, but less than one in the Bay Area? It could be because of language, timezone, cultural difference, taxes, regulation, ... Or it could be they're simply wrong. I do believe, however, that it's a bit more nuanced than "onsite" and "remote". Not all remote places are equals.
  - defen 6y ago
    But this doesn't provide a justification for dropping the salary to match local COL of the remote employee. I realize that not everyone has this luxury, but more developers need to say "No, I'm not taking a pay cut". Firing someone is not free - there is a real cost to the company to hire a replacement.
humaniania 6y ago
It's probably worse for the economy for the company to have that extra revenue to use on hoarding or stock buybacks. The employees would spend it all over the country in a variety of ways. The companies should not cut salaries for the good of the economy.
mushbino 6y ago
> but if companies are expected to compensate for higher cost of living, shouldn't they be equally expected to take it away if a person moves to lower cost of living. The rub is that remote employees in tech have no bargaining power. This is the main reason why companies can and will pay lower salaries.

by yumraj 6y ago

rightbyte 6y ago

SF engineers are getting payed well becouse there is a shortage of SF engineers that can afford to live in SF with lower wages. If for any reason the engineers doesn't have to live in SF anymore wages will equalize atleast over the domestic market.

legerdemain 6y ago

More hysterical reporting from irrelevant mass media. Instead of using the perfectly standard "compensation adjustment," they went for the incendiary "pay cuts" to drive up traffic!

bluntfang 6y ago

>It probably gets more clicks if you talk about pay cut and tension, but if companies are expected to compensate for higher cost of living, shouldn't they be equally expected to take it away if a person moves to lower cost of living. If engineers are providing a tangible dollar value for their work, shouldn't they be paid what their work is worth and not paid relative to their cost of living?

yumraj 6y ago
No. Compensation is always tied to local economy. That would imply that for identical work a person in SF would be paid the same as a person in let’s say India. That is great for the person in India if they get as much as the person in SF. But, what about the reverse, would a person in SF be OK getting the same compensation as the person in India? What about how much they can spend? Are the corresponding wages sufficient to live? You have to consider both cases, not just assume that everyone gets SF wages regardless of where they live. And the impact on local economies when these high earners go to low cost of living wages places and buy all the real estate? Will the locals be driven out? And so on.....

defen 6y ago

> Also, what about the gaming of the system. A person could ask for a higher salary saying they are in, or relocating to, the BA, then within a few months, or even days, of joining they move out. Either the person needs to be in the Bay Area for the job, in which case the answer isn't "paycut" but "you're fired"; OR it doesn't matter where they live, so why even go through the COL rigamarole? Just offer the lowest possible amount that will get a qualified person from anywhere in the world into the seat. If your options are "200k for a person in the Bay Area" or "20k for a person from Russia" why would you pay 140k to someone in Kansas?

Leherenn 6y ago
Because they believe, whether right or wrong, that a developper in Kensas provides more value than one in Russia, but less than one in the Bay Area? It could be because of language, timezone, cultural difference, taxes, regulation, ... Or it could be they're simply wrong. I do believe, however, that it's a bit more nuanced than "onsite" and "remote". Not all remote places are equals.
- defen 6y ago
  But this doesn't provide a justification for dropping the salary to match local COL of the remote employee. I realize that not everyone has this luxury, but more developers need to say "No, I'm not taking a pay cut". Firing someone is not free - there is a real cost to the company to hire a replacement.

humaniania 6y ago

It's probably worse for the economy for the company to have that extra revenue to use on hoarding or stock buybacks. The employees would spend it all over the country in a variety of ways. The companies should not cut salaries for the good of the economy.

mushbino 6y ago

> but if companies are expected to compensate for higher cost of living, shouldn't they be equally expected to take it away if a person moves to lower cost of living. The rub is that remote employees in tech have no bargaining power. This is the main reason why companies can and will pay lower salaries.