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With remote work plan, Facebook dashes hopes of paycheck arbitrage

347 pointsby rdslwalmost 5 years ago

98 comments

dangalmost 5 years ago
Remote work threads have been the biggest cliché of HN since the pandemic (and were one of the bigger ones already), and arguing about location-based salaries has been the biggest cliché of remote-work threads lately. So normally this follow-up post would get a moderation downweight (<a href="https:&#x2F;&#x2F;hn.algolia.com&#x2F;?dateRange=all&amp;page=0&amp;prefix=true&amp;query=by%3Adang%20follow-up&amp;sort=byDate&amp;type=comment" rel="nofollow">https:&#x2F;&#x2F;hn.algolia.com&#x2F;?dateRange=all&amp;page=0&amp;prefix=true&amp;que...</a>). But I&#x27;m lessening the downweight because it seems to me this bit may count as SNI (Significant New Information):<p><i>Employees who attempt to wiggle around those compensation adjustments will be subject to “severe ramifications,” [Zuckerberg] said, as the company needs to account for employee locations to avoid violating tax laws. Zuckerberg said Facebook will monitor adherence by checking where employees access its VPN. Facebook also uses its own apps&#x27; to track employee locations, according to CNBC [...]</i><p>(See <a href="https:&#x2F;&#x2F;hn.algolia.com&#x2F;?dateRange=all&amp;page=0&amp;prefix=false&amp;query=by%3Adang%20%22significant%20new%20information%22&amp;sort=byDate&amp;type=comment" rel="nofollow">https:&#x2F;&#x2F;hn.algolia.com&#x2F;?dateRange=all&amp;page=0&amp;prefix=false&amp;qu...</a> about SNI.)
lootsaucealmost 5 years ago
This is a very subjective thought experiment and I&#x27;m sure you could make all kinds of arguments against it but here goes...<p>Imagine person A lives in an area with a high cost of living and gets full salary. Person A is able to purchase a house at a high valuation relative to the national average. Person B in a rural area is able to buy perhaps as nice a house on a smaller salary in a below average market.<p>Now look at the options available to these two people when they want to move. Person A sells at market rate or perhaps a little below and can move to a lower cost of living with a relatively large pile of cash. Person B has no such option. The real estate market arbitrage is available to person A and not to person B.<p>The salary of person A looks like it produces options and upward mobility. The salary for person B seems to have more limitations.
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mtviewdavealmost 5 years ago
Here&#x27;s a thought experiment. Let&#x27;s say an employer is based out of downtown San Jose, and employs people on-site. Would it be reasonable for them to adjust salaries depending on what city an employee lived in? The average rent for a one-bedroom apartment is $3,291 in Mountain View, but $2,390 in Morgan Hill. If an employee moved from Mountain View to Morgan Hill, would the employer be justified in reducing the salary of the employee to adjust for the fact that the (on-site!) employee now lives in a lower cost-of-living area? (Let&#x27;s assume that other CoL factors are not more expensive in Morgan Hill than Mountain View, which I feel is a safe assumption).<p>Would it be justified if the company was fully remote?<p>What about if the employee moved to Sunnyvale? The average rent is $3,016; a smaller difference, but still cheaper than Mountain View.
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rayineralmost 5 years ago
The lawsuits around this are going to be amazing. African American developer has kids and moves to Georgia to be near family; receives steep pay cut compared to white developers who move to Connecticut to do the same.<p>And how does Facebook decide what the cost of living in your area is, anyway? The more data-driven Facebook makes that calculation, the more delicious the law suit gets. For example, DC is a fairly high cost of living Metro area, but there are some nice suburbs in PG County 30-45 minutes east of the city that are quite affordable. They’re also predominantly African American. Does Facebook set your salary based on living in the DC metro area, or do they drill down further and cut your pay for living in PG County? I can’t wait to see what happens.
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tasty_freezealmost 5 years ago
When I moved from SF bay area to Austin, my employer didn&#x27;t lower my salary, but for a few years my yearly increases were small compared to my performance review until my pay grade was right for my pay grade and location combination.<p>This was a nice way to do it because my salary has always been monotonically increasing, and I wasn&#x27;t offended that my increases were small for a few years because I knew why it was happening.
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sschuelleralmost 5 years ago
Well a Swiss court just ruled that companies need to compensate (including part of the rent) employees if they are home officed. [1]<p>Companies taking advantage of this and thinking they can save money should think again.<p>[1] <a href="https:&#x2F;&#x2F;www.google.com&#x2F;amp&#x2F;s&#x2F;www.nzz.ch&#x2F;amp&#x2F;schweiz&#x2F;arbeitgeber-muessen-einen-teil-der-wohnungsmiete-uebernehmen-wenn-sie-ihre-mitarbeiter-ins-home-office-schicken-ld.1557921" rel="nofollow">https:&#x2F;&#x2F;www.google.com&#x2F;amp&#x2F;s&#x2F;www.nzz.ch&#x2F;amp&#x2F;schweiz&#x2F;arbeitge...</a>
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supportlocal4halmost 5 years ago
It is generally-expected behavior for an automaker to shift production to the cheapest labor market. Well, maybe not the absolute cheapest. Cost of goods transport, e.t.c. also factor in. But it doesn&#x27;t surprise anyone for manufacturers to open factories in locations that lower their costs. It&#x27;s an obvious thing to do.<p>So it has always baffled me that tech companies do the exact opposite. They motivate the most skilled people to leave low-cost areas and move to the most expensive. They pile them in higher and higher and keep driving their own labor costs through the roof. And VCs exacerbate the problem by refusing to fund anything in less expensive locations.<p>It&#x27;s easy to dismiss this as irrational. But is it really? Are there benefits to this that are so huge they outweigh the costs?<p>If you could pay $10,000,000 to move 1000 devs to Kingman, AZ, then cut their avg salary from $250,000 to $150,000, why wouldn&#x27;t you do that? What is the downside to saving $90,000,000 after moving expenses in the first year alone?<p>The obvious first argument is reduction in the standard of living would cause the talented to refuse. I&#x27;m sensitive to this, but also skeptical. People making 150 in Kingman would improve their SOL.<p>I could be wrong, but I think there are more important factors. I think there is too much money at stake for these employers to have not thought it through. When a common behavior looks insanely irrational, it is more likely that you haven&#x27;t seen all the variables.
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Tade0almost 5 years ago
Coming from a country(Poland) that may well be treated as one large outsourcing company (with the notable exception of CDPR and its whopping 1200 employees) here&#x27;s my prediction on how this is going to play out:<p>Salaries of remote employees will initially be made much lower according to some woefully inaccurate estimate of cost of living, but from that point on they will increase at a considerably faster rate than normal.<p>Within a decade they will stabilise at a visibly lower than SV, yet still high level representing the true difference in cost of living - or actually - &quot;cost of deciding not to live in SV&quot;.<p>Eastern Europe experienced an amazing advance in IT compensations when the west figured out that the software engineers there are no worse than their local counterparts.<p>In the case of SV&#x27;s surroundings it&#x27;s obvious that the engineers are talented, so I believe this process should be starting just now.<p>Overall it&#x27;s not that bad, because with time any incentive to move back to the high cost of living area fades.<p>You won&#x27;t be driving Teslas to work(chiefly because you won&#x27;t be driving), but you&#x27;ll enjoy a standard of living higher than a person employed in a local company, and that is nothing to sneer at.
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VonGuardalmost 5 years ago
This makes sense in the hiring process, but once you&#x27;ve hired someone, it&#x27;s a super dick move to lower their salary in spite of their performance. Seems like the sort of decision a robot would make.
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gruezalmost 5 years ago
&gt;Zuckerberg said Facebook will monitor adherence by checking where employees access its VPN. Facebook also uses its own apps&#x27; to track employee locations, according to CNBC<p>So all I need to do paycheck arbitrage is to use a VPN with private residential IP (yes, that&#x27;s a thing), and a rooted&#x2F;jailbroken phone that does location spoofing?
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habosaalmost 5 years ago
Where did Facebook say that &quot;cost of living&quot; will impact salaries? At Google (where I work) salaries vary a lot based on location but cost of living is not part of the equation. It&#x27;s based on the cost of hiring in the market.<p>I&#x27;m personally in the middle of an SF to London transfer. I&#x27;m taking a 25% pay cut. That is not because it&#x27;s cheap to live in London (it&#x27;s not) but rather because it&#x27;s very very cheap to hire developers there.<p>I imagine Facebook will do something similar.
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gojomoalmost 5 years ago
California might consider making this sort of practice illegal, in the same way they&#x27;ve prohibited requiring a salary history, or enforcing certain non-compete agreements.<p>Why? It&#x27;s salary discrimination based on a tangential factor that arguably has no effect on the quality-of-work delivered.<p>To the extent an employer has the power to demand such a disclosure, it&#x27;s suggestive of market-concentration &amp; a lack of competition, that prevents an employee&#x27;s skills, and skills alone, from determining their compensation.<p>(And, a possible added bonus for California would be that requiring big employers to pay California salaries, even to non-California employees, might deter those employers from seeking such California-tax-base-eroding arrangements.)
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noizejoyalmost 5 years ago
I find it quite counter-intuitive that there would be different salary levels for remote employees depending on the location they live in, since for remote employees the location is now presumably their choice, and not the employer&#x27;s - analogous to the personal choice of how expensive the employee&#x27;s choice of dwelling is.<p>As others have mentioned, anything else runs the danger of creating potentially perverse incentives to move (fake or real) to a more expensive location, thus adding cost to the employer. And when salary costs for some go up, the argument could be made it lowers the pot of total salary money available for the remaining employees, since many large employers are managed to hit overall percentage targets for various cost items (like R&amp;D which for web companies typically has a considerable salary component).<p>The whole thing sure sounds like a classic large company policy with unintended consequences. -- Running large companies is hard.
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Smooshalmost 5 years ago
&gt; Facebook also uses its own apps&#x27; to track employee locations<p>Not unexpected, but another reason not to work there.
Consultant32452almost 5 years ago
I&#x27;ve worked remotely for 10+ years and I have one piece of advice. Ignore these policies. Live wherever you want and demand whatever salary you think you&#x27;re producing at. If FB wants to leave high productivity labor on the table, let them. If any company has any kind of policy that stops them from hiring you, that&#x27;s their problem. We&#x27;ve been in a seller&#x27;s market for software development labor for nearly 20 years. Stop pretending like these arbitrary rules are your problem, it&#x27;s theirs. They can&#x27;t limit you. They can only limit themselves.
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adammunichalmost 5 years ago
If your method of motivating people is &quot;severe ramifications&quot; maybe it&#x27;s time to chill for a while and go fishing.
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ChuckMcMalmost 5 years ago
I understand this, although I disagree with the notion that a job is worth &quot;more&quot; in a high rent area than it is in a low rent area. But that is a different thread.<p>That said, when my kids were in school there was a phenomena that &quot;Cupertino Schools are the best public schools&quot; so parents wanted their kids to go to those schools. Which you could do if you lived in Cupertino, but Cupertino has higher costs than say living in South San Jose. So creative parents would make their &quot;home&quot; one of the apartments run by a &quot;friendly&quot; landlord who would &quot;rent&quot; them an apartment for $100&#x2F;month, and give them a utility bill with their name on it so that the student could claim Cupertino residency and go to Cupertino schools. Other scams involved people offering to pay the utilities for someone who lived in Cupertino so that they could get that precious document which saved them $8,000 a year or more on private school tuition.<p>Depending on the difference in salary, I would not be surprised to see some of that action going on with regards to people&#x27;s &quot;Facebook home&quot;
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daenzalmost 5 years ago
Here in Washington, a Seattle salary of $150k is worth around $315k in Spokane. And that&#x27;s in the same state.<p><a href="https:&#x2F;&#x2F;www.bestplaces.net&#x2F;cost-of-living&#x2F;spokane-wa&#x2F;seattle-wa&#x2F;150000" rel="nofollow">https:&#x2F;&#x2F;www.bestplaces.net&#x2F;cost-of-living&#x2F;spokane-wa&#x2F;seattle...</a>
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B-Conalmost 5 years ago
&gt; The biggest loser, he predicted, would be California.<p>California had been downtown hostile to the tech industry and grown complacent work the status quo because the tech workers had to be there. If tech workers don&#x27;t have to be there, they will start trickling out.<p>CA worked hard to make the bed they&#x27;re about to lie in.
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BrandiATMuhkuhalmost 5 years ago
GitLab seem to be very open about that. They have a salary calculator that includes the location. <a href="https:&#x2F;&#x2F;about.gitlab.com&#x2F;handbook&#x2F;total-rewards&#x2F;compensation&#x2F;compensation-calculator&#x2F;calculator&#x2F;" rel="nofollow">https:&#x2F;&#x2F;about.gitlab.com&#x2F;handbook&#x2F;total-rewards&#x2F;compensation...</a>
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eanzenbergalmost 5 years ago
Piggybacking. This should be no surprise. When your job becomes remote, you now compete with people willing to earn half or less because they choose not to live where you do. Basic econ. Don’t be entitled, it’s no surprise most of the country hates tech workers.
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rkochmanalmost 5 years ago
I’m waiting for this to be framed as a racial equity issue. Are they really going to pay people in Detroit and Atlanta less than people in San Francisco and Seattle for the same job in the same “virtual” location?
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christiansakaialmost 5 years ago
I can smell the next SaaS offering: pobox.me, rent a po box and real address and take your salary to the next level!
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nuggetalmost 5 years ago
If a developer is 100% wfh and productive, who cares where they live? FB&#x27;s stance would seem to alienate the technical talent that they spend a fortune to recruit, train, and keep motivated. Not to mention make anyone who wants to move an easy target for competitors to poach.<p>Edit: Of course the IRS should care, and employers should want to accurately report domicile. His statement came across as the company being more worried about the exploitation of a corporate compensation loophole than adherence with tax law. Maybe they saw so much initial interest in relocating that they felt they had to pour some cold water on it.
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taurathalmost 5 years ago
What a great way to make people rush to the cheapest and least convenient parts of the highest income areas, further displacing poor people.
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Joofalmost 5 years ago
I live in a van. Does that mean I&#x27;m working around compensation adjustments?
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webkikealmost 5 years ago
I’m currently living rent free at my parents place in Palo Alto. Can you imagine how much more Facebook would pay me than someone renting in a poorer neighborhood?
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toadialmost 5 years ago
I have have worked as freelance contractor for most of my career. In my country 80% of decent IT people do this. We can demand higher income because our contracts only last 3 months so it&#x27;s easy to lay us off when we are not needed (we have strong labor laws and employees are costly even on top of their salary). Due to this we can demand more salary too. My price goes up for short term prospect contracts, long distance of travel, I&#x27;m not particular interested in the project, ... In good times that works great but you better save some of that money for bad times.<p>I have build a good reputations so employers were ok with me working remote. So I could discount a bit as I didn&#x27;t have to do long distance travel and because it was better for me. I also took the time to move to a lower cost of living country. Was nice, but the timezone was not that interesting.<p>Currently I don&#x27;t work for my home country anymore. I work locally, apparently they pay well for my expertise here. Still I could edge out a few percentages more in my home country. But with the lower cost of living I still have more money in the bank at the end of the month.<p>If you can&#x27;t do som form of paycheck arbitrage why would you move? Doesn&#x27;t mean you need to have same salaries like you had before, you can take a small haircut. But just making the same as people locally? In my case that would be the salary I had when I just came out of school 23 years ago.
jrs235almost 5 years ago
SV companies are evaluating their employee&#x27;s BATNA. And if more tech companies are going this route, everyone&#x27;s BATNA is decreasing. They don&#x27;t want to overpay an &quot;employee&#x27;s market&quot;. It isn&#x27;t just about the value an employee brings to the company when working in SV or the middle of Nebraska. It&#x27;s turning into a buyer&#x27;s market for tech jobs.<p>Many people would be&#x2F;will be&#x2F;are pissed when a company eliminates remote positions and suddenly require employees to report to an office.
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bengalealmost 5 years ago
Seems like a weird take on what a salary is to me. I don&#x27;t know if this is an American thing, and linked to the way your benefits work, like health cover. But I don&#x27;t see my employer as having any reason to know where I&#x27;m located (beyond timezone issues for working hours), or what lifestyle I support with the money they pay me. My salary is based on what price the market will bare for the services I provide, what I do with that money isn&#x27;t really any of their business.
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vegetablepotpiealmost 5 years ago
If the scaling is proportional to cost of living I don’t think much would change. Why would an employee move away from a large city with amenities, culture, and the career advancement opportunities that come from being in an office for a drop in salary? The only advantage I can see to moving is if you’re starting a family and you don’t want to live in the city.<p>Facebook is basically telling its employees that they want them to come into the office.
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motohagiographyalmost 5 years ago
Paying a salary based on someone&#x27;s location is utter horseshit, unless they are an unskilled replaceable commodity. So at facebook, which is it?<p>It&#x27;s as though people think that they are paid out of some kind of sense of paternalistic fairness. It&#x27;s leverage, and if a recruiter can tell you &quot;well the cost of living in your area is %30 lower, therefore your work is %30 less valuable&quot; and you believe them, then sure, you are worth %30 less. If an HR person says, &quot;our policy is we pay less in the area you live,&quot; you can respond with, &quot;that&#x27;s really interesting, my policy is GFY, because I work where I deliver value.&quot;<p>Employers do not pay for your time, they pay you for theirs, to shorten the period between their investment and the maximum yield it can return to them.<p>Facebook is no longer mainly solving growth problems, it is solving sustainability and optimization problems, and if you want do do that, you might as well go work at a bank. They haven&#x27;t dashed the hope of paycheck arbitrage, they have just made a huge public commitment to inferior talent, and they deserve what they get.
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baxtralmost 5 years ago
This will accrue many negative comments here. I have to say that I can understand the reasoning behind this. I think it’s fair. I would expect that they increase the salary if you move to a more expensive place.
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ralmidanialmost 5 years ago
While tying paychecks to cost of living may appear to be equitable at a surface level, in reality you end up rewarding some workers who insist on living in an expensive area and, in a sense, force those who are willing to live in less expensive areas to subsidize their colleagues’ expensive lifestyles.
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rkochmanalmost 5 years ago
Zuck can do whatever he thinks is “fair” but ultimately he has to deal with the realities of the labor market, which will change if remote works really catches on.
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d_burfootalmost 5 years ago
&gt; company needs to account for employee locations to avoid violating tax laws<p>Serious question: can some tax-savvy individual explain what the relevant tax laws are? How much could a worker&#x27;s tax residence affect the corporation&#x27;s tax liability?
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megaframealmost 5 years ago
&gt; ...salaries will be adjusted to reflect the local cost of living.<p>So if the employee where to move to say Hong Kong where cost of living is higher will they also in turn increase wages? I think not.<p>If they keep a local address in some random apartment they never stay at but live elsewhere how would one check on that?<p>If you&#x27;re willing to pay California taxes but live elsewhere I find it hard to see how they&#x27;d plan to enforce this. You could always argue you were temporarily traveling hence the local address you intended to return to and pay taxes at. Friends of mine do this, returning to the US every 6 months or so.
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adrralmost 5 years ago
Is it required by law so the employer pays the appropriate payroll tax and abides by local labor laws?
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empath75almost 5 years ago
If we’re moving to a remote first world, long term it will flatten out salaries regardless of location, but short term, companies will stop hiring in expensive locations as much.
paganelalmost 5 years ago
&gt; Facebook also uses its own apps&#x27; to track employee locations, according to CNBC here one time using the data to find interns who failed to show up for work.<p>Is this legal?
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thrillalmost 5 years ago
Cost of living adjustments should only be allowed to be applied if the location is directed by the company.
daenzalmost 5 years ago
Are we going to see a exodus of high-income newly-remote workers to lower-income locations? This seems devastating to cities that have become dependent on the economic power these workers bring, but at the same time, it could bring new life to poorer areas of the country.
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KoftaBobalmost 5 years ago
There&#x27;s another half of this phenomenon that seems to get ignored. Yes, allowing remote work greatly increases a company&#x27;s supply of potential employees.<p>However, if more and more companies offer remote work as an option, that means employees now have a greatly increased supply of companies competing for them as well.<p>The software engineer living in Ohio who doesn&#x27;t have the option&#x2F;ability to move to a tech hub like SF or NYC would&#x27;ve typically had to make due with the small pool of positions available to them locally, meaning less leverage for salary.<p>If more companies allow remote however, they can now work at any of those, and the local companies will suddenly be forced to compete for talent.
staredalmost 5 years ago
Does it work both ways? If so, here is a cheat sheet: <a href="https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;List_of_countries_by_GDP_(nominal)_per_capita" rel="nofollow">https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;List_of_countries_by_GDP_(nomi...</a><p>Enjoy!
nmstokeralmost 5 years ago
I&#x27;m pretty sure this would be illegal in the UK, the job pays what it pays and where you live shouldn&#x27;t be a concern of the employer (the exception being if they base you abroad and you get relocation taken into account).
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Trasteralmost 5 years ago
&gt;Employees who attempt to wiggle around those compensation adjustments will be subject to “severe ramifications,” he said, as the company needs to account for employee locations to avoid violating tax laws.<p>&gt;Zuckerberg said Facebook will monitor adherence by checking where employees access its VPN.<p>Do you think facebook employees respond well to these sorts of threats? Do you think I&#x27;ll get a call from HR when I go visit my parents and log in from their house for a couple of days? I&#x27;ve got an idea, we can fit each of the facebook engineers with an ankle tracker like those guys on parole. Can&#x27;t be too careful.
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bob33212almost 5 years ago
Companies: We are paying you as little as we can get away with. Sorry that is just how capitalism works.<p>Employees: Sounds good. We will work as little as possible.<p>Companies: Wait a minute here. We are a family and a team. You need to support the team and the mission, even if that means working extra hours without extra pay.
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maximentealmost 5 years ago
it is absolutely precious to see software engineers wake up to the reality that they are, at the end of the day, plain ol&#x27; labor and are thus treated like labor when capital gets itself moving in a particular direction.<p>all of the attempts to rationalize this as fair or unfair are not useful - i&#x27;m guessing most SWEs will accept big salary cuts to work from wherever they want in the country. hell, a large portion of the SWE crowd is willing to distribute their labor &#x2F;for free&#x2F; in the form of FLOSS, so i have no doubt that they will not hold the line in any sense if big tech starts implementing this in earnest. add to that fears of another tech recession (e.g. VC money drying up) and mean big tech SWE salary may drop a fair chunk.<p>anyway, on the plus side, there may be a large cadre of talent available on the cheap - seniors willing to work remotely on a more mission-oriented project from their bungalow in Ohio. so it&#x27;s probably a great time to start a software company, or might be shortly.
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ytersalmost 5 years ago
With so many jobs switching to remote work, what is to stop employees from simultaneously working multiple jobs at once? Not that they probably don&#x27;t already, but it becomes even easier once many high paying jobs are remote. Plus, they can outsource a lot of it, so employees become mini software dev houses in their own right. Then one guy snaps up all the top positions because he is a 1000x developer due to his keen outsourcing sense. Etc.
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Markoffalmost 5 years ago
Pretty insane, as if people were not doing same job regardless of where they choose to live. I understand you must offer competitive salary based on location when hiring for on site job, since workers and company is fighting against local competition, but at WFH you are literally fighting with everyone everywhere, so the salary should be fixed for everyone instead punishing more frugal people who choose to live in cheaper location.
m0zgalmost 5 years ago
Seems like there&#x27;s still MASSIVE room for arbitrage, just maybe not as massive as what people were hoping for. I.e. as long as you live in CA (which is not uniformly unaffordable) it&#x27;ll be difficult for Zuck to argue that you should make a lot less. The price differential between &quot;half an hour commute to the office&quot; and &quot;two hours one way&quot; can be pretty staggering.
jimkleiberalmost 5 years ago
I wish instead of trying to force us to live in one place because of geographic tax laws, we would talk about reforming geographic tax (and other) laws.
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kenalmost 5 years ago
&gt; The company, one of Silicon Valley’s biggest employers, is giving U.S. staffers who are approved to work remotely until Jan. 1, 2021 to update the company on where they plan to base themselves, at which point their salaries will be adjusted to reflect the local cost of living.<p>So it’s about maintaining control over employees, not managing company expenses. You may be this successful, no more.
microcolonelalmost 5 years ago
But salaries aren&#x27;t a living allowance for living near the office, they&#x27;re what you negotiate with your employer as compensation for your work.<p>It&#x27;s your business whether that&#x27;s a lot or just enough for where you live.<p>If your company cuts your pay because you moved, even though you already worked remotely with the same working hours, you have some deficiencies in your relationship to work out.
pipeworkalmost 5 years ago
If facebook employees can&#x27;t figure out some way to... I don&#x27;t know, &quot;Connect with friends, family and other people you know. Share photos and videos, send messages and get updates&quot; they&#x27;d be able to organize and solve their problems.<p>There&#x27;s an incredible power in &quot;No&quot;, but most of us aren&#x27;t French and know very little about how to handle kings.
btbuildemalmost 5 years ago
I wonder how that salary adjustment will actually play out. If they drop salaries to location average, they&#x27;ll still have to compete with other companies (and not just local, many other remote jobs too).<p>You could work for Initech in your locale, or FANG remotely, and the salary would be the same. Would Initech have to raise their pay, or would the FANG jobs suddenly be too demanding for what they pay?
u801ealmost 5 years ago
&gt; Employees who attempt to wiggle around those compensation adjustments will be subject to “severe ramifications,” he said, as the company needs to account for employee locations to avoid violating tax laws.<p>I guess it depends on the state, but if you decide to not have any taxes withheld from your paycheck and just make quarterly tax payments, then is particular assertion true?
aremoteworkeralmost 5 years ago
Confused why remote location matters for pay (from a tax&#x2F;legal standpoint, I understand it from a cost of living standpoint).<p>I work for a company that has remote workers all in different states across the US and they (developers) are all on one shared pay scale <i>without</i> different pays per location and they just pay state taxes in whatever state they choose to live in.
tjbiddlealmost 5 years ago
Bit of a bummer - This is precisely what I was doing pretty much my whole tech career:<p>First landed a job in California, turned it into a remote gig, and then all jobs thereafter were remote with either NYC or SF pay while I bummed around in very LCOL places like Bali.<p>Already moved on to other pastures, but a bit sad to know that fallback isn&#x27;t there any longer. Ah well.
seasoupalmost 5 years ago
The warm, sunny states with affordable housing and zero taxes will see an influx of educated, rich workers. States will need to cut taxes to keep up,”<p>Or maybe, just maybe, the zero tax states will need to raise taxes to support all the infrastructure costs that come with a growing population? High tax states aren’t high tax just because...
untilHellbannedalmost 5 years ago
will be interesting to see the salary hacks employees come up with
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timwaaghalmost 5 years ago
And so it begins, the downsizing of sillicon valley level salaries. Soon enough, they will be encouraging remote employees to move to inexpensive locations. Then they will start evaluating whether employees who come to office need to be there or can be encouraged to go remote.
paulryanrogersalmost 5 years ago
One way I&#x27;ve heard the company thinking explained is replacement cost. When a valuable employee gets a better offer a company suddenly may be willing to pay more for the same person, regardless of location. Now if they can replace that person without spending more then they will.<p>There is no loyalty.
willart4foodalmost 5 years ago
This is an issued that existed before COVID-19, more so now.<p>Here&#x27;s the thing: what prevents someone from moving after taking a job that allows for &quot;remote work&quot;? And - more importantly - what would be the repercussions should someone be found out?<p>My guess is that the risk is worth the money.
j0hnmlalmost 5 years ago
As someone who is considering asking for the first time to move out of my high CoL area to be fully remote, does anyone have any advice on what to expect and how to navigate said conversation? It’s a bit nerve-wracking to think about and I want to be best prepared.
slykaralmost 5 years ago
To be fair, you should be getting a proper adjustment for working from home, because the cost of the office is now on you. You use your own chair, desk, computer, living space, etc. So a % of your rent monthly + few $k on start as a care package.
whateveracctalmost 5 years ago
I wonder what the granularity is? Can I move to a WA area with middling CoL and benefit from that Seattle-derived salary bump? If they take issue you could make the claim that you would normally commute to Seattle so you deserve the Seattle remote rate.
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xtatalmost 5 years ago
So basically employees outside the valley subsidize the rents of those that decide to stay. Who&#x27;s gonna fall for this?
Donaldalmost 5 years ago
Using their own app to track their employees&#x27; location sounds very dystopian, and potentially complicates the lives of employees without a clear location but who have established a residence for tax purposes.
BurningFrogalmost 5 years ago
Until FB publishes how they&#x27;ll set wages in different locations, discussion about the policy is pretty much useless. Since the actual policy is unknown.<p>Not that that has ever stopped an online debate before :)
holografixalmost 5 years ago
I’m struggling to see how this will promote remote work arrangements. Perhaps that’s the exact intention? “If you think you can stop coming into the office to save time and money we’ll cut your pay”?
ArtDevalmost 5 years ago
Location-based salaries is offensive and just plain wrong. Monitoring where employees login from, so the company can cut costs, seems typical of a company like Facebook.. but still makes me mad.
dba7dbaalmost 5 years ago
I&#x27;m thinking why not move to Hawaii or a beach town 1hr - 2hr north or south of Santa Monica CA? Quality of life will improve vastly for those who can afford to do so.
zrailalmost 5 years ago
Ultimately if you’re working for salary your pay is at the whim of your employer. If you want to make real money as a remote worker then switch to consulting.
sys_64738almost 5 years ago
I&#x27;m surprised FB would need to ask workers to provide this information given FB usually knows more about an individual than the individual does.
chris123almost 5 years ago
Locality Pay if standard. The federal government had been doing it for decades. Base pay plus locality adjustment based on where you live.
russellbeattiealmost 5 years ago
It says quite a lot about Facebook&#x27;s culture and employees that they felt the need to be so explicit and public about this issue. Normally, this would be talked about on an individual basis, or an internal HR memo once it was determined there was an actual issue.<p>At Facebook, they apparently are so worried about their employees lack of ethics as a whole, they felt the need to just immediately threaten the entire company. From what we all know of Zuckerberg and Facebook, this shouldn&#x27;t be surprising, but it&#x27;s amazing to see it confirmed.
rmcalmost 5 years ago
Facebook employees should talk to their union about this.
Simulacraalmost 5 years ago
&quot;...because at the end of the day, do not pay the employee any more than absolutely necessary.&quot; - Facebook Executive, probably.
mrfusionalmost 5 years ago
What if I work in San Jose but life in a van? Why do I get a high salary but someone in a house in Ohio gets a lower salary?
egypturnashalmost 5 years ago
I bet this is a thing a union would help with!
xtatalmost 5 years ago
Easy- don&#x27;t work for facebook. I have worked inside and outside the valley and never had a comp change
znpyalmost 5 years ago
What&#x27;s the problem? Leave Facebook and join another company that doesn&#x27;t apply such stupid rules.
aianusalmost 5 years ago
Still win-win depending on how much they scale.<p>$50k&#x2F;year in Thailand or Vietnam is way more luxurious than $200k in SF.
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harrisonjacksonalmost 5 years ago
How will this work for digital nomads? Same as wherever they pay state taxes, I guess.
Khelavasteralmost 5 years ago
So, employees can move to rural, inexpensive parts of northeast California?
booleandilemmaalmost 5 years ago
So no working for Facebook and moving to Vietnam to live like a king then.
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booleandilemmaalmost 5 years ago
Does this apply to both managers and engineers?
vidanayalmost 5 years ago
So there are going to be 20,000 engineers with their home in Malibu through a dead drop address and living almost anywhere else.
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buboardalmost 5 years ago
.
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ikeboyalmost 5 years ago
One of my pet peeves is misuse of the term arbitrage. It in no way applies here.
fogettialmost 5 years ago
Sarcasm on <i>Offshoring is only allowed for corporations, not for employees. What did those pesky peasants think?</i> Sarcasm off
buboardalmost 5 years ago
stage of grief: denial
cracker_jacksalmost 5 years ago
Is there any transparency on how &quot;a moderation downweight&quot; works? It sounds like a useful feature, but what does it exactly do, and is there a public log for these types of things.
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lonelappdealmost 5 years ago
That&#x27;s SNI for the article, but not Significant New Discussion in the comments.<p>I always wondered though, why not let these flamebait discussion topics stay up as a Honeypot to keep the other threads cleaner?
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aphextronalmost 5 years ago
Who on earth actually wants to work for a company like this?
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iandanforthalmost 5 years ago
This is wage discrimination. The problem is that it is, so far, legal discrimination.<p>If an employee gets married, is that a legal reason to cut their salary? No.<p>If an employee has a child, is that a legal reason to cut their salary? No.<p>If an employee comes out as gay, or updates their gender identity, is that a legal reason to cut their salary? No.<p>The first two could logically be tied to decreases in productivity, but even if it <i>did</i> decrease a workers productivity you can&#x27;t cut their salary. It&#x27;s illegal.<p>So what&#x27;s the real problem here? Taxes.<p>Let&#x27;s say that we correctly argue that the product of ones output should be compensated at the agreed upon rate and that if efficiencies of production are found by the producer they are under no obligation to 1. Disclose that fact or 2. Pass on savings to their customer.<p>Despite the fact that this is logically and economically sound the <i>reality</i> is that legislators will balk at legislation which would make their state less economically attractive. Convincing them is not an impossible task, but it&#x27;s a hard one.<p>The principle of &quot;equal pay for equal work&quot; is not naturally embraced by industry. Almost any distinguishing characteristic that could be used as an excuse to reduce wages has been used to do so. Laws championed by labor movements have been the only way to curb the natural tendencies of companies.<p>So is it normal and natural for a capitalist CEO to take this position? Yes. The moral and logical ramifications have little power. It&#x27;s only when those ramifications are instantiated by law advocated for by impacted populations that we should expect change.
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one2knowalmost 5 years ago
Facebook is afraid of a Facebook Boise office , Facebook Salt Lake City office, Facebook Houston office, etc. Their office locations are based on the political preferences of their board members and management. With no offices, they can&#x27;t control the political makeup of the company.
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