
How to Pay Remote Workers - rusrushal13
https://npf.io/2019/07/how-to-pay-remote-workers/
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gjulianm
Salaries based on cost of living are always a mistery to me. If the company
wants to have an honest relationship with the worker, the salary should be
based on the value the employee is bringing, and that does not depend on where
they live. Tying the salary to the cost of living looks like a way to cheat a
worker out of the value they generate.

~~~
cyborgx7
>Tying the salary to the cost of living looks like a way to cheat a worker out
of the value they generate.

Where do you think profits come from? Profit is the difference between what
you pay your workers and the value of their work.

~~~
oAlbe
That's not the point though. Having an honest relationship with your employees
and treating everybody fairly doesn't prevent you from profiting.

It think this point is explained really well in the article: why should
someone who lives in a city with a high cost of living be paid more than
someone who lives in a low cost of living one? Effectively, what you are doing
is giving the person in, say, SF, more money to be able to afford a better
lifestyle than the person in rural Ohio (to use the same example of the
article). Why is that fair? And also, if that is fair, then is me moving to
live on a yacht in Montecarlo a reason for the company to pay me 500k a year
to afford that lifestyle?

Workers should be paid fairly. And to do that you have to pay everybody the
highest salary you are paying for that position. I think Stackoverflow does
that now, I remember reading an article on their blog about it.

~~~
spurdoman77
But as an employer, why I should strive for honestness? Does it bring me more
profit? To me it sounds like paying too much. I pay market rates which doesnt
consider cost of living or value produced, but the the average salary for the
skillset/experience.

~~~
oAlbe
> But as an employer, why I should strive for honestness?

In an ideal world, you would because you would care for people. If not
_everybody_ , at least the people around you. As an employer, you are hiring
people who will spend the majority of their waking hours working for you, with
you, at your company. In theory, you would care if they are happy or not,
motivated or not, paid fairly or not. You would care if they can afford that
visit to the doctor they need, if they are taking enough breaks, enough time
off. Ideally, you would keep an eye on your employees to make sure nobody is
overdoing, to watch out for for employees whose performance is going down and
figure out if they are getting burnt out or what's actually going on. All
those things would pay back in the end. Happy employees do better works. Burnt
out employees don't. Recovering from that is hard, and even though you can say
"who cares, I'll fire them and hire someone else", there's still the fact that
the hiring process is expensive.

In an idea world though. But I guess I do understand that for many people the
only thing that matters is squeezing as much money for their business out of
society as they can get away with. Though, this becomes a somewhat
philosophical discussion at this point, and I think that's beside the point.

~~~
cyborgx7
If people were driven because they care about other/all people rather than
about their own material benefit, we wouldn't have designed a system based on
the profit motive in the first place. Because it wouldn't have motivated
people.

~~~
gjulianm
Profits and caring about employees are not exclusive.

~~~
cyborgx7
My point is that the entire reason why people say we need the profit motive to
motivate people, is because caring for other people is not enough to motivate
their behavior.

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Hard_Space
As a remote worker, I think there is an assumption of 'necessary common
suffering' which continues to make remote work a 'privilege' rather than a
simple logistical alternative. So long as there are on-location cubicle-
dwellers who might get disgruntled to know that other employees are living
some kind of fantasy high life from home (working in PJs, etc., all the
tropes), then providing any remote working options becomes a potentially
destabilizing force for a company.

Making a remote worker's income less attractive is one way to redress that
balance of perception.

I'm not sure how much progress we are ever going to make towards remote
working as core practice, since the last decade has re-built a collapsed
economy on the basis of hyper-inflated urban property values in 19thC-style
urban conurbations such as NYC, SF, Tokyo, London, etc (and, increasingly,
smaller satellite cities that had not benefited in this way until recent
years, but have now become super-distant commuter communities).

The net-enabled, 'dispersed' society is probably further away than it has ever
been because of these factors.

~~~
stakhanov
First: It's just horrible to build a company culture around assuming
pettiness. I'm not saying that it isn't true that human beings are often
petty. But you shouldn't optimize around being a great place for petty people
to work at.

Second: Being forced into an onsite job in a city with high rents and bad
traffic is bad. Being taken advantage of on salary for living in a low cost-
of-living area is also bad. One badness doesn't cancel out the other. There
are just so many instances I can think of of going to a manager and making
some argument that's a variation on the theme "Can you please stop treating me
badly?" and the response being "We treat all these other people badly, so if
we stop treating you badly, that would be unfair to them!" Well, that's just
not a valid argument! I don't want to be treated badly, and if not treating me
badly implies not being able to treat these other people badly, then maybe
that's the route you should be taking, goddammit!

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stakhanov
I think that one of the greatest structural deficiencies of our economy is
that high salaries are tied to onsite jobs in a few cities and that,
therefore, real estate owners in those cities get to participate in that
wealth creation that they are not actually a part of. So they reap where they
didn't sow, and that's just unfair.

By working remotely, companies and workers are working together in cutting
those landlords out of the equation, and that leaves a huge pile of money on
the table that landlords are now not taking away from companies or workers
(depending on how you look at it).

The question is: Should it be the worker or the company getting that pile of
money?

My feeling is: It should be shared as companies and workers have to work
together to make it happen.

If the whole pile of money goes to the workers, then companies are not
incentivized to do anything to drive forward the remote work revolution.

If the whole pile of money goes to the companies, then workers will have an
incentive to continue to play the old game whereby, if they want to earn more,
they have to move to the valley and take an onsite job.

If the pile of money is shared somehow, then both sides have the right
incentives to drive forward a real change for the better, and it's a win-win
situation for everybody involved (except the landlords).

I'm not saying the split has to be 50/50\. Realistically, the split will be
determined by market forces like supply and demand around the particular job
role. We're already seeing this play out: For job roles that have low barriers
of entry and for highly commoditized types of work, a greater proportion will
go to the company, like what we are seeing on Upwork where everybody gets paid
what an Indonesian freelancer gets paid. For jobs where it really matters to
get the best people and where these people are hard to get, a greater
proportion will go to the worker and you will see everybody around the world
doing that kind of work earning as much as they would earn if they were doing
that job onsite in the valley.

------
armonge
Used to work in Nicaragua for a US company with a local office. We were
definitely being paid a lot less than our peers working directly in the US
locations, at the same time we were being paid what was at the moment a lot
more than the standard for other devs in the country.

There would have been no incentive for that company to open an office in
Nicaragua if they would have had to pay similar salaries than what they were
paying in USA, i mean, we have a lot more employee benefits and protections.
Of course i would have loved to get more money out of it, and i feel we were
delivering equal value than our peers, but if i think about it, the economics
wouldn't have made sense.

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buboard
If anything remote workers should be paid _more_ for being environmentally
friendly

~~~
reportgunner
Where will the extra money come from ?

~~~
goatinaboat
There are costs associated with working in an office - consider rent,
cleaning, furniture, power, a receptionist, maybe an entire facilities
management department, security and so on. These costs are split amongst the
revenue earned per worker in that office. But homeworkers provide all those
things for the company “for free”. And even more the homeworker might even
provide the PC, the phone line, any tech support they need, all “for free”
from the perspective of the company beancounters. In a fair world homeworkers
would be paid this differential.

~~~
reportgunner
Yes that is true. Except for the cases when workers already _start_ the job as
remote. In such cases these costs are never created and therefore never
avoided.

You should also consider that the costs you've outlined are not paid "per
headcount" but rather collectively for the company / per company site. This
means that often the company would need to completely disimss the office
location or move to a smaller location.

I do not disagree with you, I'm just showing that money are not some magical
points that you allocate with everything else falling into place.

------
notacoward
I've been a fully remote worker for almost a decade. I appreciate the fact
that my compensation is on a scale implicitly tied to a higher cost of living
than where I am. Nonetheless...

Companies don't set pay to be fair. They set pay to attract and retain the
talent they need. Otherwise, companies that employ people in India wouldn't
have a 3x pay spread for people doing the same work (hi Red Hat). Software
developers in general wouldn't make more than, say, plumbers. The potential
employees' perception of fairness does come into the picture a bit, but that
takes a _distant_ back seat to good old supply and demand. If a company needs
to pay more to attract and retain talent in area X, they pay more. If they
need to pay less to attract and retain talent in area Y, they pay less. This
is just basic business. Companies pay local prices for real estate or
electricity, and they pay local prices for personnel.

The only thing different about remote workers is that there's no single local
standard to measure against. So you have to tailor things more specifically to
the individual. But if you think that you should pay remote workers more or
less because they're more or less productive, or because you're saving money
by not having to provide them an office, you're forgetting the purpose of pay.
Attract and retain. Supply and demand. That's _it_.

P.S. I'm not trying to make a moral argument here. I'm certainly no laissez-
fair "markets uber alles" greed funnel. Quite the contrary. Companies are free
to make their decisions on some different basis and more power to them, but
there's no escaping the fact that most will cut costs wherever they can. Of
the places they might cut corners, geographic salary differences are far from
the worst option. If and when salary fairness gets to the top of the list, I'd
start with not paying _women_ less.

------
hajimemash
One way that in-office workers can be more valuable is more accessible and a
higher quality of communication.

Being able to discuss things face-to-face gives us more and higher quality
(diagramming, eye contact) communication channels, in addition to avoiding
things like bad audio, bad video, etc.

There is also lower friction in haphazard discussions; someone can overhear
things and chime in a thought that could turn out to be useful. Sometimes, the
effort of messaging or calling someone will cause us to not bother to include
someone in the conversation for a chance that they could contribute.

If different timezones are involved, then a remote worker's value is lowered
due to the higher friction in addition to the round trip time for
communication.

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protomolecule
As a remote contractor, I'm strongly against this idea.

Living in a country with the cost of living lower than in the US allows me to
take a job of an equally qualified American programmer by working for a
smaller salary which is still twice as big as the highest offer from a local
company.

The downside is that an equally qualified programmer from Egypt or Bangladesh
can easily take that job from me, but I can find solace in the fact that this
reduces the global poverty :)

------
angarg12
You might not _need_ to compete with Google, but I see an opportunity there.

Pay average Bay Area salaries to full remote workers in low CoL areas. Most
likely top tech companies have no offices there, and even if they do, chances
are you pay more.

------
romanovcode
> Why on earth would it matter where your desk is?

It matters to product managers. Managing remote team is more difficult
therefore PMs will always push against this.

~~~
oAlbe
Why is it more difficult? Do you have some data or anecdotes to back up your
claim? I'm really interested.

I've been working remotely for years now, and my relationships with the
various PMs I've had has always been: talk about what needs to be done, and
then be left alone to actually do it, check back when I have progress or if I
have outstanding questions that arose from better understanding the problem
domain. Plus the daily stand up meetings that have always been optional to
attend. Done, nothing else, nothing complicated.

Is this uncommon across the industry?

~~~
ta980345
I've been working for a company where people optionally do remote work from
home; the difference in communication and team cohesiveness is stark to me.

When people are colocated in an office (and I guess this is a generalization),
there are more incidental chats, knowledge-sharing, status-updates,
stress/challenge-sharing etc.

I do better work and get more done at home though, and from an environmental
perspective it seems like an obvious choice.

~~~
oAlbe
There's a lot that can be written about the differences between remove vs on
site work. Sure, remote does tend to feel more lonely. Sure, you are missing
the whole water cooler effect (as I've seen it called) of running into a
coworker at the office and just having a chat, and so forth. But I don't
really see how that makes the job of a product manager any harder or how it
makes managing remote workers harder.

Companies with offices still use work methodologies. They still use SCRUM,
kanban boards, retrospectives, meetings, wikis/documentation, and above all
tickets/issues/stories or whatever is the term your company prefers. And I'm
sure they aren't writing their stories on pieces of paper, or their
documentation in binders. Everything is done through a tool that saves
everything online to make it available to everyone.

Your PM running into you at the office while you are taking a break and asking
how the work is proceeding doesn't really add any value to neither the work
you are doing nor the information they already have about it. Scheduling a
weekly catch up meeting to discuss progress (depending on the size of the
story of course and yadda yadda, just making an example here) makes more
sense. And you can easily do that with a video call.

