Cost of Living vs Cost of Labor in the post-COVID compensation world

HannahBaldovino's profile thumbnail
Hi Sofi, from what I've seen cost of living is definitely a factor. I've seen companies adjust salaries accordingly when people have decided to move out of an expensive city. For example living in Silicon Valley and then the employee decided to move out to Nevada since we're all mostly remote and there was an expectation that the salary would be reduced and in accordance with the area. That's just what I've seen, I wonder if others have seen differently.
teresaman's profile thumbnail
There was a phenomenal thread about it here with lots of diverse opinions:
isla's profile thumbnail
For whatever my opinion is worth (I'm not a C-level/founder/etc.) I would suggest basing your salary around the location of the head office, even if it's remote. If someone is looking for a job to improve their situation in life, then getting "Washington D.C." pay in Kansas City can be life-changing. Conversely, what's to stop a candidate who you hire from, say, New York, to moving to a cheaper cost of living location and pocketing the difference?
iynna's profile thumbnail
I just came here to say that your opinion is always worth it Isla (C level or not)!
amandajude's profile thumbnail
Was thinking the same thing:)
A couple of issues: (1) do you want to have to keep changing people's salaries when they move? what if they move frequently? (2) I would leave a company that reduced my pay if I chose to live in a lower cost of living area. Why? Because I might later need to take a job in a higher cost of living area and they will attempt to base my salary on whatever is my current salary, often regardless of COL. I've sometimes been asked on applications to provide my salary for each role and it's important for salary negotiations that it's always increasing. It shouldn't be that way, but it is. So, I would not accept any perceived step backwards.
amandajude's profile thumbnail
It’s pretty tough to stay focused on work when your salary is subject to change often. Sounds like a stressor for the employee for sure. What hit to have to move back home to take care of an aging parent and then take a pay cut on top of it
ellenflanagan's profile thumbnail
I have to say that @sofih, you give me hope for human race and I want to applaud you and the ELPHA platform for even having these conversations so that you can make a fair and equitable decision. Never doubt that a small group of thoughtful, committed citizens can change the world; indeed, it's the only thing that ever has. MM
Nelida24's profile thumbnail
Hi Sofi. Recently bumped into Cultivate People a startup working compensation. Their platform may be helpful.
ninabaliga's profile thumbnail
I think Buffer handles this in a really interesting way. 1) They make all their salaries public (which I think every company should be doing if we really want tackle lack of equity in the workforce). 2) They are transparent about how they calculate it (both through cost of living and through levels in the organization).3) They are regularly reevaluating this structure to find pitfalls and benefits, and communicate clearly to their employees on the "hows" and "whys" of all these decisions. They have done remote first for many years (so have enough experience and historical data to understand what remote companies means for people).