From my experience working remote, there are two intertwining issues. Should geography factor into an employee's pay? And how much should pay differ in differen

From my experience working remote, there are two intertwining issues. Should geography factor into an employee's pay? And how much should pay differ in different geography? My answer to the first is yes. The second however is a bit more nuanced. The first case is when employers find the best and brightest talent from all around the world and expect these employees to work together and deliver similar value. In this case I think globally fixed base salary * a cost of living index multiplier capped at 10-15% difference makes the most sense. You don't want the pay discrepancy here to be too large as these people work together on the same level. For example, using local market rates, a Bay Area employee will likely earn double someone in the EU for the same role. The second case is when employers want to outsource work to a cheaper labor market. In this case, expectation is that the workers will not be of equal skill and/or the work can be done with little training. Another way to look at this, the relationship is more hierarchal. The HQ is managing the remote worker for work for example. In this case I think a competitive pay relative to the location's market rate make sense.