"Google employees who opt to work from home may earn less than they did before"/ "These people were able to take their big-city salaries to more affordable towns

Aug. 10, 2021 "Google employees who opt to work from home may earn less than they did before": Today I found this article on CBC News:

Google employees based in the same office before the pandemic could see changes in pay if they switch to working from home permanently, according to a company pay calculator seen by Reuters.

Adjusting salaries based on cost-of-living where remote workers — rather than their offices — are located is an experiment taking place across Silicon Valley, which often sets trends for large employers.

Facebook and Twitter also pay less to remote employees who move to less expensive areas. However, smaller companies including Reddit and Zillow have shifted to location-agnostic pay models, citing advantages when it comes to hiring, retention and diversity.

Alphabet Inc's Google stands out in offering employees a calculator that allows them to see the effects of a move.

Working from home could affect pay for some  

But in practice, some remote employees, especially those who commute from long distances, could experience pay cuts without changing their addresses.

"Our compensation packages have always been determined by location, and we always pay at the top of the local market based on where an employee works from," a Google spokesperson said, adding that pay will differ from city to city and state to state.

One Google employee, who asked not to be identified for fear of retaliation, typically commutes to the Seattle office from a nearby county and said they would likely see their pay cut by about 10 per cent by working from home full-time, according to estimates by the company's Work Location Tool, launched in June.

The employee was considering remote work but decided to keep going to the office — despite the two-hour commute — saying the pay cut would've been an amount similar to their last promotion.

"I didn't do all that hard work to get promoted to then take a pay cut," they said.

Policy in place for Canada, too

The compensation policy is in place for the company's Canadian work force, too, Google confirmed in a statement to CBC News.

"Whether you come into an office or work remotely, we pay at the top of the local market — which differs from city to city," the company said.

"If an employee decides to change where they work from, they have always seen an adjustment — up or down — depending on where they go," Google told CBC News.

Jake Rosenfeld, a sociology professor at Washington University in St. Louis who researches pay determination, said Google's pay structure raises questions about who will feel the impacts most acutely, including families.

"What's clear is that Google doesn't have to do this," Rosenfeld said.

"Google has paid these workers at 100 per cent of their prior wage, by definition. So it's not like they can't afford to pay their workers who choose to work remotely the same that they are used to receiving."

Calculator shows extent of pay cuts 

Screenshots of Google's internal salary calculator seen by Reuters show that an employee living in Stamford, Conn. — an hour from New York City by train — would be paid 15 per cent less if she worked from home, while a colleague from the same office living in New York City would see no cut if they worked from home.

Screenshots showed five and 10 per cent differences in the Seattle, Boston and San Francisco areas.

Interviews with Google employees indicate pay cuts as high as 25 per cent for remote work if they left San Francisco for an almost-as-expensive area of the state such as Lake Tahoe.

In its statement to CBC News, Google said it received 10,000 requests from employees to either transfer to a new office or work remotely, and 85 per cent of those requests were granted in the first round of such requests.

"We have always provided top-of-market compensation to our workforce, across salary, equity, leave, and a suite of benefits — this isn't changing as we shift to a hybrid model."

Google employees who opt to work from home may earn less than they did before | CBC News

Nov. 20, 2021 "These people were able to take their big-city salaries to more affordable towns": Today I found this article by Brandie Weikle on CBC news:

Alejandra McLatchie loves that her new home sits on two acres of land, with a pool and a chicken coop, just a 10-minute walk from a lake.

In June, she and her family moved to Upper Tantallon, N.S., about 25 minutes outside of Halifax, ditching their long commutes to downtown Toronto each day from their home with a small backyard in the suburban city of Mississauga.

McLatchie and her husband, Tyler, who both work in the insurance industry, are among what appears to be a growing number of people who have been able to relocate to smaller cities and towns in Canada, as remote work during the pandemic made their jobs — and their big-city salaries — portable.

Statistics Canada data on internal migration over the pandemic period is not yet available, but a real estate boom in Canada's smaller cities has been tied, in part, to the new freedoms of remote work.

"I never thought that I would ever have the opportunity actually to work from home five days a week, consistently, all the time," said McLatchie.

When the pandemic hit, as difficult as that time was, she said she decided to use it as an opportunity to "showcase my abilities to be able to produce the same amount, if not more, being at home remotely."

Moves like the McLatchies have raised questions about whether employees should retain the same-sized paycheques when they move to less expensive areas. 

Tech giants, including Google and Facebook, for instance, have said staff members who choose to continue working remotely after the pandemic from areas outside normal commuting distance from the office may take a cut in pay.

Good news for Canada, economist says

Still, other companies, including Shopify and numerous others in the tech industry, have said they're embracing remote work, partly as a way to retain workers with in-demand skills, while also expanding the pool of candidates.

That's good news for our country, said Tony Bonen, director of research, data and analytics for the Ottawa-based Labour Market Information Council.

"I think the move to increasing levels of flexibility for workers is good for businesses; I think it's good for workers," he said.

"In Canada's case, in particular, I think it's especially good for us, because it maybe allows people to spread out a little bit more. We have a lot of land here. And there's a big difference between the amount of people crowding into large cities versus … more remote areas that have a lot to offer, but there just haven't been jobs there."

If your job can be done just as well from a part of the country without sky-high housing costs and long commutes, Bonen said pay shouldn't change with your postal code.

"I think if you are given the flexibility, the benefit of working remotely anywhere within Canada, there's no reason why your pay should be different, depending on where you choose to live," he said. "If you live in an expensive city or a less expensive region, or a less expensive part of the city, for example, that's a personal financial choice."

Rather than claw back existing salaries when a worker moves further afield, which would cause all kinds of human resources problems and hurt employee morale, said Bonen, a fairer way to look at pay might be to offer a premium to workers who are required to live in our most expensive cities.

Necessary to compete for workers

Tying location to employment — and therefore salary — disqualifies "99 per cent of the people out there," said Greg Gunn, co-founder and CEO of Commit, a professional network that pairs software engineers who work remotely with tech startups.

That's a problem, Gunn said, given Canadian companies are competing for these workers not just with large U.S. tech firms that have set up offices here, but with small and medium-sized companies from outside the country that are interested in hiring Canadians to work remotely.

"There's a lot of arbitrary rules that we created when we were hiring people and compensating them in the past that has some necessity to it. But they're just no longer relevant in a world where geography and opportunity are becoming completely decoupled."

Gunn, who lives in Vancouver, predicts software engineering is going to be "the first completely remote career in the entire world, just because of the qualities of the profession." That includes a long history of thousands of developers collaborating on open-source software.

In fact, a number of Gunn's industry colleagues have moved northwest, from Vancouver to B.C.'s Sunshine Coast — including Commit engineer Alexandre Georges. 

He and his girlfriend were able to leave their one-bedroom apartment and buy a home in Gibsons, B.C., which would have cost three times as much in Vancouver, Georges said. Their new home is a five-minute walk from the forest and has room for Georges to brew his own beer. With a bigger kitchen, he said, "we cook a lot more, which is kind of nice."

There was never any question about whether he'd retain the same level of pay.

"I mean, in software engineering roles … there's a lot of demand from companies, a lot of startups, starting new projects," he said. "It definitely brings the salaries up; it doesn't really matter where we are, especially with big companies like Amazon, Microsoft, who can afford to pay their engineers quite a lot."

Bonen said while many jobs remain tied to location, it's not just high-tech workers who are benefiting from remote work. "For many service-sector professions, there's this move toward flexible work arrangements," he said.

Companies playing catchup

That said, pay has traditionally varied between regions in Canada. For example, in the broad category that Statistics Canada calls finance, insurance and business administration, people earn around $51,000 per year in Saskatchewan and just over $61,000 in B.C.

Afifa Siddiqui, CEO of the Toronto-based Canadian Payroll Services, said a lot of companies are playing catch-up on the issue of location and pay as a result of not having policies in place to deal with pay disparity between locations when employees asked to move during the pandemic.

"I think the first step is for companies to very clearly create these policies and communicate them to their staff, so that when someone does decide or is deciding, 'Am I going to take a salary hit,' they actually understand what the salary bands are across their company." 

In Alejandra McLatchie's case, while her wages stayed the same after moving out of the Greater Toronto Area, she said her employer did let her know that they'd typically pay $20,000 to $30,000 less for someone to do the same job in the Halifax area — "I guess making me feel extra fortunate of my position."

These people were able to take their big-city salaries to more affordable towns | CBC Radio