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Location-based pay is remarkably offensive, and for the exact reason you state: > you have basically handed your wallet to the "wallet inspector" By accepting

Location-based pay is remarkably offensive, and for the exact reason you state: > you have basically handed your wallet to the "wallet inspector" By accepting location-based pay, you concede that your employer has the right to treat you like a child receiving an allowance; that your remuneration is based on the lifestyle that they think is appropriate for you, and not on the market value of your work. But your choice of lifestyle, your needs, etc, are strictly none of their business and it's exceptionally inappropriate for employers to act like your parents. Once you let these people "inspect your wallet," you are establishing an abusive relationship and will get hustled around the clock.

DanHulton 6y ago
Absolutely, and also it opens up a whole host of other questions that are similarly intrusive: - I have a family with children. Should I get paid more than an employee who lives alone? - I have a big house that has a large mortgage. Should I get paid more than an employee who lives in a cheap apartment? - I have purchased a yacht that requires maintenance. Should I get paid more than an employee who hasn't? Sure, the last one is ridiculous, but honestly, they're _all_ ridiculous. The idea that your employer should be able to look at your expenses and judge which ones are valid and which ones aren't, and then adjust your pay "appropriately" is offensive on a deep level.
- dmitryminkovsky 6y ago
  > The idea that your employer should be able to look at your expenses and judge which ones are valid and which ones aren't, and then adjust your pay "appropriately" is offensive on a deep level. It truly is. I may have a passion for Alizé and Cristal and to afford that passion I may want to live in a rural setting. That’s my business. Who are these people to try and tell me that whether I live in SF or Nebraska, they’re only going to let me drink André?
  - true_religion 6y ago
    The argument from the employers point of view is: we are forcing you to live in SF in order to work, thus we will pay you a premium to accept our choices. If an employer has nothing to do with your lifestyle choices, then they won't pay for them. For a truly remote position, they won't pay extra if you life in NY/SF vs Nebraska. However, I think the world hasn't adapted to that market economics yet, so in this time of transition people talk about location-based pay as a stopgap measure. Software development doesn't benefit from a centralized location, so in the future developers won't naturally live in big expensive cities and employers won't pay them wages that permit them to do so. To be honest, I think the best thing would be for SW Devs to have a guild that aids in collective bargaining. Otherwise, the power balance will gradually tilt too far towards employers. Other professional jobs (e.g. medicine, law) have similar arrangements, and that's the only reason why pay can remain high in them.
    - runarberg 6y ago
      > guild that aids in collective bargaining Sort of like a worker’s union?
- motohagiography 6y ago
  I don't have a boat, my friends who do have one bill based on what it costs to maintain it. Do they tell the HR person or clients "I have a boat I need to maintain," never, as that just gives away leverage, but they only seek out roles that facilitate their life. The language itself, "should I get paid" assumes a parental allowance relationship and we should get out of the habit of using it. "Get paid" is a day-labourers colloquialism. The form of the phrase itself defines you as the passive subject. Bill for work, draw a salary, agree to compensation, accept consideration, negotiate a package, earn bonuses, settle invoices, sell services (not time), sell equity - do not "get paid" by anyone. It's a psychological impediment that keeps people poor.
  - cantankerous 6y ago
    Structural impediments keep people poor. Not internal monologues.
    - K0balt 6y ago
      Internal monolouges enable structural inequalities and broken paradigmes. Memetic constructs form the basis for all societal constructs, so I think maybe you are under selling the importance of thoughts in this case.
      - syops 6y ago
        Your first sentence is quite a claim. Do you have evidence that this is what enables structural inequalities and broken paradigms? Maybe it would be more reasonable to say such internal monologues help perpetuate these things. It seems to me that the structural inequality comes from first.
    - GavinMcG 6y ago
      Internal monologues absolutely keep people poor. Failure to effectively negotiate is nearly 100% about internal monologues, particularly once the time has come for negotiation.
    - anaerobicover 6y ago
- lotsofpulp 6y ago
  >The idea that your employer should be able to look at your expenses and judge which ones are valid and which ones aren't, and then adjust your pay "appropriately" is offensive on a deep level. No one making these decisions actually has this idea. It's just more acceptable PR than "we're going to lower your pay because we think you will accept it because we think that you won't or you think you won't have better options."
- adkadskhj 6y ago
  > I have a family with children. Should I get paid more than an employee who lives alone? - I have a big house that has a large mortgage. Should I get paid more than an employee who lives in a cheap apartment? - I have purchased a yacht that requires maintenance. Should I get paid more than an employee who hasn't? Should you? No. Do you have to? Yes. If you have a family of four, a yacht and a mortgage maybe you need to make - say - $200k/y. Cool. But what about some single guy with none of those things, he can work for $100k/y and make the same profit as you. Are you saying he shouldn't use his competitive advantage over you to get hired? This isn't about the employer. It's about the employee, and what their life allows them to work for.
  - enumjorge 6y ago
    > It's about the employee, and what their life allows them to work for. So rather than compete in the job market based on your skill set and what value they bring to a company, you should instead focus on not starting a family and living as cheaply as possible in order to make yourself attractive to companies. I'm sure employers would love for you to center your life around making yourself as cheap to hire as possible, but from the point of view of the employee it sounds extremely unhealthy.
    - adkadskhj 6y ago
      > So rather than compete in the job market based on your skill set and what value they bring to a company, you should instead focus on not starting a family and living as cheaply as possible in order to make yourself attractive to companies. I'm sure employers would love for you to center your life around making yourself as cheap to hire as possible, but from the point of view of the employee it sounds extremely unhealthy. Maybe. I got into this market because i was able to apply at a much cheaper position, beating out other more skilled employees. I levered my lower pay to offset my lack of history in the market. Were there more skilled people applying? Definitely. Did they apply at a higher rate? Definitely. Sure if you wanted to go to extremes you should live as cheaply as possible. But you could say that about anything. Instead, live how you want to live and expect to deal with that cost of living. You said it yourself, "skill set and what value they bring". What value you bring to a company is relative to what they pay you. If you cost $500k/y but your skillset is that of a junior engineer, do you honestly think your value is the same of a similar junior engineer working for $100k/y? Unlikely. If you want to live in a city you are simply required to make more money than someone living in a rural environment. If i have a huge mortgage i can't work at walmart. I need to make more. These are all relative values based on COL, how much you spend, etc. This shouldn't be a controversial statement, in my view. Mind you i'm very liberal. I believe in worker rights. But forcing everyone to be paid for insanely high COL SF rates seems bonkers. Absolute bonkers.
- GekkePrutser 6y ago
  The reason they look at cost of living is because they won't fill the jobs otherwise. You can pay a Bangalore wage for a developer in San Francisco but it'd be less than a local janitor makes. So obviously they have to take this into account.
matz1 6y ago
Its just part of negotiation, The reason I will accept lower pay is to entice you to continue using my service, rather than replacing me with other people. Its not about the location, employer should always try maximize profit, if they can get the same service with lower expense, they should.
- biztos 6y ago
  OK, but if "lower pay" is a main enticing tactic, don't be shocked when someone else in a cheaper locale makes them a "better" offer and they accept it.
  - deleted 6y ago
    [deleted]
  - stevegalla 6y ago
    They don’t even need to be in a cheaper location. I have worked with two kinds of employees that are willing to accept lower pay. - those moving for a better lifestyle who have earned and saved considerably more elsewhere. I call these “working retirees”. - those who have family sending them money to subsidize their cost of living in an expensive city.
- dmitryminkovsky 6y ago
  That is right, one can chose to accept any offer that works for them for whatever reason. If you have no leverage, you may need to accept an offer just to avoid being replaced by other people. But, I am saying, that if you accept an offer that is based on what your employer thinks is an appropriate lifestyle for you, adjusted to the cost of living in your area, and not on the value of your work, that will immediately establish what I consider is a particularly inappropriate relationship between employer and employee. Of course this happens all the time for many reasons, but what we're seeing now is employers inventing and normalizing yet another, new tactic to deploy when trying to get you to accept less compensation. It's just another trick. But what's particularly insidious about this trick is that what they're doing is openly laying claim to your lifestyle by saying that: suppose you're a senior developer, you are entitled to organic groceries, whereas a junior developer is entitled to conventional produce, regardless of where you live, that's what you deserve. But that's wholly inappropriate: your compensation should depend on what you produce, and your lifestyle should be none of their business. If I want to move to Thailand or the middle of a field in Nebraska and save money, that's none of their business. There is no "objective" lifestyle that a senior developer should be entitled to. But that's this new trick they are trying to pull, and it's nothing short of disturbing and creepy.
motohagiography 6y ago
I like your allowance simile better than my post.
bradleyjg 6y ago
> and not on the market value of your work. The market value of your work depends, in no small part, on whether or not that work includes showing your face X days a week at an office in San Francisco.
- RA_Fisher 6y ago
  Sure, for inefficient businesses likely to have their lunch eaten by wiser competition.
  - bradleyjg 6y ago
    That remains to be seen, doesn’t it? Because right now the scoreboard is looking pretty good for companies with lots of office space in the Bay Area.
    - mrybczyn 6y ago
      https://en.wikipedia.org/wiki/Causal_analysis https://en.wikipedia.org/wiki/Causal_analysis
- dmitryminkovsky 6y ago
  For sure I see the argument there: it is way more of a pain in the ass to show up to an office on Market Street than chilling wherever you want. And if that was their stated argument, I'd have no problem with it. However, that this not the argument these people are making. The argument I see time and again is that your compensation should be location-adjusted based on cost of living. And by making that argument, they are clearly saying you are—or are not—entitled to a certain degree of living, which is where it gets creepy, inappropriate and inevitably abusive. And why do I say creepy? Because saying that a person does or does not deserve a certain lifestyle, and saying that they will or will not facilitate that lifestyle for you, crosses a boundary into your personal life that degrades you as an independent individual who is entitled to decide whether or not you do basic things like saving money. Instead of treating you like a person, they treat you and force you to conceive of yourself some sort of "lifestyle consumer." Sure, some people just have no leverage. But normalizing this way if thinking is going to lead us down an even worse labor path than we are on right now. Your employer is not your legal guardian.
nipponese 6y ago
Isn’t having a “wallet inspector” what working a salary gig is all about? Low financial risk for pre-determined financial reward?
- willcipriano 6y ago
  It was, but they got rid of the pension and the gold watch so it really isn't like that anymore.
djhworld 6y ago
> you concede that your employer has the right to treat you like a child receiving an allowance (off-topic) this reminds me of a job interview I had early in my career. The person interviewing me was one of the directors of the company and he asked me why I'd requested such a salary. Initially I was thinking he'd want me to answer some bullshit about Bringing Value To The Company etc but he started probing about my personal life - do I have a wife/kids, what do I spent money on, how much is your rent, how much disposable income do you have and why do you want more. Needless to say I wasn't impressed by this and decided to cut the interview short.
- deleted 6y ago
  [deleted]
- walshemj 6y ago
  Dodged a bullet there.
  - izacus 6y ago
    > Dodged a bullet there. Except that it seems that there are a whole machine gun worth of bullets just in this HN thread.
- dvirsky 6y ago
  At one of my first jobs in the early days of the internet, the hiring manager had a very low budget and was offering me really really low pay, and to try and convince me he literally said: "Look, I know it's not much, but we work long hours here and there's free food. You'll get home at around 9pm every day and just collapse to sleep, so believe me, your expenses will be very, very low". (I actually took the job despite this because I wanted to get on the internet train, and I don't regret it. Also, it took me a bit over a year to take over that manager's role and make X2.5 of the original lowball salary)
cactus2093 6y ago
> and not on the market value of your work Interesting choice to invoke market value to argue that the salaries that the market has settled on for remote work are too low. The market value of work isn't the amount of revenue that the work brings in. If you think you can capture the full value of the work you do for yourself, you're always free to work as a solo entrepreneur instead of working a traditional job. That's kind of an upper bound on what the company could pay you, but the market value of the work is based on the number of employees the company needs and the number of qualified employees they can find. Remote work floods the supply with lots more available workers than they can find in any one city, so salaries for those roles go down. That's not treating you like a child, it's just how a market works.
- cmeacham98 6y ago
  Your comment could justify a divide in pay between in-person and remote workers. Presumably, the ability to be available in person is valuable in some companies and the market for that is smaller, so more compensation. However, what it does not justify is location-based pay. From the company's perspective, there is no significant difference between a remote worker in New York City or Birmingham, Alabama.
  - ianai 6y ago
    It’s funny how the power of markets seems so easily used to reinforce the current market outcome. Like wage prices are artificially high or right where they should be because the market must be right. Without looking at the factors closely (like one should when discussing labor especially), there’s the possible outcome that current wages are held down below their market clearing prices by external factors and market power.
    - Negitivefrags 6y ago
      The market is always right pretty much by definition. The “external factors” you speak of are the market conditions in which the market operates. You can change the external factors and the market will rebalance to a new equalibrium but that doenst mean the market was wrong before and correct now.
shoguning 6y ago
Or they believe (possibly correctly) that you don't have as strong a negotiating position because there are fewer options for you based on location.
- alach11 6y ago
  This is it. Free market at work. If you live in Tulsa, OK you won't have easy access to as many $150k jobs. The goal of the company is to get the best quality of work for the lowest price. Why would they pay extra?
  - repsilat 6y ago
    People move, and these policies give people an incentive be in certain places. Paying more in SF is saying, "Please move to a city where you'll have more opportunities outside this company." The company is shelling out five or six figures to increase your cost of living, bid up SF house prices, and increase your likelihood of leaving the company. And even the other way around -- "Don't move somewhere you'd rather be, where you'd be happier and more loyal. We'll cut your pay if you do." When looking at an individual employee's decisions, these policies don't seem to help the company. I think they only really make sense when thinking about populations, where people are less mobile and more fungible.
LudwigNagasena 6y ago
Location-based pay is based on your market value. Different locations have different markets.
- lazide 6y ago
  In a location constrained, pre wfh market you are right. Now, that is definitely not the case. For those working remotely before, it also pulls back the current more directly. Local cost of living, if everyone is working remotely, has no bearing on the value you provide your employer. Discussing location based pay in that environment is rather absurd, is it not?
  - LudwigNagasena 6y ago
    If it stops being the case, the salaries will equalize due to market pressures. But it is not the case and it probably will never be the case because different locations have different amenities and different economic situations in general, this coupled with the fact that lots of jobs can’t be done from home means that local job markets will always be differentiated.
    - lazide 6y ago
      It's not an if (for certain industries), it's been happening and is only accelerating. It's exactly what was behind the outsourcing to India of IT for instance. The difference now is artificial constraints within countries around locale are loosening, meaning locals can play the same game (and take advantage of similar bid/ask spreads personally). IT work in India happened because while super hard to get started/get over the bar, the wage differential was huge (between what a viable candidate would accept, and what the company was willing to pay). Multinationals who could get over the bar to take advantage of it have reaped trillions. For jobs that are fundamentally local, it is different (plumber for instance). The number of those jobs is decreasing over time, however. This will likely result in a 'reverse brain drain' as long as conditions persist, with rural areas benefitting from smart and ambitious people no longer being forced to relocate to a city to benefit. They'll pump money into the local economy. For people already remote, they'll have more competition and will need to continue to differentiate. For those in cities, well - it's gonna be rough. Long term, it's likely that center of gravity will shift back to the cities - physical distance does have beneficial effects, and at least when there isn't a pandemic, it tends to override the other issues with city life (competition for space means high rents, noise, etc.). It might take awhile though.
wpietri 6y ago
I'm not a fan of location-based pay, but I think this is too strident: > that your remuneration is based on the lifestyle that they think is appropriate for you Often, these schemes happen because it's employees who have lifestyle expectations. "I'd love to work for your company, but I'm not cutting my standard of living." And that's reasonable. The raw amount of money means way less to most people than what it means for their lives. And straight cash compensation is only one factor in picking a job. The truth here is that the Internet has caused context collapse in far more than work. Labor markets used to be local. They still mostly are, but for those of us lucky enough to be able to work remotely, that's changing. That's going to have knock-on effects in other markets (housing, food, education, etc) for at least a couple of generations. As we jointly work out the new normal, I think it's worth starting with the assumption that people are not all complete assholes. Yes, by all means let's watch out for worker exploitation; there's a lot of it. But from what I've seen, so many policies are just well-meaning people tinkering with things that they inherited. We can be firm about negotiating for fairness without assuming everybody's out to get us.
jiveturkey 6y ago
> employer has the right to treat you like a child receiving an allowance i can’t understand this pov at all. unlike a child allowance, you can say no and court a different parent. you are simply labor, and location based pay reflects this. the only ones complaining are those receiving less pay. it’s like when people complain (loudly) that “stealerships” add a markup above msrp for high demand cars, but the same people don’t complain about discounts from msrp for basic cars. if you don’t want the car at the offered price, move on!
ymbeld 6y ago
The employer setting most of the terms is the reality for most of the working class.
joe_the_user 6y ago
I'm against location based pay. But I'm not sure your argument is a good one against it. Just about all benefits offered by employers, from maternity leave to health care, function as allowances for particular purposes. They pay a variable amount based on the varying needs of a workforce. One could even relabel the location-based-pay as a "rent supplement". If everyone get the same pay but those paying crazy high rents get extra to ameliorate this, it sound better. Which still isn't saying I like this idea. I don't think pay should be able to be easily translated to benefits and I think only things that are unalterably unequal, like health care and maternity leave, should be doled out as benefits. But I don't think one can make the argument that "allowance" type pay is inherently offensive. I mean, one allowance thing that's totally reasonable is when employees have to go to conferences for a work and the employer gives them an allowance for the incidental expenses they're incur.
- lazide 6y ago
  You’re still confusing your costs as important here - which is very convenient for employers! It isn’t how they operate (if they’re smart anyway) in the open market, and if you’re smart you won’t operate that way in the labor market either. Understand and negotiate based off the value you provide, and what you can bring to the business. Chances are, your local cost of living has very little to do with that.
  - joe_the_user 6y ago
    You’re still confusing your costs as important here - which is very convenient for employers! No, I'm just saying sometimes employers can reasonably take employee costs into account - health care, maternity leave, day care, etc. Not here, I agree employers should not consider this. But I think saying employers should never take variable employee costs into account is an argument that's wrong, so making that absolutist argument won't help the case.
    - lazide 6y ago
      I don’t think that was the argument was it? It’s all negotiations. If you think it’s worth taking a $10k paycut for a $5k (for the business)/$12k (as an individual) health plan, then it’s win-win. If you take a $10k paycheck because you live in Nebraska (and nothing else), and the Company is in SF? That’s just bad negotiating. If the company is in Nebraska and only pays $10k less and can get plenty of takers locally - then they won’t get many people from SF, and they’re probably fine with that.
znpy 6y ago
I tend to agree with your post (how could I not, i'm on the same side of the table as you) but I cannot help but see THE fallacy in your thinking. You claim that you should be paid based on market value. You are probably speaking about the pre-covid market value. But once you open up to full-remote working... The market broadens immensely. Your "competitors" in the market are not bay-area people anymore. It's the whole US. If your company has branches in other countries too (think FAANGs) and the workforce was already spread across timezone then now most of the world is filled with potential competitors for your job. And now with a huge supply of workers, your market value decreases a lot. And to be 100% honest: as an european, if you (an american) think you're worth 250k and your employer is thinking of firing you and offering me 125k for your job... Well good luck with your next job search.
- u678u 6y ago
  > Your "competitors" in the market are not bay-area people anymore. It's the whole US. Agreed, not just American, anyone roughly in the same time zone. There are lots of well educated people in Peru/Chile/Brazil that would work 24hrs a day for a $25k salary.
andrepd 6y ago
But, as a certain bearded German economist once noted, the remuneration of labour is not related to the value it produces. As long as there is a reserve mass of unemployed people, that remuneration is related to the minimum that the worker needs to survive. Agree or disagree with the rest, Marx was right on the money with this one. Of course, since there is more demand than supply of qualified workers, remuneration rises above that minimum. But as long as an Indian developer is "glad" to do the same work as you for 1/4 pay...
doublejay1999 6y ago
the only question, is how long employers will continue to pay a premium based on your postcode.
lucideer 6y ago
> offensive You're really not doing the HN user stereotype of entitled valley types any favors using very personal ego-centred words such as "offensive".
Spooky23 6y ago
Weird argument. I guess you can have your freedom and live in some tent city in Palo Alto under the freeway, or live in a reasonable house anywhere else.

DanHulton 6y ago

Absolutely, and also it opens up a whole host of other questions that are similarly intrusive: - I have a family with children. Should I get paid more than an employee who lives alone? - I have a big house that has a large mortgage. Should I get paid more than an employee who lives in a cheap apartment? - I have purchased a yacht that requires maintenance. Should I get paid more than an employee who hasn't? Sure, the last one is ridiculous, but honestly, they're _all_ ridiculous. The idea that your employer should be able to look at your expenses and judge which ones are valid and which ones aren't, and then adjust your pay "appropriately" is offensive on a deep level.

dmitryminkovsky 6y ago
> The idea that your employer should be able to look at your expenses and judge which ones are valid and which ones aren't, and then adjust your pay "appropriately" is offensive on a deep level. It truly is. I may have a passion for Alizé and Cristal and to afford that passion I may want to live in a rural setting. That’s my business. Who are these people to try and tell me that whether I live in SF or Nebraska, they’re only going to let me drink André?
- true_religion 6y ago
  The argument from the employers point of view is: we are forcing you to live in SF in order to work, thus we will pay you a premium to accept our choices. If an employer has nothing to do with your lifestyle choices, then they won't pay for them. For a truly remote position, they won't pay extra if you life in NY/SF vs Nebraska. However, I think the world hasn't adapted to that market economics yet, so in this time of transition people talk about location-based pay as a stopgap measure. Software development doesn't benefit from a centralized location, so in the future developers won't naturally live in big expensive cities and employers won't pay them wages that permit them to do so. To be honest, I think the best thing would be for SW Devs to have a guild that aids in collective bargaining. Otherwise, the power balance will gradually tilt too far towards employers. Other professional jobs (e.g. medicine, law) have similar arrangements, and that's the only reason why pay can remain high in them.
  - runarberg 6y ago
    > guild that aids in collective bargaining Sort of like a worker’s union?
motohagiography 6y ago
I don't have a boat, my friends who do have one bill based on what it costs to maintain it. Do they tell the HR person or clients "I have a boat I need to maintain," never, as that just gives away leverage, but they only seek out roles that facilitate their life. The language itself, "should I get paid" assumes a parental allowance relationship and we should get out of the habit of using it. "Get paid" is a day-labourers colloquialism. The form of the phrase itself defines you as the passive subject. Bill for work, draw a salary, agree to compensation, accept consideration, negotiate a package, earn bonuses, settle invoices, sell services (not time), sell equity - do not "get paid" by anyone. It's a psychological impediment that keeps people poor.
- cantankerous 6y ago
  Structural impediments keep people poor. Not internal monologues.
  - K0balt 6y ago
    Internal monolouges enable structural inequalities and broken paradigmes. Memetic constructs form the basis for all societal constructs, so I think maybe you are under selling the importance of thoughts in this case.
    - syops 6y ago
      Your first sentence is quite a claim. Do you have evidence that this is what enables structural inequalities and broken paradigms? Maybe it would be more reasonable to say such internal monologues help perpetuate these things. It seems to me that the structural inequality comes from first.
  - GavinMcG 6y ago
    Internal monologues absolutely keep people poor. Failure to effectively negotiate is nearly 100% about internal monologues, particularly once the time has come for negotiation.
  - anaerobicover 6y ago
lotsofpulp 6y ago
>The idea that your employer should be able to look at your expenses and judge which ones are valid and which ones aren't, and then adjust your pay "appropriately" is offensive on a deep level. No one making these decisions actually has this idea. It's just more acceptable PR than "we're going to lower your pay because we think you will accept it because we think that you won't or you think you won't have better options."
adkadskhj 6y ago
> I have a family with children. Should I get paid more than an employee who lives alone? - I have a big house that has a large mortgage. Should I get paid more than an employee who lives in a cheap apartment? - I have purchased a yacht that requires maintenance. Should I get paid more than an employee who hasn't? Should you? No. Do you have to? Yes. If you have a family of four, a yacht and a mortgage maybe you need to make - say - $200k/y. Cool. But what about some single guy with none of those things, he can work for $100k/y and make the same profit as you. Are you saying he shouldn't use his competitive advantage over you to get hired? This isn't about the employer. It's about the employee, and what their life allows them to work for.
- enumjorge 6y ago
  > It's about the employee, and what their life allows them to work for. So rather than compete in the job market based on your skill set and what value they bring to a company, you should instead focus on not starting a family and living as cheaply as possible in order to make yourself attractive to companies. I'm sure employers would love for you to center your life around making yourself as cheap to hire as possible, but from the point of view of the employee it sounds extremely unhealthy.
  - adkadskhj 6y ago
    > So rather than compete in the job market based on your skill set and what value they bring to a company, you should instead focus on not starting a family and living as cheaply as possible in order to make yourself attractive to companies. I'm sure employers would love for you to center your life around making yourself as cheap to hire as possible, but from the point of view of the employee it sounds extremely unhealthy. Maybe. I got into this market because i was able to apply at a much cheaper position, beating out other more skilled employees. I levered my lower pay to offset my lack of history in the market. Were there more skilled people applying? Definitely. Did they apply at a higher rate? Definitely. Sure if you wanted to go to extremes you should live as cheaply as possible. But you could say that about anything. Instead, live how you want to live and expect to deal with that cost of living. You said it yourself, "skill set and what value they bring". What value you bring to a company is relative to what they pay you. If you cost $500k/y but your skillset is that of a junior engineer, do you honestly think your value is the same of a similar junior engineer working for $100k/y? Unlikely. If you want to live in a city you are simply required to make more money than someone living in a rural environment. If i have a huge mortgage i can't work at walmart. I need to make more. These are all relative values based on COL, how much you spend, etc. This shouldn't be a controversial statement, in my view. Mind you i'm very liberal. I believe in worker rights. But forcing everyone to be paid for insanely high COL SF rates seems bonkers. Absolute bonkers.
GekkePrutser 6y ago
The reason they look at cost of living is because they won't fill the jobs otherwise. You can pay a Bangalore wage for a developer in San Francisco but it'd be less than a local janitor makes. So obviously they have to take this into account.

matz1 6y ago

Its just part of negotiation, The reason I will accept lower pay is to entice you to continue using my service, rather than replacing me with other people. Its not about the location, employer should always try maximize profit, if they can get the same service with lower expense, they should.

biztos 6y ago
OK, but if "lower pay" is a main enticing tactic, don't be shocked when someone else in a cheaper locale makes them a "better" offer and they accept it.
- deleted 6y ago
  [deleted]
- stevegalla 6y ago
  They don’t even need to be in a cheaper location. I have worked with two kinds of employees that are willing to accept lower pay. - those moving for a better lifestyle who have earned and saved considerably more elsewhere. I call these “working retirees”. - those who have family sending them money to subsidize their cost of living in an expensive city.
dmitryminkovsky 6y ago
That is right, one can chose to accept any offer that works for them for whatever reason. If you have no leverage, you may need to accept an offer just to avoid being replaced by other people. But, I am saying, that if you accept an offer that is based on what your employer thinks is an appropriate lifestyle for you, adjusted to the cost of living in your area, and not on the value of your work, that will immediately establish what I consider is a particularly inappropriate relationship between employer and employee. Of course this happens all the time for many reasons, but what we're seeing now is employers inventing and normalizing yet another, new tactic to deploy when trying to get you to accept less compensation. It's just another trick. But what's particularly insidious about this trick is that what they're doing is openly laying claim to your lifestyle by saying that: suppose you're a senior developer, you are entitled to organic groceries, whereas a junior developer is entitled to conventional produce, regardless of where you live, that's what you deserve. But that's wholly inappropriate: your compensation should depend on what you produce, and your lifestyle should be none of their business. If I want to move to Thailand or the middle of a field in Nebraska and save money, that's none of their business. There is no "objective" lifestyle that a senior developer should be entitled to. But that's this new trick they are trying to pull, and it's nothing short of disturbing and creepy.

motohagiography 6y ago

I like your allowance simile better than my post.

bradleyjg 6y ago

> and not on the market value of your work. The market value of your work depends, in no small part, on whether or not that work includes showing your face X days a week at an office in San Francisco.

RA_Fisher 6y ago
Sure, for inefficient businesses likely to have their lunch eaten by wiser competition.
- bradleyjg 6y ago
  That remains to be seen, doesn’t it? Because right now the scoreboard is looking pretty good for companies with lots of office space in the Bay Area.
  - mrybczyn 6y ago
    https://en.wikipedia.org/wiki/Causal_analysis https://en.wikipedia.org/wiki/Causal_analysis
dmitryminkovsky 6y ago
For sure I see the argument there: it is way more of a pain in the ass to show up to an office on Market Street than chilling wherever you want. And if that was their stated argument, I'd have no problem with it. However, that this not the argument these people are making. The argument I see time and again is that your compensation should be location-adjusted based on cost of living. And by making that argument, they are clearly saying you are—or are not—entitled to a certain degree of living, which is where it gets creepy, inappropriate and inevitably abusive. And why do I say creepy? Because saying that a person does or does not deserve a certain lifestyle, and saying that they will or will not facilitate that lifestyle for you, crosses a boundary into your personal life that degrades you as an independent individual who is entitled to decide whether or not you do basic things like saving money. Instead of treating you like a person, they treat you and force you to conceive of yourself some sort of "lifestyle consumer." Sure, some people just have no leverage. But normalizing this way if thinking is going to lead us down an even worse labor path than we are on right now. Your employer is not your legal guardian.

nipponese 6y ago

Isn’t having a “wallet inspector” what working a salary gig is all about? Low financial risk for pre-determined financial reward?

willcipriano 6y ago
It was, but they got rid of the pension and the gold watch so it really isn't like that anymore.

djhworld 6y ago

> you concede that your employer has the right to treat you like a child receiving an allowance (off-topic) this reminds me of a job interview I had early in my career. The person interviewing me was one of the directors of the company and he asked me why I'd requested such a salary. Initially I was thinking he'd want me to answer some bullshit about Bringing Value To The Company etc but he started probing about my personal life - do I have a wife/kids, what do I spent money on, how much is your rent, how much disposable income do you have and why do you want more. Needless to say I wasn't impressed by this and decided to cut the interview short.

deleted 6y ago
[deleted]
walshemj 6y ago
Dodged a bullet there.
- izacus 6y ago
  > Dodged a bullet there. Except that it seems that there are a whole machine gun worth of bullets just in this HN thread.
dvirsky 6y ago
At one of my first jobs in the early days of the internet, the hiring manager had a very low budget and was offering me really really low pay, and to try and convince me he literally said: "Look, I know it's not much, but we work long hours here and there's free food. You'll get home at around 9pm every day and just collapse to sleep, so believe me, your expenses will be very, very low". (I actually took the job despite this because I wanted to get on the internet train, and I don't regret it. Also, it took me a bit over a year to take over that manager's role and make X2.5 of the original lowball salary)

cactus2093 6y ago

> and not on the market value of your work Interesting choice to invoke market value to argue that the salaries that the market has settled on for remote work are too low. The market value of work isn't the amount of revenue that the work brings in. If you think you can capture the full value of the work you do for yourself, you're always free to work as a solo entrepreneur instead of working a traditional job. That's kind of an upper bound on what the company could pay you, but the market value of the work is based on the number of employees the company needs and the number of qualified employees they can find. Remote work floods the supply with lots more available workers than they can find in any one city, so salaries for those roles go down. That's not treating you like a child, it's just how a market works.

cmeacham98 6y ago
Your comment could justify a divide in pay between in-person and remote workers. Presumably, the ability to be available in person is valuable in some companies and the market for that is smaller, so more compensation. However, what it does not justify is location-based pay. From the company's perspective, there is no significant difference between a remote worker in New York City or Birmingham, Alabama.
- ianai 6y ago
  It’s funny how the power of markets seems so easily used to reinforce the current market outcome. Like wage prices are artificially high or right where they should be because the market must be right. Without looking at the factors closely (like one should when discussing labor especially), there’s the possible outcome that current wages are held down below their market clearing prices by external factors and market power.
  - Negitivefrags 6y ago
    The market is always right pretty much by definition. The “external factors” you speak of are the market conditions in which the market operates. You can change the external factors and the market will rebalance to a new equalibrium but that doenst mean the market was wrong before and correct now.

shoguning 6y ago

Or they believe (possibly correctly) that you don't have as strong a negotiating position because there are fewer options for you based on location.

alach11 6y ago
This is it. Free market at work. If you live in Tulsa, OK you won't have easy access to as many $150k jobs. The goal of the company is to get the best quality of work for the lowest price. Why would they pay extra?
- repsilat 6y ago
  People move, and these policies give people an incentive be in certain places. Paying more in SF is saying, "Please move to a city where you'll have more opportunities outside this company." The company is shelling out five or six figures to increase your cost of living, bid up SF house prices, and increase your likelihood of leaving the company. And even the other way around -- "Don't move somewhere you'd rather be, where you'd be happier and more loyal. We'll cut your pay if you do." When looking at an individual employee's decisions, these policies don't seem to help the company. I think they only really make sense when thinking about populations, where people are less mobile and more fungible.

LudwigNagasena 6y ago

Location-based pay is based on your market value. Different locations have different markets.

lazide 6y ago
In a location constrained, pre wfh market you are right. Now, that is definitely not the case. For those working remotely before, it also pulls back the current more directly. Local cost of living, if everyone is working remotely, has no bearing on the value you provide your employer. Discussing location based pay in that environment is rather absurd, is it not?
- LudwigNagasena 6y ago
  If it stops being the case, the salaries will equalize due to market pressures. But it is not the case and it probably will never be the case because different locations have different amenities and different economic situations in general, this coupled with the fact that lots of jobs can’t be done from home means that local job markets will always be differentiated.
  - lazide 6y ago
    It's not an if (for certain industries), it's been happening and is only accelerating. It's exactly what was behind the outsourcing to India of IT for instance. The difference now is artificial constraints within countries around locale are loosening, meaning locals can play the same game (and take advantage of similar bid/ask spreads personally). IT work in India happened because while super hard to get started/get over the bar, the wage differential was huge (between what a viable candidate would accept, and what the company was willing to pay). Multinationals who could get over the bar to take advantage of it have reaped trillions. For jobs that are fundamentally local, it is different (plumber for instance). The number of those jobs is decreasing over time, however. This will likely result in a 'reverse brain drain' as long as conditions persist, with rural areas benefitting from smart and ambitious people no longer being forced to relocate to a city to benefit. They'll pump money into the local economy. For people already remote, they'll have more competition and will need to continue to differentiate. For those in cities, well - it's gonna be rough. Long term, it's likely that center of gravity will shift back to the cities - physical distance does have beneficial effects, and at least when there isn't a pandemic, it tends to override the other issues with city life (competition for space means high rents, noise, etc.). It might take awhile though.

wpietri 6y ago

I'm not a fan of location-based pay, but I think this is too strident: > that your remuneration is based on the lifestyle that they think is appropriate for you Often, these schemes happen because it's employees who have lifestyle expectations. "I'd love to work for your company, but I'm not cutting my standard of living." And that's reasonable. The raw amount of money means way less to most people than what it means for their lives. And straight cash compensation is only one factor in picking a job. The truth here is that the Internet has caused context collapse in far more than work. Labor markets used to be local. They still mostly are, but for those of us lucky enough to be able to work remotely, that's changing. That's going to have knock-on effects in other markets (housing, food, education, etc) for at least a couple of generations. As we jointly work out the new normal, I think it's worth starting with the assumption that people are not all complete assholes. Yes, by all means let's watch out for worker exploitation; there's a lot of it. But from what I've seen, so many policies are just well-meaning people tinkering with things that they inherited. We can be firm about negotiating for fairness without assuming everybody's out to get us.

jiveturkey 6y ago

> employer has the right to treat you like a child receiving an allowance i can’t understand this pov at all. unlike a child allowance, you can say no and court a different parent. you are simply labor, and location based pay reflects this. the only ones complaining are those receiving less pay. it’s like when people complain (loudly) that “stealerships” add a markup above msrp for high demand cars, but the same people don’t complain about discounts from msrp for basic cars. if you don’t want the car at the offered price, move on!

ymbeld 6y ago

The employer setting most of the terms is the reality for most of the working class.

joe_the_user 6y ago

I'm against location based pay. But I'm not sure your argument is a good one against it. Just about all benefits offered by employers, from maternity leave to health care, function as allowances for particular purposes. They pay a variable amount based on the varying needs of a workforce. One could even relabel the location-based-pay as a "rent supplement". If everyone get the same pay but those paying crazy high rents get extra to ameliorate this, it sound better. Which still isn't saying I like this idea. I don't think pay should be able to be easily translated to benefits and I think only things that are unalterably unequal, like health care and maternity leave, should be doled out as benefits. But I don't think one can make the argument that "allowance" type pay is inherently offensive. I mean, one allowance thing that's totally reasonable is when employees have to go to conferences for a work and the employer gives them an allowance for the incidental expenses they're incur.

lazide 6y ago
You’re still confusing your costs as important here - which is very convenient for employers! It isn’t how they operate (if they’re smart anyway) in the open market, and if you’re smart you won’t operate that way in the labor market either. Understand and negotiate based off the value you provide, and what you can bring to the business. Chances are, your local cost of living has very little to do with that.
- joe_the_user 6y ago
  You’re still confusing your costs as important here - which is very convenient for employers! No, I'm just saying sometimes employers can reasonably take employee costs into account - health care, maternity leave, day care, etc. Not here, I agree employers should not consider this. But I think saying employers should never take variable employee costs into account is an argument that's wrong, so making that absolutist argument won't help the case.
  - lazide 6y ago
    I don’t think that was the argument was it? It’s all negotiations. If you think it’s worth taking a $10k paycut for a $5k (for the business)/$12k (as an individual) health plan, then it’s win-win. If you take a $10k paycheck because you live in Nebraska (and nothing else), and the Company is in SF? That’s just bad negotiating. If the company is in Nebraska and only pays $10k less and can get plenty of takers locally - then they won’t get many people from SF, and they’re probably fine with that.

znpy 6y ago

I tend to agree with your post (how could I not, i'm on the same side of the table as you) but I cannot help but see THE fallacy in your thinking. You claim that you should be paid based on market value. You are probably speaking about the pre-covid market value. But once you open up to full-remote working... The market broadens immensely. Your "competitors" in the market are not bay-area people anymore. It's the whole US. If your company has branches in other countries too (think FAANGs) and the workforce was already spread across timezone then now most of the world is filled with potential competitors for your job. And now with a huge supply of workers, your market value decreases a lot. And to be 100% honest: as an european, if you (an american) think you're worth 250k and your employer is thinking of firing you and offering me 125k for your job... Well good luck with your next job search.

u678u 6y ago
> Your "competitors" in the market are not bay-area people anymore. It's the whole US. Agreed, not just American, anyone roughly in the same time zone. There are lots of well educated people in Peru/Chile/Brazil that would work 24hrs a day for a $25k salary.

andrepd 6y ago

But, as a certain bearded German economist once noted, the remuneration of labour is not related to the value it produces. As long as there is a reserve mass of unemployed people, that remuneration is related to the minimum that the worker needs to survive. Agree or disagree with the rest, Marx was right on the money with this one. Of course, since there is more demand than supply of qualified workers, remuneration rises above that minimum. But as long as an Indian developer is "glad" to do the same work as you for 1/4 pay...

doublejay1999 6y ago

the only question, is how long employers will continue to pay a premium based on your postcode.

lucideer 6y ago

> offensive You're really not doing the HN user stereotype of entitled valley types any favors using very personal ego-centred words such as "offensive".

Spooky23 6y ago

Weird argument. I guess you can have your freedom and live in some tent city in Palo Alto under the freeway, or live in a reasonable house anywhere else.