Remote work is on the rise, the economy is on a decline and businesses are re-structuring themselves around what many consider the new normal. Increasingly more organisations are opening themselves up to the possibility of working remotely beyond just the temporary measure in the fight against COVID-19. Many begin to see remote work as not only a necessary consequence, but rather as a new opportunity to diversify their workforce, increase employee productivity and cut some cost. The biggest cost saving obviously comes from office space, and not just in terms of raw square footage but also in location. When previously companies had to boast huge HQs in expensive areas, now they can spread themselves thinner across more affordable cities. Another big cost saving can come from employee salaries. A more distributed workforce and more work from home opportunities will inevitably mean a bigger talent pool competing for the same open positions, effectively giving employers a bigger choice.
However, when it comes to existing employees' salaries the direction taken by big tech companies couldn't be of starker contrast. Companies like Facebook or Twitter have made it clear that employees who choose to relocate to more affordable cities can expect big cuts to their existing salary whereas companies like Reddit announced that they won't reduce the salary of any of their 600 US workers regardless of where they live.
These recent announcements have revived a long standing debate around the topic of equal pay for equal work. Before COVID-19 GitLab has already sparked a lot of controversy around the concept of "cost of living" adjusted salaries. At GitLab two engineers who perform the exact same work could get vastly differently compensated based on where they live. It doesn't require a lot of imagination to understand that such policies can alienate a lot of good people and further contribute to the perception of an ever growing inequality gap. Personally I find cost of living adjusted salaries very problematic as they deflect from the real market forces which come into play. Those should be a decent minimum living wage and the forces of demand & supply. If someone is a professional in a niche market, a rare specialist in a scientific field or an exceptionally sought after engineer then cost of living should have no say in determining their pay. Those so called knowledge workers are often higher in demand than there is supply. A good indicator for the scarcity of one's profession is when their employer recruits talent from all across the world and advertises unique perks such as relocation bonuses, dental care or exceptional holiday packages. These benefits would not exist if there wasn't a fierce competition for a particular skill.
Regardless of the real economics at play, it still comes down to a good old negotiation where each person has to stand up for their own beliefs and reach an agreement on their pay. If you find yourself in a situation where your current salary might be at risk due to recent relocation then hopefully the following write-up can help you to negotiate equal pay for equal work. It is a curated list of relevant points to formulate a strong argument why one should receive the same or perhaps an even better pay for the same work carried out from a remote position.
Same duties, same pay
If you're reading this blog post then you're most likely not being paid for your time or place of work. You are being paid for your knowledge, your skills, your duties, the challenges which come with your work and most importantly the responsibilities of your role. Your professionalism and your personal commitment which you bring to your every day job will not diminish when you move into a new place. Whether you work remotely or not, you will still contemplate over that tough work problem in your spare time. You will still lose sleep over that big presentation the next day. You will still stay up late to meet an important deadline by the end of the month. You do it because you take pride in your work. You do it because of a sense of personal accountability to your team. It is those qualities which have earned you the trust of your manager over the years. It is those qualities which earned you a pay rise long ago. Changing postcodes doesn't take away your accomplishments from the past. Changing postcodes shouldn't take away the things which you have already earned before.
Same value, same pay
The value of your contributions hasn't been compromised by moving house. Customers still pay the same price for the products which you have helped to build. Sales figures didn't drop when you went remote. Why should your employer reduce your pay when they are not passing that cost saving onto their customers by cutting their own price? Based on the same principle why your employer won't reduce their prices when downsizing office, you also shouldn't accept a lower salary after moving place. The concept is the same and you shouldn't accept one principle for them, but another for yourself. As you continue to deliver the same value and quality as before, you equally deserve the same compensation in return.
Your savings, their savings
Let's be clear, when you transitioned from office to home it's not like you're the only one who benefited from a lower cost of living as a result. Whatever savings you might have made on your rent, your employer does now too. Every person in an office requires an extra desk. Every additional person requires a fraction more of bathroom space. More people mean bigger kitchens, bigger break out areas, more meeting rooms, larger hallways, bigger stairways and more facilities to comply with fire safety regulations. There is more pressure on lifts to avoid bottle necks during peak times. There is more building maintenance work to be done and more frequent cleaning intervals required. A bigger workforce automatically means more individual needs. Extra bicycle storage rooms, canteens, car parks, private offices, outdoor spaces, a bigger selection of refreshments and a larger variety of office perks are just a few to name. Unless your employer is prepared to share their own operational saving directly with you, why should you share your personal operational saving with them? Fundamentally their savings are theirs, and your savings are yours.
Their profit, your profit
Have you ever received a pay rise when your employer re-structured themselves to benefit from lower tax? Have you ever received a pay rise when your employer opened up a new factory in a less regulated place? Have you ever received a pay rise when your employer outsourced a call centre into a country without minimum wage? Probably not, because it was your employer and not you who took the risk. Guess what, when you are courageous enough to relocate to a different country, city or state, then any financial gains from your move are also only yours to claim. This shouldn't be a huge surprise as nothing comes without its own significant risk. Economic security, social safety nets, unemployment benefits, retirement support, access to public health services, cost of qualitative education or medical treatment are often some of the compromises which have to be taken into account. Simple things such as free playgrounds for children, access to public recreational grounds, well maintained parks, a good public transport system funded by tax or basic luxuries such as political stability or the ability to safely park a new car on a public road are many other cost calculations not to be dismissed. Of course this is not always the case, but those considerations are for you to make. Nobody else, particularly not your employer, who has a financial interest of dismissing or downplaying those issues should be making those calculations on your behalf. This is such a basic principle that it's almost offensive to suggest the opposite. Your employer should not decide what sort of lifestyle you deserve.
Higher cost, higher pay
Contrary to common belief, working from home is not cheap. First of all, working permanently from home requires an entire additional room. If your family lived in a three bedroom house before, now you need four. Thanks to COVID-19 most will agree that working from a sofa is neither practical, nor sustainable or realistic by any means. A proper office desk and a good ergonomic chair are a necessity at the least. Those requirements alone make a legitimate home office significantly more expensive than many would like to admit. Throw in a couple of monitors, a qualitative web cam, microphone, printer, shredder, peripheral devices, a whiteboard, noise cancelling headphones, a mesh router and a backup laptop (assuming you'll get a work laptop provided) then the true cost of a home office begins to reach eye watering levels.
Some employers will try to provide you those supplies, but any seasoned remote worker will tell you to decline such an offer. After all you're still equipping your own personal home. You shouldn't have to pick from a selection of office desks which don't match your walls. You shouldn't have to settle on a chair which doesn't appeal to your eye. You shouldn't have to accept a black bezelled screen when all your other equipment is in space grey. Most importantly though, you want to treat those things as your own. You don't want to change your monitors when you change your job. You don't want to have to go through your employer to make a warranty claim. You don't want to ask for permission to replace a worn out chair. Instead you want to get a pay rise which allows you to set up your home office in the most productive way. If your employer is smart enough then they will not want to manage all of that inventory (which they never get to see) either.
Speaking of inventory, the true cost of working from home does not stop there yet. When working remotely nothing disrupts productivity more than a low bandwidth internet connection. One cannot constantly have people cutting out in important meetings. Pair programming is not possible with a two second lag. Worst of it is when one cannot work at all, because their internet provider has yet another outage in a short period of time. Working professionally requires a professional internet connection, whether from an office or from home. A fibre optic connection from a reputable provider with a high SLA is often 3-4 times more expensive than what most households have today. It's a significant cost which remote workers can hardly avoid to pay.
Fibre optic is not always the holy grail though. About a year ago hundreds of London households were affected by a major outage because a residential construction site accidentally drilled into one of the main regional cables underground. Households, businesses and even entire hospitals were left without internet for several days. Now if this was to happen in a traditional office then employees would still go to work, stand by the coffee machine all day and still get paid. Meanwhile office management would go berserk and erratically try to workaround a problem which cannot be easily fixed. At some point the issue would get eventually resolved and everyone will carry on. However, if the same were to happen in a remote work environment then employees would be expected to put adequate counter measures into place. Unfortunately I was one of the households which was affected by this outage at the time. My options were to either sign up with a co-working space and work from there, or pay extra for unlimited mobile data as a backup plan. I opted for the latter as it made more sense and time has shown that exceptional cases tend to be more regular when one cannot afford for them to happen.
Finally remote workers - who essentially conduct business from home - also have to pay for a higher home insurance premium and for a significant increase in utility bills. All in all the recurring and one-off expenses are sky high and must be accounted in a remote worker's pay.
Not important then, not important now
Think back to the time when you got hired for your current role. Did anyone ask you about your cost of living then? During your interview did someone ask you about your monthly rent? I'd be surprised if this was the case. Instead you were probably asked to traverse a binary tree. You had to solve a whiteboard puzzle to justify your pay. Cost of living was never a concern. Many of your peers received the same pay before the housing market took a hike. Many of your peers might have not even paid any rent. What if someone inherited a home or bought extremely cheap a few years ago? Equal distribution was never your employer's aim. Adjusting salaries to cost of living cannot just be arbitrarily introduced when it suits your employer the most. You are not less worth when moving place.
Negotiate like a friend
Whatever one's situation is, however difficult a negotiation might be, treat people like they were your friends. Always be kind, remain friendly, negotiate in good faith and explain your thoughts and concerns with respect. The best way to achieve your goal is by getting people on your side. Make yourself a friend. Imagine if you were a manager and how far you would go yourself for someone who you respect. How many hierarchies would you fight in order to secure a valuable employee's pay? No supervisor or manager would want to lose a good employee on their team over a pay policy which is partially out of their control. People will jump through those hoops if you stand up for yourself in a positive and friendly way. Don't underestimate what an amicable negotiation can achieve. A hostile negotiator can only get what the other party has to give. A friendly negotiator however can get things which others thought were not even up for debate.