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Ask HN: Location based pay is killing my motivation, how do others handle it?
255 points by pyrodactyl on Sept 4, 2022 | hide | past | favorite | 371 comments
Recently I got to know the pay scales that my peers and even junior developers are getting in the US/EU. It is substantially more even though we do the same work. Though I've known about this policy, getting to know the numbers is extremely jarring. It's causing a lot of resentment and detachment to work from my side.

I've raised this issue with my manager and they've told me that I can transfer if i want those pay scales but that's not a possibility for me. If the company is willing to pay me that amount in a different location, why can't it pay me the same here?

The reasons they've given me are weak and I want to debunk them.

1) cost of living - a lot of my colleagues are in locations where they can buy independent houses which are cheaper than an appartment in the city I live. Real estate in my country runs on black money, and I'll probably never be able to own a house. Some of the EU countries provide free health care and education, I'm just a major health issue away from poverty. Most of them come from nuclear family cultures, where as I take care of my retired parents and younger siblings, and if i get married that's a whole new family.

2) talent - if they are more talented than me then why am I in a more senior role than them. And my talent won't change if I change location so why should my salary

3) something about not trapping in a high salary job - I dont even know what to say about this. I would love to be in that trap instead of the one I'm in right now where I'm being forced to migrate, where I would loose my family, friends and all the support structures I've built around me, to receive the same benefits as my peers.

This seems senseless to me. What would the company gain if I work from a different location that they would pay me more? It feels like a poverty tax and I've never felt more like a cog in a machine.

What do others think about this and how do you deal with this?




Your pay is based on the cost to hire your replacement. That’s it. There’s no crazy conspiracies, there’s no moral failing, they’re not running a calculator of how much value you generate. Would it sap your motivation to learn there are people doing your same job at FAANGs making double what you make? Or that some other job makes more money than you? Location based pay is just another variable. As with everything in jobs - if you don’t like the comp structure, it’s very rare you’ll argue them into changing it. If there are other companies who have comp structures you like more, go get a job there. If you can’t find any, you’ve probably learned something about the job market.


> Your pay is based on the cost to hire replacement

What is being described here is supply/demand economics. If you think you’re being underpaid, quit, find something else that pays you more. The reason why you won’t quit is the reason why the company doesn’t pay you more. You don’t have other options, and if you quit, they know there will be 10 other people ready to take you place for those wages.

Part of the reason why wages in places like the Bay Area are high is because companies are competing with each other for talent and if you don’t pay people, they are ready to quit and replacements aren’t easy at lower wages.


> You don’t have other options, and if you quit, they know there will be 10 other people ready to take you place for those wages.

I'm just imagining this dude quitting and his manager suddenly realizing that no one else knows anything about the parts he worked on and how fucked they are now. Just because a bunch of people could take your job doesn't mean they'll give a shit about the job. Good, well motivated, employees are extremely hard to find. Understand your value and don't let some dude in a button down shirt who has never written a line of code trick you into thinking you aren't valuable.


> I'm just imagining this dude quitting and his manager suddenly realizing that no one else knows anything about the parts he worked on and how fucked they are now.

I would bet its rarely a case. We like to think that we are irreplacable, but after our quit company/project is still moving on.


> I would bet its rarely a case.

I agree that life goes on, but it's not rare at all. It happens all the time. People leave and things are f-d up for a while.

The thing is, it's not a permanent condition. People adapt, new hires are eventually found to fill the gap, or others who were thought of as not up to the task take the opportunity left by someone's absence to step up in their career.

One person leaving won't sink a company that is large enough. That doesn't mean it won't hurt, however. And how the company handles things after the departure is very critical.

Perhaps more important (and dangerous) is the morale hit that the others will feel as their peers start leaving. There very much can be a "rats-leaving-the-sinking-ship" effect that can be precipitated by a key person leaving.


>There very much can be a "rats-leaving-the-sinking-ship" effect that can be precipitated by a key person leaving.

Oh, yes. One person does not sink a ship, but I've seen cases where whole teams leaving destroyed companies.


100%. I recently quit a job (FAANG) after 13 years and I thought I have so much institutional knowledge that mu departure would be impactful for at least a little while.

And while I was under no illusion of my importance and did not expect any breakdown of the team or anything like that, I did think I would get at least ONE question after I left from my previous teammates about some obscure thing that I thought only I knew.

Nada. No one asked me anything - they had no issues for which they had to reach out to me. Team did a re-org and things just kept moving. It was a humbling realization to say the least.


Your knowledge is now arcane black magic. The reorg probably shuffled away the people who knew that you knew what you knew, you should be proud.


Having left and (briefly) returned to the same team, absolutely this, 100%. People typically avoid touching functionality they don't understand, for (legitimate) fear of breaking it in unknown ways. New features and changes are built up on top of the existing edifice, rather than trying to change the edifice itself. You end up with an unstable tower of layers in which it's more and more difficult to get anything done -- but not impossible, and not suddenly more difficult all at once. It's a slow boil.


No one asked me anything - they had no issues for which they had to reach out to me.

More likely no one cared.


A lot of times they move on with larger technical debt, less understanding of their own systems, and less resiliency when things start to break. These issues accumulate over time especially if smooth transitions between technical knowledge isn't kept (like when employees are constantly jumping ship), and lead to places eventually hiring consultants for $1600 an hour to fix their technical mess.

It also depends how regimented the team is, places like Amazon have large numbers of coders on the same project, watching over each other. But they also compensate their employees well.


You are right but this just increases the cost of hiring a replacement and you can only ask for a raise if you show them a counter offer.


I did a stint in management, before I figured out it wasn't for me. In my country that involves getting into university level management courses, networking with other managers and getting a mentor. At least if you're working in an organisation that values its employees. Throughout it all the truest thing I ever learned was from my mentor who was one of the best managers I have ever worked with, and this is a direct quote. "Nobody is irreplaceable, sometimes it's expensive to say goodbye to someone, but nobody is irreplaceable.".

Over the decades this has proven itself to be true so many times. I've been part of big enterprise organisations as well as smaller startups that had some "vital" proces which relied on that one person. When they left however, it didn't really change anything in the big picture, sometimes it let to the entire guts of a company getting ripped out and replaced by something different, but in the big picture it just became another thing to solve.

I think it's a good thing to learn, both as a manager but also as an employee. Because at the big picture, what "irreplaceable" really means is "liability", and that's not a great thing to be at a company.

Good managers will work with you on how to reduce your importance, and great employees will know how to do so themselves. In the world of work, a good work relationship is one where the organisation you work for give you opportunity to grow, and sometimes that means, outgrow the organisation itself. But it goes both ways, and you should try to respect that, even if you're the rockstar employee because it'll make you even more valuable.


most businesses don't care and don't understand the technicalities of deep nerdy work.

they are fine with throwing their money around until a problem is solved. and would much rather hire someone with 1.5x your pay than to give a 10% raise. its just a political / power thing...

internal politics and preserving imbalances in distribution of power is much more valuable than adding a little inefficiency to worker output


Sometimes your manager is happy for you that you quit knowing you could make more outside of the comp structure at the company you work at.


What you’re describing is a temporary setback and loss of productivity for the company. Almost never is it make or break situation for the company. You can hire someone who doesn’t care and is not motivated as the person who left, but the net effect to the company is marginal.

In the rare occasion that a single person is valuable enough that if they leave, the company would shut down, the person is well compensated.


You would love https://reddit.com/r/MaliciousCompliance and https://reddit.com/r/pettyrevenge. Sort by Top > All-time ... Some of the best stories are exactly that format


Ultimately, we muddle through. Nobody is irreplaceable.


Well, I don’t think an employee who fantasises about sinking the ship by leaving is still a “good, well motivated” employee


Being aware of your value != wanting to ruin your company. I feel like many programmers are actually very happy with their positions and don't seek to change them.


This doesn't necessarily work the same way if pyrodactyl and the people he works with all work remotely. If they did, then surely they'd fire 10 people based in the Bay Area and hire the "10 other people ready to take [the] place for those wages"?


Or organise.


That's not for highly paid tech jobs. Unions ultimately drive pay lower for the whole in high-paid sectors.


Citation requested.


> Your pay is based on the cost to hire your replacement. That’s it.

Only in an imaginary world of perfect information and labor liquidity, which is about as far from what we have (and could have) as can be.

Location-adjusted pay for remote US workers is indeed a social norm, proposed by some firms and accepted by enough of labor for it to work for them. It persists mostly because it exists and because there’s no organized effort to disrupt it.

Nonetheless, their are still many firms that don’t do that, many employees that don’t settle for it, and some firms that initially negotiate from it while accepting counteroffers that reject it.

Reducing an extremely complicated market to an oversimplified post hoc theory, just because it exists a certain way, is neither correct nor helpful to the issue at hand. It does nothing but shut down richer discussion and reinforce an incidental status quo.


I'm emotionally with you, however the OP is right in that the GP most likely doesn't have any options other than quitting and going to a company that doesn't do this

OP is also correct in that the following is how HR at almost every large company thinks about comp:

1. Comp is usually not set by a Hiring Manager and is specifically based on "comparable" which is based on job type and location.

2. Job type and location is by far the easiest way to create a heuristic for pay rates because the data is public

It's basically impossible to individually value everyone's contribution consistently and without bias across hundreds or thousands of employees - plus I don't think people would want to actually be judged with any method that puts granular measurement on something as vague as "value"

So if you can come up with a better way to determine pay *at scale* other than the open market approach, I'm super interested.

The only way to do this in my mind is to never pass -- lets say -- 100 employees.


Just a small nit but I think you mixed up OP (Original Poster) and GP (Grand Parent).


Hah! I was just wondering if maybe my understanding of those terms was incorrect... Thanks for confirming that I am not going crazy (in that way, at least)!


All in all, I agree with what you are saying.

I would just like to add that I have found myself extremely happy working for a company of ~100 people (especially when compared with my previous company of ~30,000).


I'm not sure why you think this is not helpful. Yes there is a bit more to it than "how much does it cost to replace you" but it is correct and is helpful. You can still have a discussion, but about what?


> Location-adjusted pay for remote US workers is indeed a social norm

That's backwards, though. It's a social norm because it's the most workable solution. Firms that overpay salaries (defining overpay as paying far above the market rate in any given region) will not be able to afford as many employees / highest quality employees / as much marketing / as much downturn stability or runway / as much other investment as their competitors, so they will lose on average.

And this makes sense. The same forces that drive salaries up (competition from other employers willing to employ the same person) also drive it down. You can't only have upside.


> Firms that overpay salaries (defining overpay as paying far above the market rate in any given region)

Why the market rate in any given region? Why not just the market rate?


There is no single one. Do you mean the market rate in the most expensive places to live in the world?


See that's kind of my question: Why and how is there no single market rate? If you have truly worldwide remote work, that's what you would expect, right?


I don't know why that would be. Markets aren't intrinsic to how things work; they emerge if people are allowed to trade (including their time as an employee) according to a set of predefined rules.

So salaries might go up in one region if people want to do business there, for the sole reason that there is competition amongst employers for the employees there. They'll go down (or stay the same) if there's competition amongst employers for employers.

How does your example raise salaries all over the world to the most expensive salaries, worded in a way that also explains how those expensive salaries came about?


Not exactly. Because not all locations have the same value. Ie; harder to travel to, less infrastructure, more latency, working hours not lined up with certain market hours, etc. Two prior doing the same thing in entirely different places, aren’t always equal.


In the US, sure. There are a very small number of employers paying employees in say Eastern Europe, Africa or South Asia the same as an American equivalent.

Hell, I worked for a Canadian company that paid Canadian employees 30% less.


If that were true companies would never hire in the Bay Area, or even the United States. There’s always a cheaper alternative.

The question is, once the company has decided it wants you, what’s that going to take? Making national median offers to Bay Area candidates essentially swears off of ever hiring them. That could be a choice, but for now it remains a bench of talent and experience that companies want to draw from, even if not exclusively.

Making Bay Area offers to rural candidates is giving them 4-5x their next best option, which is characteristic of either a) the devil, or b) rich people making expressive displays rather than business transactions.

It’s like everything else, your leverage is your next best alternative, and until work goes fully remote location is a factor in that.

EDIT: I will add that if you think calibrating an offer based on the worker’s alternatives is crass, think for a second about what exactly your skills, education, and experience are for. Those work through the same mechanism. If that mechanism is wrong, you should be happy to work for the national median wage across all industries and all education levels. Even a mediocre SWE salary is way too high.


Bay Area companies hire in the Bay Area, for the same reason companies are founded in the Bay Area to begin with: because most of the VCs in the US live in the Bay Area. And Bay Area investors care a lot about having a package of colocated staff "human assets" that put an acquihire-based floor on the company's acquisition price.

Companies that don't operate from the Bay Area, almost never hire Bay Area remote workers; and companies that are headquartered outside of the US, almost never hire US remote workers. Precisely because they cost too much, for a company that gets no advantage from doing so. (Source: we are a Canadian company; we hire from everywhere but the US.)


> Source: we are a Canadian company, and hire from everywhere but the US.

I don't follow. This isn't true at all in my experience, plenty of companies in Canada and the US hire across Canada and the US. It's practically the norm.

If you work for a Canadian company that doesn't hire in the US then you're comically underpaid. Wages are converging very fast. Many companies are paying parity and frankly folks are selling themselves short if they don't fight for parity.

(If you're not talking about software development, then ignore me)


(Context clarification: I'm not an employee of a Canadian tech company; I'm a cofounder + major shareholder of one. I'm looking at this from the hiring side, not the being-hired side.)

Wages might be "converging" to the same numeric value — CAD$N in Canada vs USD$N in the US — but those are, and have always been, very different amounts of money. The two countries are still nowhere near the sort of economic equilibrium-state where Canadian companies are paying the prevailing US salary exchanged into Canadian dollars.

Also, there are a number of costs related to hiring US remote workers (as a company headquartered outside the US) that don't apply to hiring remote workers in most other countries. You're expected to provide some kind of private insurance plan, for example. Take-home pay may be converging, but the cost to the company of hiring a salaried US employee — or even a US contractor, as long as you care about being equitable / not building resentment when your employees talk amongst themselves about relative total compensation — is still higher than the cost to the company of hiring elsewhere.

And to be clear, the prevailing wage isn't even that relevant, as we're not really talking about "hiring the median American" vs "hiring the median [person living somewhere else]." We're talking about hiring people who apply for — and are considered top candidates for — remote tech jobs, among a global candidate pool. In the US, these people mostly happen to live in HCOL areas (like the Bay Area); which means their BATNA is to be paid far more than the US median wage for an SWE, because that's what the companies in HCOL areas have to offer to retain local talent there. To hire these people, you can't just offer "the going rate"; you have to offer FAANG money.


> The two countries are still nowhere near the sort of economic equilibrium-state where Canadian companies are paying the prevailing US salary exchanged into Canadian dollars.

You may be surprised to learn that this is quickly changing.

> Take-home pay may be converging, but the cost to the company of hiring a salaried US employee — or even a US contractor, as long as you care about being equitable / not building resentment when your employees talk amongst themselves about relative total compensation — is still higher than the cost to the company of hiring elsewhere.

This is not true in my experience. It's slightly cheaper to hire in the US than other markets, if you do not yet have any presence in those markets. It's a wash long term. Some firms offset the extra costs for US workers benefits by simply paying others more.

> To hire these people, you can't just offer "the going rate"; you have to offer FAANG money.

In the ballpark, but yes. The gap is rapidly closing. Plenty of seed or series As are paying near FAANG rates.


I've worked at a handful of FAANG companies in the Bay Area and Canada, and I have numerous close friends working at early to mid stage startups in San Francisco. Anecdotally, those at startups earn ~20-30% less cash and dramatically less total compensation if you consider the expected value of their equity packages. By my rough math, you really need to be employee <= 10 and exit at over $1B for the TC to surpass what a typical senior engineer can earn with far less risk at BigCo.


> This isn't true at all in my experience, plenty of companies in Canada and the US hire across Canada and the US. It's practically the norm.

Probably only after they get to a certain scale and cannot find more talent in Canada? When did Shopify start hiring in the US - right from the beginning?


No? If I started a company in Canada tomorrow, why would I reduce my talent pool and not look at the US? Most startups are eschewing offices in an obvious move for cash-strapped businesses. If you're hiring remote then borders should be a mild nuisance at worst, and at best a force multiplier.

Example: Show me a startup in the YC job board based in Canada (there are many these days) that is hiring locally only for software engineers.


Shopify did hire talent from Europe years ago. I would see them on every bigger networking event with glossy flyers about how they will pay for everything if you want to move and work there.


Europe is not equivalent to the US. Granted, it's outside Canada, but it's probably even cheaper than Canada.


Shopify should not be considered a tech company. Ecommerce in general isn't a technology problem. Just to give you an example of how comically small fintech is here is a global example: Visa processes around 1,700 transactions per second.


Shopify does not pay well


> Bay Area companies hire in the Bay Area, for the same reason companies are founded in the Bay Area to begin with: because most of the VCs in the US live in the Bay Area.

You're putting the cart before the horse. Investors live all over the place, and large funds have offices in markets where there is a signifcant number of possible high growth companies to invest in. And they'll invest where they don't have an office and always have.

The reason why so many investors are in silicon valley and san francisco is because of the companies. And the companies are here because of the environment. I've worked around the world but the reason I love working in the valley (specifically the peninsula) and not elsewhere, not even SF, is because of the extreme density of people, resources, markets, and just the sheer intensity of the place. I hire from all over the world, but really, just getting shit done is so much easier around here.

Ignore the bros. Those assholes get the press 'coz they're interesting to write about. I'm talking about nerds in true tech businesses like hardware, software, mechanical systems, pharma.

It's not for everyone, and even people who would like it may choose elsewhere for other reasons. Those decisions are all legit too.


Two-sided markets have virtuous-cycle network effects, yes.

DARPA made Silicon Valley, but Stanford and UC Berkeley — and nearby communities that evolved to become basically playgrounds for the students of them — kept it going. Entrepreneurs came (or stayed) to capture the supply of smart and bored college-aged intellectual labor; and VCs came (or stayed) because of all the entrepreneurs.

But that doesn't mean that seed-stage companies don't move to (or stay in) the Bay Area these days primarily because of the VCs, rather than because of the talent. Talent is free to move anywhere it likes — especially these days. An entrepreneur will find just as many potential employees for their startup in literally any college city.

But tech VCs (and especially ex-tech-entrepreneur angel investors) will, despite having a presence in many places, mostly still live and spend their free time in the Bay Area. And so you'll be much more likely to have your name on their lips if you're showing up at local events they attend, bumping into them at restaurants, meeting them on the golf course, etc.

Let me put it this way: every Canadian seed-stage startup I know of, has their CEO regularly fly to the Bay — even if they're located on the east coast of Canada! — to rub shoulders with the Sand Hill VCs, in hopes that they'll get more attention there.


> Making Bay Area offers to rural candidates is giving them 4-5x their next best option, which is characteristic of either a) the devil, or b) rich people making expressive displays rather than business transactions.

No? If you budget to hire two employees at Bay Area salaries and don't care where they work, you should pay them Bay Area salaries regardless of where they work.

Plenty of companies do this. It's fine. I don't see anything devilish or expressive about paying all your staff the same wages.

> I will add that if you think calibrating an offer based on the worker’s alternatives is crass

I think you're foolish if you don't expect a worker's alternative might be in the Bay Area salary range in the year 2022.

> Even a mediocre SWE salary is way too high.

It's not. The dollar-value delivered by a mediocre SWE has been significantly high for a long time, often orders of magnitude the salary.


If employers stop getting the candidates they want with location-based offers, they will go away. Right now people may grumble, but they sign. Like OP did.

Making a Bay Area offer when you could just as well have closed the candidate with a locally competitive offer doesn't make business sense. It is exactly an expression of the company's values: that it thinks paying people the same is inherently, morally good. Which is not an uncommon set of values in tech! If you can find a company like that, more power to you. But whether it's sustainable to be paying more than necessary for some of the staff depends on the company's economic conditions. If the company ever needs to trim its sails, then reverting to location-based pay would be a natural step.


> If employers stop getting the candidates they want with location-based offers, they will go away. Right now people may grumble, but they sign. Like OP did.

Yes, which is why I recommend not accepting location-based pay. It works!

> Making a Bay Area offer when you could just as well have closed the candidate with a locally competitive offer doesn't make business sense.

Sure it does. If your revenue isn't locale dependent then it makes perfect business sense. Obviously if you're selling local McRuralTown widgets for McRuralTown denizens and the cost of living in McRuralTown is peanuts then this won't work for you, but you're probably going to have a hard time hiring smart software people.

> If the company ever needs to trim its sails, then reverting to location-based pay would be a natural step.

Typically this is a non-reversible policy. Reverting to locale-based pay is a suicide pill unless you're churning your entire workforce, in which case the pill is likely already between your teeth.


>If your revenue isn't locale dependent then it makes perfect business sense.

The delta between the wage needed to get & keep the candidate vs. the wage you're actually paying them is essentially a charitable donation here. Of course businesses regularly do philanthropy, nothing wrong with that. Their own upper-middle-class employees are a weird choice of beneficiary though.

Business sense would be to keep the money and put it towards its most productive use, like hiring another employee or procuring labor-saving technology.


> The delta between the wage needed to get & keep the candidate vs. the wage you're actually paying them is essentially a charitable donation here

If you are doing location-based pay, the difference between the wage you are paying in inflated regions and the wage for a similar candidate in the least expensive region from which a candidate is available is a charitable donation.

Location-based pay means systematically overpaying for labor unless you are taking your own location-based pay schedule into account when hiring and preferentially selecting candidates from low xost regions unless the quality of the candidates from the high cost region makes up for it. But that's just a roundabout way to get to the equivalent of location-neutral value-based pay.


>for a similar candidate in the least expensive region

Right, if you can find them. But the distribution of talent isn't random: bright ambitious people were responding to incentives to migrate to tech hubs at least up until the pandemic. People grew from intern to senior working in the industry's most respected engineering shops there, learning from the best. And that includes global talent: H1Bs are everywhere. There's a case to be made that this cohort is overrated or overpriced and you don't need them - fine. But if you want to hire them in numbers, you're going to have to pay wages that are competitive where they live.

I agree you wouldn't want to hire very junior or unimpressive candidates from the Bay Area/New York/Seattle for remote work, when you can get similar candidates for much cheaper in LCOL regions or countries. But if you're looking to hire from the top end, and your offers aren't competitive there, you're going to miss a lot of great options.


> But the distribution of talent isn't random: bright ambitious people were responding to incentives to migrate to tech hubs at least up until the pandemic.

Right, so pay-by-value will probably end up paying higher wages, on average, in tech hubs, without any resort to pay-by-location.


But if you can hire two people from anywhere, why budget may area salaries?


Because then you won't be hiring people from the Bay Area -- or me.


> Your pay is based on the cost to hire your replacement.

That's not necessarily true. Many fully remote companies hire from anywhere and pay location-adjusted wages. So it's a roll of the dice whether the replacement makes more or less than you.


What exactly is the rationale there? Why wouldn't companies just hire the people willing to work for a lower salary?


because it's not the only factor in hiring? competency and likelihood to succeed in the role does still play a role


Sure, but why is a company willing to suddenly pay more for someone depending on where they live? I get that competency and likelihood to succeed play a role, but if you have those I don't see why location should play a role at all.

I'm not saying they should give more/better offers to people in 'cheap' locations, I'm saying location shouldn't influence the offer at all.


Many companies can't hire people in 'any' location due to how their legal entities are setup in different countries, how many of them they may or may not have and possible complications with tax etc.

Once you get past that basic hurdle, you might find that the company is willing to pay more because they want a given skilled worker to be co-located with the team they will be joining to increase productivity which might come at a higher price than hiring into a different location but potentially trading off worker and/or team efficiency.


> you might find that the company is willing to pay more because they want a given skilled worker to be co-located with the team

That's making a big assumption — that the team is in an HCOL area, such that "colocated with the team" is synoymous to "costs more."

There are a lot of companies who are headquartered in LCOL areas of the world; but still do location-adjusted pay, such that they might be paying someone working remotely from an HCOL area more than they pay the local team.


Competence is a continuous spectrum. People in its upper reaches are disproportionately likely to have already moved to talent hubs where their earning potential is highest, or to have acquired their competence working at companies there (and put down roots). Because they are still in talent hubs & have access to those markets, you cannot get them for less than talent-hub pay.

So you either: a) write off every candidate who is still in talent hubs, b) pay way above everyone else's competing offers so that your universal salary is also competitive in talent hubs, or c) pay based on location.


Hence it being the cost to hire/pay your replacement not just cost to hire anyone.


But this is a discussion about location-based pay, not competency-and-likelihood-to-succeed-in-the-role-based pay.

I don't think the OP would feel demotivated after learning their company pays competent employees more.


Companies want to hire the best in a given market not necessarily the best in the world.


I don't see how that contradicts GP's point ("Your pay is based on the cost to hire your replacement.")


No way. No company in the world is just hiring anywhere and paying whatever the living wage happens to be at that location.


> Your pay is based on the cost to hire your replacement. That’s it.

That's not quite true.

The cost of hiring your replacement is only the maximum they'll accept to pay you. But they will pay you only slightly above what they think you'll find elsewhere. So your pay is the MIN(cost of your replacement, what they think you can get elsewhere).

That explains location-based pay for remote jobs. Because they take into account that your alternatives are mostly local, so they only have to compete with local rates. The only way out of this is to be willing to relocate, or convince them you're getting enough good remote offers that they have to compete with that.


I think it's 3 - the role has to be valuable enough to pay for:

MIN(cost of your replacement, what they think you can get elsewhere, your value to the company)


In this case, 3 is proven as long as the company is actively hiring in the higher paid location


Hmm yes. I think this is also evidence that the company values the person being in that location more than the other one, which might translate to higher (3).


they can't calculate 3 so it doesn't come into the conversation


If they can't calculate 3 then how is there budget to hire you?


i don't know if you have worked in these organizations but they don't know.


I don't know to which organisations you're referring.


Companies? They might know the averages, but no company ever knows how valuable which employee is.


I have worked in companies.


As a remote worker I have to disagree. My value is the local value for the employer. I could decide (and recently did) to move countries and it might change taxation and labor laws but for the most part they don't care about where I am situated. What they care about is the speedy resolution of feature requests and trouble tickets.


Its not a crazy conspiracy, I know it's pretty clear why it's being done. And I know I can't do anything about it other than look for new opportunities.

But should location based pay be just accepted because that's the norm? There are variables that can't be used to do discriminate like age, gender, race, sexual orientation etc. We've accepted equal pay for equal work in these cases. Is it that far fetched that even location should be treated the same?


You’re missing the point. Location based pay is not the norm, the norm is paying you as much as it would cost to find an equivalent replacement. That just happens to be location-dependant.

It’s got nothing to do with discrimination, it’s purely about hiring for the lowest cost. They have to pay more in EU and US to get employees, and less wherever you live.


So if they quit, are you saying the company to refuse to hire a replacement from the US/EU due to some purely budget related limit? That is definitely not my experience working with a few remote first companies. They will try to find a suitable replacement in the relatively short period that is recruitment (1-3 months, depending on seniority). The cost difference for one employee is usually not big enough to worry about in the larger scheme of things.

The opportunity cost of not having that senior dev on board for more than 3 months is damaging for rest of the team and company goals/time lines. In the current market, my guess is that this person would be replaced with someone NOT in that location unless for some reason it is business critical to have someone in that area, which is almost never for software developers.


> The opportunity cost of not having that senior dev on board for more than 3 months is damaging for rest of the team and company goals/time lines.

I work with HR team who sets compensations for our global workforce. If you think that HR and leadership does not take this opportunity cost in consideration when setting policies, you are badly mistaken. They are very rational in their decision making.


But then, why would the company agree to an increase in compensation if OP moved elsewhere?

This is the point that doesn't make any sense. If it costs them X in OP's locale and 2X in EU, the company should kick them out if they decided to move and replace them with someone in the original locale, or maybe someplace even cheaper.


Most people who haven’t already moved countries won’t when offered that rebuttal. (Some can’t. Many more won’t, for some good and practical reasons.)

Because of that, the rare employee who does move can be paid the new location wage without increasing the costs of the people who don’t move. Companies don’t care about the costs of the <5% of people who move. They care about the costs of the >95% who don’t.

(Side note: There are companies who budget in headcount and work like GP suggests. I think most companies budget in money and work like you suggest.)


"It’s got nothing to do with discrimination, it’s purely about hiring for the lowest cost." - that's how pay gaps based on discrimination (e.g. based on sex or race) have been sustained as well.


Would you accept if your landlord got upset when he saw how much some people are being charged for rent in silicon valley, and decided to triple your rent?


If it makes your neighborhood and/or city very similar to these in SV, why not?


So, like full of homeless people and litter? No, thank you.


Why would it? Paying someone in (say) Warsaw a SV salary isn't going to make Warsaw like SV either.


If looking at it from a company perspective, I'm not sure I would see much benefit for them in doing so. If a company is based in the US/EU and pays the same wage to workers in someplace like Asia, they would not gain much(financially) by hiring in Asia in the first place (companies that have no need to hire in Asia). Why bother dealing with the grumbling at home about exporting jobs to outside locations if they are just going to pay the same anyway. Might as well be the hero providing jobs to local workers at home and keep the money circulating there. As for the other, age, gender, race etc. All of that is also at home, so not discriminating against it is beneficial. What is not at home are foreign located workers.


Talent is scarse. People are hiring outside of the US because there is no one else to hire from at current payrange in those locations. You could start a biding war and pouch from other companies but that may not be financially viable for your business.


> But should location based pay be just accepted because that's the norm?

If we don't accept location based pay and start paying a uniform global salary, the wages will sync to Asian job market level rather than rising to SV level. Any company doing so will not be able to hire anyone in SV.

OTOH any company paying SV level wages to everyone will do so only for a short while before they realize that they can increase the profit by reducing pay elsewhere. Why would they not do that?


Imagine paying someone in my town where the median income is $39k and the median property value is $87k the same as someone in San Fran where the median income is $120k and the median property value is $1.15M. that would be unfair to everyone in my town who can't work remotely with a tech company that's in that area.


To anyone who thinks that I agree with what I said you are misunderstanding the way I said it. I'm just stating how things are. Cost of living is what dictates pay along with the value that you provide to a company but with remote work that gets adjusted to what the local cost of living is.

Plus I don't work. I'm disabled I collect SSI I get like $10,000 a year. That's it! I can't have more than $2k in my bank account. I can't invest. So uh, have fun making tons of money I could only imagine.


I’ve been thinking about this recently, and I don’t think it is unfair or bad. Having more money and wealth in smaller towns will in the long term benefit the town, no? If anything in the long term it will be terrible for expensive cities, since people will eventually gravitate towards locations where they can have more for less. Personally for me the most important criteria is finding great schooling for my kids, I don’t want them to have to struggle like I did for the first 30 years of my life.

Sadly some careers pay more then others but that’s life. It’s why I worry about the education system eventually crumbling, since teaching and in some countries even healthcare professionals are woefully underpaid. I wish it wasn’t the case but some people get lucky and others successfully follow the money, whilst society allows governments and or private industries to milk human kindness for as much as it can get away with.


Yeah I don't think it's unfair or bad either I think everyone should be making a whole lot more money and universally I think people should be getting money.


This doesn't make any sense. Your pay should be based on the value you provide to the company you work for.. Not based on whether it is fair to your neighbor or not.


> Your pay should be based on ...

So do you advocate uniform global salaries across different locations in different countries?


Even from a lefty perspective: people vary wildly in the value they produce. A society that paid based on output would be as if not more unequal than today's. Plus it does nothing for the people who need money to live but can't or don't do economic production: children, elderly, disabled, caregivers, etc. Socialists will sometimes emphasize the share of productivity captured by capital to argue for redistribution to labor as a class, but for individuals to be paid their own productivity is AFAICT not any serious movement's demand.

And then obviously from the capitalist perspective, your employment only exists to the extent that the employer derives more value from your work than they pay you.


This. For all the talk that says software benefits the world, software developers do forget what's the perspective from the other side.


Should and I agree.


The norm isn't location-based pay, it's location-based summary rejection. I think it should be clear why we accept summary rejection based on location.


I agree with you it's horseshit. What you're saying sincerely makes total sense to me. Has to feel terrible. I would feel detached from my work as well, I think.

You're experiencing alienation from the fruits of your labor. Your labor being exploited to maximize profit. Unfortunately, the comments here are right. It "makes sense" in the sense these experiences are characteristic of life within capitalism as a laborer.

Functionally, your location is being "colonized," so to speak, by capital. I don't know if there's a real phrase for it, but I suppose it could be described as "telecolonization." Management has found a resource (your labor) that can be cheaply extracted by alienating you, the "telecolonized," from the value your labor creates.

It is bullshit. If you want solutions, your recourse is either collective action/unionization or finding a new job. You're being exploited by capital more than your coworkers. That is the context from which this sense of unfairness arises, I believe.


You don't know the worst of it. In my country, it is almost always better to be "exploited" by US companies than to be "treated well" by local employers. Sad but true.

The USD exchange rate is just too good for exporation of goods and services. They simply offer more, despite the wage arbitrage. More money, more benefits. The typical US software developer salary is a truly ridiculous amount of money here due to the 5x multiplier, and even a fraction of it outcompetes every local enterprise I've ever seen.

I know exactly how it feels to see people in developed countries making 10 times what people here make on average.


Yep that uneven competition for labor prices is also exploitation.


> If you want solutions, your recourse is either collective action/unionization or finding a new job.

You really think they won’t just stop hiring people from that country if they “took action”? Or if they could get another job at a higher rate they wouldn’t?

My take on the subject is they are providing the OP with an opportunity which they otherwise wouldn’t have due to the current job market in their country in exchange for a rate of pay that is relative to said job market.

Maybe it sucks, maybe it’s unfair (it isn’t) but it is preferable to the alternative which is to not have a good paying job.


Would it be less exploitative if firms refused to hire people in lower cost countries?


Yes, because the workers would not be contributing labor to the company's output.

To put it another way: Yes, zero exploitation of OP's labor is less than "some" exploitation of OP's labor.

It clarifies things for me to replace "cheaper labor" with "more profitable labor". Why would a company refuse to hire more profitable labor? How could the company not having any relationship with OP exploit his labor more than hiring him as more profitable labor?


The employee is welcome to work for a local company at local rates. It seems they prefer the colonizer? Is that exploitation any more than the US employee not getting paid 2x or 5 or 100 their current rate?


> It seems they prefer the colonizer?

Sure, because the foreign company exercises their access to capital to compete at a wage level that local companies can't compete with, but is still as low as possible to extract maximum value from the investment made by purchasing the worker's labor. Why do you think there's such inequality in economic opportunity, such that exploiting labor in this fashion is possible, in the first place?

> Is that exploitation any more than the US employee not getting paid 2x or 5 or 100 their current rate?

I'm not making any comparative assertions here. You seem to be making the case (by implication of your question) that in your opinion it's good for OP he's getting the opportunity to be exploited. And I'm just saying, it's exploitation. It is what it is.


Actually I agree


You know why, and yet you were asking why.

> If the company is willing to pay me that amount in a different location, why can't it pay me the same here?


> Your pay is based on the cost to hire your replacement.

And my effort is also based on the cost to hire my replacement.


Hiring replacements is such a primitive measure, usually done on salary. In reality, OP will have institutional knowledge that will enable them to be more productive than a new replacement. It takes time to build that up and will without a doubt cost much more than a replacement's salary.


Wouldn't your replacement cost the same, regardless your location? They don't have to replace you with someone from the same location.


They could, but if you’re on a team of 6, all of whom work in the same general area (even if remote), there’s a cost to hiring someone 4 time zones away, let alone 8 or 10.


Yeah, but then don't say that it's just the cost of the replacement. Say that the same employee is just worth that much more if they are working from B instead of A, for X and Y reasons.

Having said that, I am not really buying it. There are significant pay differences based on location even in the same time zone for the same remote work.


The problem on these threads is everyone is trying to boil a complex equilibrium of supply and demand across dozens of factors and billions of actors down to “it’s just this one or two things”.


> there’s no moral failing,

Sorry, but this logic needs to stop. If a company is selling a product online for a fixed cost to an entire region then the people who contribute to that product that do the same thing should be paid the same amount. That is, indeed, a moral failing.

If a company wants to pay workers less based on where they live then their product should be similarly cheaper. We just don't see this though.


You don't understand cost vs customer value.


Isn’t that how we got region-locked DVDs?


It is a negotiation not a fairness discussion (even though fairness is part of the negotiation arguments). I asked about it in my current job before accepting the offer and was able to successfully negotiate it. In your situation, it seems that the only way is to look for a new job.

Anyway, the way I negotiated was very simple. Basically a version of ”I understand that this is a good salary relative to my local market, but I am not even looking for jobs in my local market. I am comparing your offer to offers from other US-based companies that I received for remote work.”

That was it. The part of other offers was true of course (even if for companies that I wasn’t too excited to work for). No need to even reply to their arguments of “company policy”, “cost of living”, whatever. I only have to state my point of view.

There is also the topic of me not receiving benefits like health care and 401k and other stuff that American employees get. I didn’t use this argument (didn’t occur to me), but I have the impression that this was considered in their calculation in how much to raise their offer.


It's 100% correct that's simply a negotiation, and this is another variable. But if you came at me and told me I had to pay you what I pay my US employees, my first response would be "alright, but you have to work US hours and speak perfect American English." Honestly, that's a good part of why we try to hire in one general area, in this case the US. There is a real cost to foreign developers who only speak passable English and who work on a schedule that has little or no overlap with US time zones.


There is a lot between "passable" and "perfect" American english. I have far from "perfect" English, but in all my jobs as software developer for american companies (3 so far), I got great feedback for my communication skills. Mostly, being remote, is written communication, but still.

I am close enough to US timezone (Brazil).

So, I guess you would be paying me what you pay US employees as well :)


> There is a lot between "passable" and "perfect" American english.

Agreed.

> I am close enough to US timezone (Brazil). > So, I guess you would be paying me what you pay US employees as well :)

Works for me. I have no particular prejudice against any culture, my concerns are entirely practical. If you can participate in meetings during hours the rest of the team will be awake, and your English is good enough that everyone can understand 100% of what you say, you have equal value to someone sitting in the US.


> you have equal value to someone sitting in the US

In a remote-only culture.


Sounds like you should hire Canadians!


We do have a Canadian office, in fact, though admittedly I don't think our company makes any effort to hire from there. At least nobody in my division of the company resides in Canada. Yet. One of my immediate coworkers is holds dual US/Canadian citizenship by birth and he is in the process of transferring his employment to the Canadian office because he is uncomfortable with increasingly acrimonious tribal politics of the US.


How much is the pay differential between the US and Canada offices?


Definitely surprising it’s taken so long for this to take off. But maybe because CA has a tiny population probably too small a pool?


Many people don't consider Canadian English "passable" :)


We're quite willing to misspell "colour" for US rates!


The true crime is pronouncing "Java" to rhyme with "have a". Hearing someone say, "JaaavaScript" is a traumatic experience :)


if you can stop pronouncing "south" as "soath" we might be OK with it.


Great advice on negotiation. I'll definitely use this going forward. Thank you!


It's a BATNA

https://en.wikipedia.org/wiki/Best_alternative_to_a_negotiat...


> I am comparing your offer to offers from other US-based companies that I received for remote work

If you go this route and you don’t have any other offers, are you willing to walk away or will you settle? Or if you do have those other offers, are you willing to take one of them instead of the one you’re currently negotiating?


This is the reason why remote companies have cost of living adjustments. They don't want to compete with other remote companies but nothing is stopping you from just applying only to remote companies.


Where do you even find these remote US jobs, they are either some big US companies that have local offices or US startups that don't take non-US people?


Big companies mostly only hire where they have offices, and almost none have offices in Brazil. So small startups that hire globally it is.

I find these jobs in either HN's "Who is Hiring?" or AngelList.


Good advice. I do think the arguments these companies use is ridiculous. I think it's possible that these companies are knowingly exploiting OP because he comes from a lower economic background. I say this as an Australian where tech jobs here pay about half or a third as much as a US startup job yet I've never had any startups try offer me an Australian rate.

I wonder if there's more to this story? E.g. does OP work for a consulting company, an outsourcing company, freelance, does he use project-based job marketplaces? I am just wondering the situation.


I work for a software company that's product based BUT I'm not in a software role as some people are assuming


The first line of your post says “Recently I got to know the pay scales that my peers and even junior developers are getting in the US/EU”. Why mention junior developers if you’re not in a software role? Are you also mad about the salaries of dentists in Canada or lawyers in Japan?


Kind of depends what you are getting paid, but if it is less then $100k say, you can easily find remote jobs that pay more, play them off against each other. The companies are using sharp business practice to get you as cheap as possible, you can do the same to get as much as possible. Apply for 100 remote jobs, interview, smash the interviews, ask for top $ from all of them.

See https://remoteok.com/, etc.

If on he other hand, you are paid $200k and the colleagues are being paid $400k ... well you are well paid, might be harder to get a fully remote pay rise, but not impossible I think.

Now lets say you are paid $50k for argument sake, and you talk to your boss saying you want $100k and you can get that elsewhere. They would be crazy to let you go as $100k is still probably less than they are paying in the US if you are doing the same job.

What I have learned is the 'policy' evaporates under enough pressure. Of course they may still say no, in which case look around.

If they are paying you less than you are worth, they are not your friend, don't feel bad about moving to another job immediately.


> If they are paying you less than you are worth, they are not your friend, don't feel bad about moving to another job immediately.

This 1000℅. Honestly, even if they are paying you what you are "worth", remember the company is not your friend. (You may have friends that work there and you may feel loyal to those beside you in the trenches. That is great! But never forget that the company does not exist for your sake and you do not exist for the company!) Do what is best for you and your's and do not feel bad about it!


>Kind of depends what you are getting paid, but if it is less then $100k say, you can easily find remote jobs that pay more, play them off against each other.

Someone from Asia who is pretty good at their work can get a fully international remote job that pays north of 100K USD? Is this practically possible or is it super difficult like say getting into MIT or CMU. I'm asking because this seems farfetched and I have no idea how these things actually do play out in the real world.


I am in Tokyo, working for an SF-based startup, and am making $180K/year. Translated into yen, it's about 2 or 2.5 times the amount I could hope to get locally. Full disclosure: I have no university degree, and am not a guru/superstar/10x engineer. I am intermediate-senior and competent, no more.


Do you mind me asking: Did you get that job through a job board or connections?


Job board, no relationship to anyone at the company … they reached out to me (my resume was available on the job board).


Do you have some specific skill set or lots of experience in a domain the company was looking for?


React!


Asia is a big place. I'm in Eastern Europe, $100k is very possible when working remotely. Also, $100k is an outrageously good salary here - think 5 times the local average.


But 100k or, actually, 50k is very high for outsourcing countries. There are many talented and senior programmers working for less than 20k; the thing is, they wouldn’t pass the ‘modern’ interview practices of western companies. Language or culture or both prevents them from getting passed even the first step, and many companies have nonsense processes in place that require many steps over many weeks. It is a competitive advantage these days, in the west or elsewhere, to not interview at all outside a 15 minute chat; people will drop their wages considerably, in the US, EU and elsewhere, to not go through (often humiliating if they are senior devs) interview garbage I have noticed over the past 10 years or so.

100k is high though; 100K in the eu is still not common at all. I know many people (with uni degrees and senior engineering positions) in Nl/uk/de who would switch jobs today if you offered something that. If wfh and reasonable interviews of course.


Possibly: 100k is probably high(er) than it used to be because of exchange rate changes too. That is 87000GBP or 100000EUR roughly! I am in Sydney Australia, pay is higher than Europe, maybe on par with London, and lower than US tech cities or those "crypto" fully remote type jobs.


> They would be crazy to let you go as $100k is still probably less than they are paying in the US if you are doing the same job.

But they wouldn't replace him with an American for >$100k, they'd replace him with another local for $50k.


When I look for remote jobs, it seems most of them require to be in the same country or the salary isn’t that great.


If I am hiring outside the US, I'm doing it to save money. I'm willing to accept the downsides -- schedule differences, language barriers, etc, in order to save money. Otherwise I would just hire someone in the US. So if a foreign dev were to tell me I had to pay the US rates, I'd pass.

I think you should negotiate for as much as you can, but it is unrealistic to benchmark yourself against US employees of a US company based strictly on your skillset without any appreciation for other perfectly valid factors.


As a non-US worker I definitely agree. My big advantage over US-based employees is that I'll work for less. Why would I insist on getting paid exactly the same as a Bay-area employee when I could ask for significantly less and be well ahead of what I could make locally?


I was going to ask exactly that. Don't people in tech in the bay area work on average something like 60 hours a week?

Barely anyone in Europe is working more than 40 (or 42) hours.


This is a common thought but it certainly hasnt been the case at any of the bay area startups or faangs I have worked at or interviewed for. Always 40 hrs.

Are there super heavy hustle places? Probably, but most places realize more time is not linearly more output for creative/knowledge work.

(Similarly, the internet would have you think anywhere offering "unlimited vacation" is a scam but I used and loved it)


Even goes that far that companies fire first in the US and then in other locations (assuming same performance).


Same, and I hold certain cultural biases too. Which is horrible, but also learned experience. Certain countries have stronger low level programmers, some cultures make for poor leadership traits, while others seem to create amazing UI/UX skills. Understanding there are no absolutes, and people are people, I just continue to observe some countries produce interesting niche skills.

Like in my home town, C# is king.


Which country or countries do you see that have great UX folks?


I've said this before: it's not really that there is some inherent thing about being from a country that makes people better or worse. But it certainly correlates, because of education, etc. I (and most remote north America workers) could go live in India and get the same money I do now. Nobody cares about location, but they do care about the labor market based on skills and education, and that's what they are hiring from and that's why people get paid less.


And what are you going to do if that dev moves to the US while working for you (such as on a partner visa)?

Are you going to pay them more or fire them? I don’t work for less as an American Expat, I work for how much I’m worth (which is a lot more than local wages) and I live where I live because the money let’s my wife stay at home, in a nice house in a nice neighborhood instead of us both working our asses off just to have a decent house in a shitty neighborhood.

If you want to pay local wages, go be a local and hire locals.


I had an interview a few days ago and I asked something similar. I asked about the possibility to travel to the US to greet my coworkers and work alongside them.

They said they won't raise my salary and they expect me to stay in my region (Latin America). They also said that if I go to the US or Europe, it would be though to live there with my remote salary.

It felt somewhat insulting tbh. As if they said "we want you as disposable cheap labor, not to become a part of the company" directly upfront.


Exactly. Alienation from the fruits of your labor. It's disgusting we expect people to tolerate it, and act like it's not a totally optional choice by management to exploit labor resources to get a better return on investment for the already wealthy. A modern take on colonization.


It's a choice by management,but it's an obvious choice.

We should not expect everyone to be a horrible person, only motivated by profit, but we also should not expect people to act against their own interests all the time.


Following profit motive doesn't make one a horrible person. People operate rationally within the rules they're constrained by (e.g. capitalism). I just think we are capable of making better rules.


On the other hand, the only reason the company hired someone overseas was to save money. They would not have even considered these candidates if they weren't hugely cheaper. Instead, the company would have hired from the local labor market instead.

What the submitter should be asking themselves, is whether they can pull a higher wage working from their current location with any other company. If they can do that, they should. If they can't, and it's likely that they cannot because most companies are operating similarly, then they're getting a fair market rate for their situation. That's the free market.


Well, we agree that "cheaper labor" is desirable because it's more profitable to the company right? So let's apply transitivity to your first paragraph:

"The only reason the company hired someone overseas was to make more money. They would not have even considered these candidates if they weren't hugely more profitable. Instead, the company would have hired from the local labor market instead."

Yeah, what you are describing is practically the definition of exploitation of labor by capital, and alienation of the worker from the value they create.


> On the other hand, the only reason the company hired someone overseas was to save money. They would not have even considered these candidates if they weren't hugely cheaper.

Not the only reason: I have plenty of times hired people who had skills we needed and couldn't find locally. Sometimes brought those people over on H-1B, sometimes just hired them remote. And then if we had a few in the same area, opened an engineering office (though these days I am less likely to do that unless the folks really wanted it).


Yes, of course.

But it would be a great motivator if they actually bothered to relocate you in case you showed remarkable performance and added value to the company.

"We just want someone to work for cheap without prospect of progress" tells me that job will have a low ceiling for someone that wants to progress further their career


> On the other hand, the only reason the company hired someone overseas was to save money.

Ding ding ding - we have the winner here. In my company, all new headcount is from cheaper countries. We are no longer hiring in the US.


> I don’t work for less as an American Expat, I work for how much I’m worth (which is a lot more than local wages) and I live where I live because the money let’s my wife stay at home, in a nice house in a nice neighborhood instead of us both working our asses off just to have a decent house in a shitty neighborhood.

That is reasonable. But if you want to work on a schedule that is not the same as a US dev, then you are worth somewhat less to me. E.g. South America would be fine, India not so much.

> And what are you going to do if that dev moves to the US while working for you (such as on a partner visa)?

When we have devs come to the US on a visa, they are actually switching jobs to a US role. They don't come here unless we have an opening. Then they are able to compete as any other US candidate. It does happen periodically, but not too often.


> But if you want to work on a schedule that is not the same as a US dev, then you are worth somewhat less to me.

Wow. So, a programmer, sitting in a seat during certain hours of the day is what makes a good programmer?


Not GP, but a programmer working the same hours as the people they need to regularly collaborate with is worth somewhat more than that same exact person working the other side of the clock.


I disagree.

There's nothing like working with someone who is only a couple of hours overlap. Progress happens 24 hours a day, and never stops to sleep except a short 1 day weekend. There's nothing like waking up to find the interface you defined the day before already implemented and a quick chat/meeting to figure out what was done and needs to be done.


Actually many companies will adjust salary if/when they bring you to the USA (usually, not initially to the same level as an equivalent American worker).


I agree with this in general but it depends on the individual. If I were looking to hire someone who was extremely smart/an expert on X I'd be focused more on their value:cost than location.

But for large tech companies that's not how you're hired - a body is needed to fill head count and the overlords determined that this particular position was better filled by a body in a cheaper country. Even if you do turn out to be very valuable to the company, the system is not set up to accomodate that scenario (and realistically, if you leave, the company can just hire another 5 people and hope to get another very valuable person among them).


I don't wish to sound harsh, but you've got selective blinders on to the arguments that favor your position. And your position is arguing from the point of view of someone who already has the benefit of a job in a company and asking the company to justify itself why they don't pay you more.

Here's a different point of view.

A company can choose to consider people for work either close to their offices or remote. People who get hired close to offices come with an expectation that they will go in to work at some point, and be collaborative and possibly more effective than people who are remote. This point is debatable, but is up to the company to determine for itself whether it's true or worth the premium. There is a limited set of people living close to offices, and costs of living are generally higher, and pay reflects those factors.

If the company is to consider people who are remote and are not going to be coming in to work, that opens up practically the entire world for them as a labor pool (modulo time zone issues, etc). People in many other countries get paid far less and are willing to do much more work for the same pay than in the US.

If you are remote, you are competing against the labor pool that is similarly situated. If you can show that your value is disproportionate to the average, maybe you can negotiate.

Try to reason through things in a way that reflects more objective reality rather than your perception of it, or your feelings. No one is "forcing" you to migrate or do anything. You are seeking high pay and remote work. You're totally free to go out there and find the company that's offering that. Your company is offering pay and a job, at rates that you can decide to accept or decline. You make your choices, and either feel good about them, or not.


How do you know he's working remotely? When I moved out of London back to the EU I was offered the same job in the company's local office, except it also came with a "salary adjustment" which meant they were going to pay me a fraction of what I was making.


Your company is gaslighting you. None of those reasons are valid. The first one is the closest to the accurate answer, but the real answer is "because we can hire people in your area for this rate". Try contracting, for a US company, for US rates; set a rate that's comparable to what other US contractors charge, and don't take clients that want to negotiate your pay based on your location.

You might also try building some reputation on Open Source projects with a strong community, the type that's regularly being hired for. Get referrals from your colleagues in that project for people looking for employees or contractors. Cite the rates your colleagues make, and don't accept location-based reductions.

(Also, make sure you have a job or contract lined up before you leave, unless you're really confident you can get one at the rate you want.)


As a web developer, I would really like to get involved in Open Source software and give back to the community a bit.

But the amount of options is overwhelming tbh, and the skills needed for open source projects are far from the backend API's the industry usually needs.


It is simple economics and markets in action.

It appears you are probably employed somewhere in Asia and you are comparing with similarly titled roles within your company/outside your company in other geographies like US/EU.

Salaries are generally local labor market and demand-driven. Think of it this way. If you leave the company, chances are the company backfills your position with someone having the same job skills from the same local market. If there is a certain supply of labor force in your local market at a certain salary level, your company is going to use that to peg your salary; not the salary level at which they get similar skills in Amsterdam/London/New York/San Francisco.

Also, if the company has established offices in say US/EU and India, they are trying to play a cost arbitrage play. Certain goods/services cost higher in US/EU and lower in Asia (and vice versa too). Labor costs are higher in US/EU compared to Asia (most locations).

Unfortunately, this is the norm and has been for centuries.

My advice:

1. Stop doing exchange rate conversions of foreign labor market salaries for the similar positions and losing your mental peace.

2. If you are in a position where you can immigrate to the foreign country, consider doing that (if not permanently, at least for a few years).

3. If that does not work for you and if you have selling/business development skills, you may consider freelancing for clients from the US/EU regions and bill them as a contractor at rates they are used to domestically (this is a whole another ball game and you need to build a client roster and work may/may not be steady).


Immigration is not currently possible. I'm still quite new to the work force so i guess I'm being easily affected by these thoughts.

The contracter route seems feasible and actionable. I'll give this a serious shot. Thanks for bringing this up.


I see multiple upvoted posts that the pay is based solely on "cost to hire your replacement".

But in some companies, after they decide to make an offer, it will be "how much to get you to accept". So that wouldn't be a function of their options so much as a function of your options.

As to how the calculus changes when it comes to retention, in your company, I don't know.

(Tech companies overall are famous for being good at luring talent (e.g., huge pay bump from current place) but bad at retention (e.g., small raises that don't track with market and value to the company). Hence the common practice of job-hopping frequently, and all the long effects that might have on software engineering practice (e.g., resume-driven development, and people not around long enough to see how engineering decisions play out).)

Do you trust your manager to deal with you in good faith, to have your best interests in mind, and to represent you competently with the company machine? Maybe see whether your manager thinks the company is paying what the processes (not necessarily individuals) implicitly think is what they can get you to accept, rather than what it would cost to hire and retain someone who could provide as much value to the company. If it's the former, see whether that sounds exploitative to you and your manager. If it does, maybe manager can look into whether something leadership wants to reflect upon, and see whether it can do anything to improve that.


> it will be "how much to get you to accept".

I hope my HR department doesn't act like that because it will be suicidal in the long run. Colleagues talk and salary details most certainly are shared. Once someone finds out what other person is making, it is a potential legal landmine because the company is not paying equally for equal work. Just imagine that a man takes a higher salary to accept than a woman. Suddenly there will be charges of sexism. Now play this scenario for other protected categories like race.

Location based pay is legally accepted so companies have nothing to worry about.


The answer is the same here as for anyone else who wants a substantial raise. You need to find a new job. It’s possible your current employer could match a new offer or even pay you more, but first you need to show them you’re serious about leaving.


I second this. Another option is the one Manish Pabrai took: do just enough work to not get fired, and spend the excess time and energy building your own business.


I think it's important to consider the downside risk here; your current employer could consider your code and business that you made while being on their payroll as their own intellectual property and fight you in court for that. Even if you have an airtight contract, they can still litigate it, and spending time in court will detract from your business and cash flow. Meanwhile, taking some time to go interview at other companies is much lower risk, but can still yield a large increase in pay.

I'll also suggest treading carefully with "just start your own business". My read is that the first 3 months will be "program 14 hours a day and make something awesome", and the rest of your life will be meeting with customers and preparing slideshows for your board. If that's what you want out of your career, you should definitely do it. If you just want to be locked in some basement writing a lot of code for a lot of money, you probably want a non-customer-facing engineering role at FAANG.


This is only a good advice if your own business works. If not you are wasting your time.

Also you dont know where the "enough job" is going to be rated. Your manager will determine that


    I've raised this issue with my manager and they've told me that I can 
    transfer if i want those pay scales but that's not a possibility for me. If 
    the company is willing to pay me that amount in a different location, why 
    can't it pay me the same here?
Get another offer or several and then have this conversation again. The equation changes considerably for your manager when you are talking about leaving for a better offer. Right now he has you as an employee for a price that saves him money. When you have another offer he has to weigh losing the knowledge you have built up about the job and the business, Locating, Interviewing, and Hiring a replacement against paying you a higher wage.


I think there is a major competitive advantage here for small employers that know what they are doing. If you are running a small US/EU based company and you find someone great in an offshore local, then you can dramatically increase their loyalty, motivation, and potentially output with relatively modest and reasonable raises.

I fully understand that larger organizations make the transition to an MBA bean counter mindset that attempts to homogenize and commoditize employees, and I don't have any suggestions to change this status quo.

But small owner operated companies don't have to play by these rules. If you are leading a small technology company you should be well aware that there are huge differences in output between employees and your ability to actually know your people by name along with each of their strengths and weaknesses is information asymmetry that you have over the bigger competitors.


Took a pay cut to go and work for a small nonprofit (~100 people). Best decision ever!

There is no reasonable amount of money I would accept to return to my previous cooperation.


The reasons they gave are lies. They're paying you less because (they think) they can. That's all there is to it.

Another reason is because they know where you live, and the salaries in that location. Keep that in mind when someone says they have "nothing to hide" - this is how companies use such information. To better determine the absolute minimum they can offer you (or maximum they can sell you).


And they have publically published those lies like it's something to be proud of? Reading the link my manager shared with me about these reasons, which is publically accessible, made me want to puke.


Well, calling them "lies" is a bit out there, but not entirely incorrect, rationalizations is probably the best way to describe it. The reason it's done is because people where you are from take those jobs at these rates and aside from maybe a different tax burden specific to your country, that's about it.

I don't know the size of the company or how the split is regarding the area you're from and the US/EU but they might have allocated budget to employment counting on this split and not be able to pay for a generalized change, hence why they'd offer if you moved, but offering while being where you are could be "dangerous" as other people in the same position as you might ask for raises as well.

I can't make sense of the "trapping" argument however.

Now, those are the reasons I can see for the policy to be in this way, you are free to disagree, as do I, but the only real answer is going to come from the higher ups. If it's a public company sometimes these kinds of things are listed in their releases with some notes, could be another place to look at.


"The reasons they've given me are weak and I want to debunk them."

Why do you want to debunk them? Is it:

A) You believe you can change the policy, and thereby get paid what your US colleagues get paid?

B) You want to validate your feeling (that the situation is unfair) and be certain that you are right?

C) You are curious about how the world works?

D) Something else?

(FWIW I've been in the same situation, working at a FAANG company outside US/EU, with lower pay scales.)


I can tell you're in India. Just a few thoughts from a fellow Indian:

- You are dramatically underestimating the cost of food and energy in Europe and America.

- Countries with free functional education and healthcare have a much higher effective tax rate than India.

- With the exception of Mumbai, a senior software engineer should be able to afford a house in any Indian city. If that is not the case, it's very likely that you are getting short-changed. And keep in mind the median sales price of houses in the US from April to June was 440k USD. That's more than 3.5 crores.

- The pay difference between India and the West for software engineers has shrunk dramatically over the past few years. If you've been at the same company for a long time, maybe it's time to switch.

- Top up health insurance is cheap. There really is no reason why an illness should financially ruin you.


The OP mentioned he is not married. Allow me to add: his personal life would be much more entertaining in India than in SF.


Please don't see this as a lack of empathy, but I think the only solution under your control is to apply to other positions and leave when you get a better one.

And if you apply to many and can't find a better one, then try to see it as 'they pay me better than anyone else' rather than they pay me less than others in the company.

I believe (but have no evidence) that smart companies will minimize the location differences to get better talent and will get a competitive advantage, but you may need to search ...


> even though we do the same work

This is dubious. I see a lot of "I'm doing the same as him/her/that level but only getting paid x" and it's often not true. Either in terms of responsibility or expectations (for example nobody really thinks an offshore / outsource provider will deliver the same as in-house) you are probably doing less. The solution is to get the job you are comparing yours to.

Edit: this comment posted at the same time as mine is saying exactly the same from an employer's perspective: https://news.ycombinator.com/item?id=32718612


This also applies locally in a single office.

There where times in my life when I thought I was hot shit. And if you only looked at Jira and git, I WAS good, but I was also green and lacked a lot of knowledge and wisdom compared to more experienced coworkers who I assume got paid more.


Which scenario are we talking about here? Is it:

You live in a poor country making $50k-$100k, and the US devs are making $100-200k.

You live in a poor country and get paid sub $30-50k, and US gets paid $100k+?

I used to live in Ecuador, and the “official” min wage monthly is ~$300USD/mo. So essentially you can hire a full time nanny, cook, etc for sub $1200 easy.

That’s never going to happen in the US with less than $400k+.

So in US 150k+ is top 20% of income or there abouts. But in a random poor country, $100k+ is probably top 0.01%, right? What am I missing here?

Also what is your skill level and could you quickly replace this job with another at the same or higher rate?

Lastly, if you really want to move, there’s 30+ countries you could move to in the interim if you really wanted out of your country. Canada is relatively simple, there’s tons of Caribbean islands that can grant you citizenship for sub $200k, which you can then use to travel freely without visa restrictions globally. Same with EU countries like Malta etc.


> So in US 150k+ is top 20% of income or there abouts.

It's top 8% (92th percentile) according to: https://dqydj.com/income-percentile-calculator/


OP said they really don't want to move


The cost of living point is very valid. A great salary in Hanoi is most likely to be a very low wage in San Francisco. You can't expect an employer to pay way above the local market rate for a position. Bottom line, they will always find someone to work if they offer a bit above the local market rates. The salary, whatever miles away makes no difference.

As far as how to deal with it, look a round you I bet your salary is a very good wage for the area you live in. If not then find a job with a local company that pays better. Software developers get paid well all over the world relative to where they live.

BTW, even with the wages in Silicon Valley, most developers there can't afford a house close to where they work. Inability to buy a house with local wages is a common problem in the big cities of the world so it's not an issue related to your area alone.


> You can't expect an employer to pay way above the local market rate for a position.

This would certainly be true for a business where all the employees and clients are local, but doesn't have to true for a global company with fully remote jobs. If I'm providing as much value as an SF-based employee and demand a raise to 80% of SF pay, the company would be foolish to let me leave.


> the company would be foolish to let me leave

One thing I've learned is that companies are extremely foolish when it comes to compensation and attrition.


Is your cost of living anywhere close to what it would be in SF?

The average 1 bedroom apartment costs $3,060/month [1] or $36,720/year. The tax rate is high, and depending on where in the world you are, there are additional expenses such as healthcare that need to be factored in as well.

If we're only concerned with fairness in compensation, cost of living must be a factor.

[1] https://www.zumper.com/rent-research/san-francisco-ca


> If we're only concerned with fairness in compensation, cost of living must be a factor.

No. The most fair thing a for-profit company can do is pay people proportional to how much value they add to the company. If it's a lot of value you can choose to live in an expensive city. If not, you have to live somewhere cheaper.


Or they just take someone who is as good as you, but cheaper.

Companies are not social services, they don't aim to offer some welfare. It's a harsh reality, but their competition is not doing them a social service either. So everyone is doing their best to find the best balance which bring them the best outcome.


"the company would be foolish to let me leave"

Fundamentally, if they can find a replacement at a lower cost, they will. Businesses are about the bottom line. No matter what their size is. Fighting that truism will only lead you to frustration.


> if they can find a replacement at a lower cost, they will

If that was easy for them, they wouldn't have SF-based employees in that role.


This is not about the SF-based employees, this is about the roles the company has chosen to source in lower-cost regions. For whatever reason, they've decided that they are getting a lot of value out of local resources in SF, and some of that will be about being American, some of it about responsibility, some of it about liability and local laws that they can hold the employee to. When it comes to those roles they've based overseas, they've done for the sole reason of cheaper labor. If you stop being that cheap labor, they'll just hire someone else who is. If there is no cheap labor, then they'll hire a local in SF instead. It's really that simple, and I agree it's not fair - life isn't fair.


50% of SP is not OK, but 80% is OK? Honest question. I can think of principled arguments for equal pay and for fully COL-adjusted pay, but I can't think of any for equal-ish pay.


Change location based pay to gender/race/religion/veteran/disability/etc* and half of the comments talking about market dynamics will have a very different ring to it. The change will be slow if it happens at all, after all many paychecks and bottom lines depend on not acknowledging the situation. The best you can do is probably raise awareness in the meantime and not feel shame about being demotivated.

https://elsajohansson.wordpress.com/2017/09/13/what-does-a-w...

*people are as much in control of their religion and veteran status as their location


This sounds like Gitlab? It was my first thought as I read just this page below yesterday:

https://about.gitlab.com/handbook/total-rewards/compensation...


Your company is not your buddy. All these talks about cost of living adjustment is nothing but beautiful horse shit to sugarcoat the truth (below).

You’re essentially a tool they try to buy as cheap as possible.

Your job is to sell yourself as high as you can.

The good news is that both you and your company have freedom to choose and compete with other entities.

So the only way for you to fix motivation is not talking it through, but rather to learn winning in this free market game.


I agree with you that most of the general HR arguments don’t hold water and are philosophical at best. All they try to do is hide the fact that you are not paid the way you are because of your talent or efforts. In most EU/commonwealth countries you can thank unionism for the benefits you have.

For multinationals, one thing to note is the location of the employees normally has very little to do with the talent and staff costs but mostly tax, politics/corruption, networking, or leadership preferences. Employee talent and costs are really generally not the focus of why companies setup shop where they do.

It can mess with your mind, and feel really unjust when you know of US sized bonuses going out that equate to more than full time salary in other regions doing equivalent roles. Even staff that are generally mediocre can often wing it whilst others go over and above getting a pittance.

It helps my sanity to know that we are all just cogs in a system and it’s not at all personal. Salary is a cost for doing business in some locations and everyone is completely replaceable. Also AI is probably going to wipe the floor of us all soon enough…


> Employee talent and costs are really generally not the focus of why companies setup shop where they do.

I don't think that's the case. For example, there are plenty of large, mutlinational companies opening offices in Poland and hiring hundreds or even thousands of devs there specifically because you can get competent people for a fraction of what they'd cost in the company's mother country. Also, of course it's important for them that Poland meets the sane baseline you'd expect from a civilized country, in terms of infrastructure, stability, rule of law etc. - but once these conditions are ok, I think it's mostly about the levels of pay. Most companies at the top levels are ruled by bean counters after all, and they're are always looking for ways to increase profit (and hence stock value) - and reducing wages is a great and easy fix for that.


So true! I wouldn't even start telling that Google not just underpays polish employees but cuts on the RSUs claiming that TC is adjusted to location based pay.

In the end it turned out the whole non-US IT world is a sweatshop now. Not like it wasn't like this before, but with exposure from apps like Blind the 500 pound elephant is no longer to be ignored.

Plus, the whole crybaby about remote work being kewl is USA-driven cost/time employee savings rationale too. In Europe, remote doesn't make much sense because it's 2x times smaller than the US.


I’ve only ever seen it labeled as cost of labor, not adjusted for cost of living. The labor market where you are at has essentially pegged you to a certain salary.

You feel like a cog in the machine because you absolutely are one.


Paying a knowledge worker based on their physical location will soon become a relic, if your company does not realize this… quit and switch jobs.

If your job requires you to be somewhere physically, your compensation is tied to what it would cost to replace you.

In my experience employers rarely know what their Cost of Vacancy really is… let alone their Cost per Hire.

I expect this will change.


> Paying a knowledge worker based on their physical location will soon become a relic, if your company does not realize this… quit and switch jobs.

It's a relic since 20+ years. And the end result is this discussion. Prices ultimately go down, because competition is rising and companies have the power to pay less. And automation will drive it even more to the bottom.


> The reasons they've given me are weak and I want to debunk them.

Debunking them on HN is pointless.

The only way to debunk them is to find a job that will pay you what you think you are worth.

At least now you know the pay scales and should have an idea for what you are worth based on the work you can deliver.


Your labor is being exploited for profit more than your coworkers'. Exploitation of your coworkers' labor has a smaller return on investment than that of exploitation of YOUR labor.

Despite how flippant other commenters may be with the "bad feels" of this experience, feeling bad about being alienated from the fruits of your labor, and being, essentially, colonized by capital, is completely normal, human thing. Especially so right after discovering the extent to which your labor is valued less than that of your peers.

This sucks bad, and don't pay attention to commenters who are trying to convince you that actually it's fine because that's just the labor market. No, it's totally valid to feel bad about this.


It's in part the cost of living (which is a very valid argument) and in part basic supply/demand.

If there is an oversupply of qualified people in your country willing to work for lower wages, that is what you are competing with, not people in the EU/US.


nothing valid about it except that it's an established coordinated behavior of employers to reduce pay based on region instead of anything to do with value produced


Wages have never been based on value produced, at any time, in any industry.

Although there may be some coordination, coordination isn't necessary for wages to be unrelated to value produced, because that's the default condition. It would take some impressive central planning to have wages actually match value produced.

Doctrinaire economists used to argue that value produced sets an upper bound on pay, since why would a company pay someone more than the value they produce? But there are plenty of exceptions to that, discussed for instance in David Graeber's book Bullshit Jobs.


> Wages have never been based on value produced, at any time, in any industry.

Yep. The prices of anything (incl. price of labor) are never about the value produced alone. The delivered value only sets a ceiling on the price (i.e. no one will pay for something more than they will get out of it), but, if the commodity in question is abundant, its price may be very well below the value it creates. For example, drinking water is necessary for survival, so the value it delivers is essentially infinite (i.e. you'd give anything and everything for water if you don't have any and are dying of dehydration), but at the same time it's so abundant that its actual price is almost zero.


I'm just pointing out the coordination because it's typical for employers to shame workers for talking pay while engaging in it themselves and lots of people I know believe it at face value. Owners shame people over it because they're scared of it because it works

I loved Graeber/Wengrow's last book, transformative, need to read BS Jobs (do other yc folks read graeber? I know for instance he tears down a few points others like andreessen and horowitz take for granted as axiomatic to their ideologies based on a recent interview with them; pardon the surprise to see you reference it)


Graeber's essays come up from time-to-time. Philosophy usually gets upvoted quite highly.


> Wages have never been based on value produced, at any time, in any industry

Sales commissions can be value based. Equity or options as part of your employee package can potentially be value based for early employees.

Although there are a lot of stories of companies reneging when a great salesperson earns too much, for example earning more than the CEO in the case of my friend, or unsurprisingly Oracle being Oracle: https://www.courthousenews.com/oracle-hit-with-150m-class-ac...


Well, it is almost universal, because wages have always been based on the cost of living as it helps increasing profit, which is the raison d’être of for-profit businesses. This “behavior” however is more of a natural phenomenon rather than something coordinated.


Wages are in fact highly coordinated in industries and within hiring organizations (in contrast to among workers where any wage data sharing is shamed and many are uncomfortable to coordinate)


If this is bothering you too much, the best thing you can do is move to a local employer where the salary range is more to your liking.

You have to think from the employer’s standpoint: if they pay you US or EU salary, why should they not just hire in those locales where it seems the company has bigger presence, or is maybe headquartered. Why would a company take the overhead of maintaining an offshore presence if there is no benefit to it.

Moreover, you are paid the local replacement cost, as in what would it cost the company to hire your replacement in your market. Unless you bring a unique value to the company you will be paid local market rate. If you are unique, then you will be paid whatever you want.


I'm living in a country where the monthly minimum wage is $275, and I work for a US company with a good salary, at least in my country.

I understand the basics of economics, but I must say this pay gap is pretty disappointing for me too. Yes, I'm living in a country where the cost of living is much cheaper, but the same country is classified as "not free" by Freedom House. The only reason I still live here is to save money before I, hopefully, move to any first-world country.

I want everyone to understand that the cheap cost of living usually comes with restrictions on human rights and mental illness.


In the job market you are willing to work in, can you get the $s you are wanting? By that, I don't mean there's a possibility some company might pay you the $s, but that it would be reasonable to expect quite a number of places to pay you those $s. If not, then your market value isn't the same as it is in other locations. You already demonstrated in your question that there is value in a particular location, for you, family and friends. For companies, they operate in whatever locations they think is best and pay competitive $s for that location.


Location based pay is ridiculous and you shouldn't have to stand for that. You're right to feel resentful.

Find a role for digital nomads and make the nomadic decision to stay put while claiming higher pay.


I agree with you that it's unfair and senseless but it's market dynamic (supply and demand) with capitalism bend to it.

There are probably hundrends of people with your capabilities, where you're now, willing to work at your current pay scale and probably thousands elsewhere in poorer places willing to work for much less than you. Not to mention even more - who are as capable as you're - but lack the opportunity you have because things like infrastructure (internet access for example).

On the flip-side your colleagues are probably looking at you as a saleout - depressing thier already-high (to you) wages. And yes, they're absolutely right beause beside your skill-set, the company is saving money by paying you less and in addition to having more laverage on you. Remember the outsourcing debates in the past years? Someone else is probably saying you stole their job too! What do you say to such person yourself?

Even here in America, Silicon Valley salaries can be truly shocking for some of us outside the valley. I think it's a little unfair to us smaller campanies without millions of VC money to burn but such is life. If you started a company where you're - will you be paying American salaries?

I agree with you that you shouldn't migrate to get paid the same for the same job. Hopefully as jobs become location agnostic - we can only look into the future on how the market will change and balance out the unfairness you're feeling.


Thanks for this, helps me that people understand me and I'm not being very unreasonable.

From what I've gotten from my discussions on my post is

1) I will start looking for contract work. Not going to be easy, but the best way forward.

2) Use some of the negotiation techniques mentioned like bringing up the fact I'm not competing locally, but internationally

3) Negotiate with my company and threaten to leave? Not fully sure of this. More alligend to leaving anyway as I find the excuses for location based pay pathetic. Will be leaving as soon as I can.

4) Always talk compensation with co-workers


> Negotiate with my company and threaten to leave? Not fully sure of this. More alligend to leaving anyway as I find the excuses for location based pay pathetic.

You should negotiate, but do so from a position of strength and leave emotion out of it. The reality is that location-based pay is standard. This reason for this is labor market incentives. Whatever your manager says is not reality, it's just a story to try to placate you. How defensible the story is or how angry and demotivated you are about it is absolutely meaningless in terms of outcomes, and the sooner you come to terms with that and look at the situation from a purely rational perspective the better.

What matters here is how much leverage you have. The best leverage is having an offer in hand for more money. Short of that, if you are perceived as a top performer, that could confer some leverage, but keep in mind that location-based pay is probably baked into the cost structure of the entire office. You are likely better served by a strategy to demonstrate your individual value so that your raise isn't seen as precedent for why the entire location pay scale needs to increase.


5) Become indispensable in the role you're (before #3). This is true even locally - why should I as an employer pay you more when I can get someone cheaper to do what you can do.

6) While contract work sometimes calls for a generalist (#1 above)... try to be a specialist by becoming an expert in a high demand field(s). At that point you can charge whatever you want regardless of your location.

7) Don't exchange your time for money - get paid for your skillset (related to #1 & #6)


one way is to be good at integrating some common but specialized open source, for example helping companies who've adopted prosemirror (for features but maybe not their whole platform justifying an internal team)


I would not go with option 1 until:

1. You have more experience (why would someone pick you as a contractor?)

2. Get better at negotiation.

Your concerns are valid, but that you didn't have the answers is a signal you're not wise enough to go into the contracting world.


btw - drop me a msg on twitter (throwaway is fine), @aehlke if you'd like to connect on resources for going independent with dev work, I'm starting a full stack resource for this soon and would be happy to share. good luck


The reverse would be unfair as well.

If someone have to live in San Francisco to make 250k/year but pay a high rent etc. And you make 250k/year living in Ho Chi Minh that would be unfair to them. And would be a little bit unfair to your local people, the selected few (employees) able to work remotely would literally make 80x time the local salary.

There is no way to solve this problem, if you want your compensation to be independent from your local area. Become an expert, start being a contractor and cross your fingers.


value === value, fairness was never a feature in capitalism.


Exactly, and the thread is about the other side of the coin.


If in an expensive location and are compensated accordingly (such that it is possible to purchase a property), you are strictly better off than someone who does the same in a lower cost area over time. After 10-20 years the person working in the high priced location will own an expensive asset while the other will own a low priced one. If they liquidate all assets, all else being equal, the person who lived in the expensive location is likely far ahead financially.


The very concept of "fairness" won't help you and will likely hurt your efforts to succeed in life. Besides being somewhat subjective, a business must prioritize profit over fairness in order to survive in a competitive environment. Your employer will pay you what they believe (possibly erroneously) is their optimal for profit, modulo the legal environment and company politics.


I can fully understand your frustration. Out of curiosity, where exactly do you live (country)?

I think that you can frame this issue the following way: the pay in country X, compared to a richer country like US or UK or Australia, is a function of cost of living in country X, but also "competition" in country X. Meaning, most other jobs like yours in country X pay at a certain level, which is maybe 1/2 or 1/5 of what you get in the US. But employer knows that, and therefore doesn't have to offer much more than that to convince you to take that job.

Some of what your boss is saying sounds like BS to me. But the hard truth is that you don't have a lot of options. An alternative could be to do freelance work for US-based customers. If you're really good at your job, you should be able to get close to, or even surpass, the pay of a salaried person like you in the US.

I can humbly suggest you to read some books or blog posts on career development. Most of them, IMHO, are not very deep or informational, but there are some gems in the mix. Sorry I don't have one to recommend.


I feel the same way from Canada and that’s why I’m going to leave the country. It’s humiliating to talk to my American coworkers about my personal life


You can't argue with your bosses because they don't care about the points you make. They have the power and know it. You can migrate, or find better job. Maybe look into unionizing (no idea about your country).

I learned this a few years ago. I can make great arguments but it doesn't matter. The boss has his mind made up and he'll say anything, even blatant BS, to justify it.


Line managers usually have no control over what your initial negotiated offer is. Unless your line manager is the equivalent of director+ of course.


I agree that these are blatant lies. Unionizing seems impossible? I'm not sure what it entails and how would one even go about it.

Someone else mentioned about taking up contract work, which seems like something I can give a shot at.


Your pay is based on your value to the company. Things that diminish your value to the company: Being in a timezone different from the main office, speaking a language or dialect different from the main office, having different laws than the country in which the main office is, being in a satellite office where management's chain of command is less effective, etc. MAANGA companies set up offices in Europe because despite all of these hurdles, European developer salaries are so low that it's worth it. If you want to increase that salary, work on destroying some of these hurdles. Either work with your company to get a product moved to entirely European development (a good example is Ubisoft doing development of some games in US, some in Canada, some in France, etc.), or try to break down some of the barriers like timezone, and vote in politicians who aren't driven by protectionist Europe-vs-US mindsets.


Does this same logic also apply to the price of goods and services you consume? For example, when you go to a restaurant in your location, do you pay them the same as an equivalent meal would cost in US/UK? The chef there is just as talented as one in the US, and the value of satisfying a human's hunger should be the same irrespective of location.


Well the product this company makes is uniformly priced across all locations. So if i wanted to consume the product my company makes I would be paying the same price as US/UK.


Classic restaurant and cars analogies don't work mostly. While traveling around the world I find 'comparable' restaurants to be 'comparably' priced. I just returned from a country with a GDP per capita four times lower compared to the one I live in now. Yet prices in restaurants in downtown or hotel room only around 30% cheaper. Iphones, laptops are cheaper in US that basically everywhere.


Difference here is that we live in the digital world where location isn't a constraint to providing services.


OP said: > I've raised this issue with my manager and they've told me that I can transfer if i want those pay scales but that's not a possibility for me.

Looks like location is a constraint to them.


The only part of this that you have some control over is where you work. It sucks because I understand how you feel and what you are going through, but you will have to find a different job at a different company that pays more. That is the only thing you can change.

Your company has clearly communicated that they don't care about how you feel about this.


I, like you, don't like it the way it is when it comes to remote IT job market, but it's very clear how this works. In country X average full stack developer charges Y dollars, recruiters know what average pay is so they will only offer pay within same range (or sometimes slightly more, like 5% more). Companies look for cheap labor and will not pay more than they really have to.

Where I live now the top pay is around $100k per year (fully remote full stack, but similarly dev/ops). Extremely rarely (maybe once in a year) I see an advert paying $200k and since everyone wants to earn this much the competition is enormous. This also applies to FAANG who don't pay more than average market rate.

I don't know if my observation is close to reality but from what I see better paid positions are usually not going through public job boards but through word of mouth and through networks.


There are essentially three explanations for your lower pay

1) You're being paid less than your market price

2) Your colleagues are being paid more than their market price

3) Your market price is not the same as theirs.

If 1), get a new job. If 2), make peace with it. If 3), start to look at why that might be true. I know that a randomly selected remote engineer in the US is more valuable to me than a remote engineer in Eastern Europe who is more valuable to me than a remote engineer in India, for example. The US-based engineer has working hours closer to mine, has cultural context closer to mine, can more easily communicate with a customer in a live site debugging, and overall builds products with a "product sense" closer to what the US market desires. This is of course not true at the individual case, but is definitely true in the average, and a reason why domestic remote engineers will likely continue to be paid more than overseas remote engineers.


In theory I agree with the OP, but I am having the reverse problem now. My startup has an equal pay policy. I live in San Francisco and have a San Francisco salary, but cannot afford a home here without saving for many years and having a very lean budget.

Next to me are colleagues who live in countries where the cost of living is a fraction. They tell stories of the first and second homes they are building and how they agree with the pay policy. They are living a quality of life that is beyond anything I can have while living in San Francisco, and I partly resent this.

Within the company, people have and are still moving to low cost areas, because the company is fully remote. I however am married and my partner cannot as easily be relocated.

I don't give my company name here because it is very small with only a fraction or employees living in San Francisco.


One important point not discussed is that wages paid in a HCOL zipcode will be spent within said zipcode..it fills the tax coffers that funds the infrastructure of the corporations that have a ‘you-scratch-my-back-I-will-scratch-yours’ arrangement with the city govt.

Example: when Twitter and Lyft and Uber got tax moratoriums from San Francisco to establish HQ so the employees will move in and spend their wages and pay taxes and all the good stuff. Except SF dropped the ball. Vs. The South Bay has historically had a better relationship with the FAANGs..Apple or Google will never leave Bay Area. South Bay takes good care of Silicon Valley. And the favour is returned. It costs millions and millions to build and keep 880 et al smooth running.

There is no benefit to paying someone in a LCOL zipcode the same wages as as in a HCOL area.


3) something about not trapping in a high salary job - I dont even know what to say about this. I would love to be in that trap instead of the one I'm in right now where I'm being forced to migrate, where I would loose my family, friends and all the support structures I've built around me, to receive the same benefits as my peers.

You don’t have to agree with it, or think it’s barely reasonable, but you should understand the argument at least.

It’s not about worrying that you’ll feel trapped and that will make you feel bad.

It’s worrying that you’ll feel trapped and won’t quit even if you are very unhappy. Instead you will stick around and be a drag on productivity and morale. Companies would most like workers to be happy and productive, but if they can’t have that they’d rather they quit than stick around unhappy and non-productive.


I'll do you one better: at the start of 2020 I went to Switzerland for a contract and during the 2,5 months I stayed there (until COVID pushed me out) I made as much as in the previous year.

Back home I was working remotely in the same role for the typical local rate (well, +10%) until the end of my contract.

I considered moving there but then I learned that permanent employees aren't compensated as well as I was and kindergarten in Switzerland costs around 3k CHF monthly.

Also around here in eastern Europe it's common for a company to hire people at local rates, but charge the (typically US) client their local rates.

Bottom line is: Q4 is approaching - you might want to start looking for new employment now that slow season is nearing to an end.

Just demand 50-100%+ and watch out for those who have obviously huge markups.


> What do others think about this and how do you deal with this?

One word: counter-offer

Welcome to the world (plane?) of zero-sum games and adversarial strategies! Appealing to fairness doesn't help in this world - because the values and corresponding strategies of your management and yourself are fundamentally adversarial to each other - that is, your delta of profit is their delta of loss. People like to argue sophisticated game theoretical takes that serve to obfuscate this simple truth.

For a more esoteric take: You could as well model our life as a trajectory unfolding across a stack of "planes" - most common people manage to constrain their limited & valuable attention to "narrative plane" or "social plane" where the main "control points" (as in Bézier curves) are mainly various narratives floating around and signals of social (dis)approval applied to you. Compared to the harsher plane of adversarial game theory I mentioned earlier this social plane is much more fuzzy and forgiving (main message - be a nice person, get an average nice life). Yet for all its self-evident harshness, keeping one's attention away from the adversarial plane (where the main control points are hard decisions, often legally-powered, decisions bearing heavy financial and business implications) leads one to sub-optimal outcomes.

If you play this game by its true rules, your score will increase. That being said, I agree with the increasingly common sentiment that this is long-term unsustainable (sobering statistic: https://florentcrivello.com/wp-content/uploads/2022/09/image... ). Some solution is increasingly becoming necessary, and this solution is likely some form of UBI.

Why our politics is dominated by various local and global non-sequitur causes and not this sobering issue of rising necessity of UBI is an exercise left to the reader.


> Welcome to the world (plane?) of zero-sum games and adversarial strategies! Appealing to fairness doesn't help in this world - because the values and corresponding strategies of your management and yourself are fundamentally adversarial to each other - that is, your delta of profit is their delta of loss. People like to argue sophisticated game theoretical takes that serve to obfuscate this simple truth.

what is this, Das Kapital?


More like /r/cscareerquestions


It's easy to see politics as a series of non-sequitur causes when you esoterically model your workplace as a tree of maps where normal humans are reduced to control points on a biezer curve.

I'm sure somewhere near the start there was the intent to help OP and by the end of it we are talking UBI for some interdimensional reason.

Game theory and economics already exists if you want to model business relationships, without cracking open some vaguely esoteric metaphysical mess. Though I do enjoy a good metaphysical discussion.


Haha, this seems important but I don't fully understand what you're saying. Will need sometime to process this.


It's ultimately simple: many people, especially people from professional–managerial class (PMC) which keeps rising in its aggregate wealth & prominence during the recent past, will tell you (maybe in a comment section on HN or some other media) that using "counter-offers" as a career strategy is unethical, akin to blackmail. This is a (often performative) niceness narrative common to the social plane.

Be aware that it very well could be the same PMC people who consistently use various tricks to lowball (google it) offers for productive people like you and me in their day to day hiring practice, simply because they can - this is the logic of harsh business plane.

There is no contradiction here.

Counter-offer is something you can use as well.


You need to start looking into the skillset necessary to get US pay without needing to be in the US - it's not an infinitely big market but it is there for the taking.

This is an extensive topic I cover for the LatAm community in a podcast - Tecnologia informal.


One major difference is that in some countries (many EU countries) payroll taxes are much higher than in the US, where most income taxes are paid by the individual. So while your quoted salary is lower, the cost to company difference is less stark - your country just makes you pay higher taxes.

Another difference is that tech companies are expanding into countries like yours precisely because it's cheaper to hire people. Not to be an asshole but you see this in the types of projects that cheaper countries get in large multinational tech companies compared to the major hubs too - less direct product work, more things like internal software, tooling, data/devops pipelines, etc.


Well, its mostly your fault. Start demanding more, if you are locked into your current job and can't see yourself getting a raise, move on somewhere else. I was stuck with low European salaries in my first year as Developer. In my second year I quadruppled that salary by setting my lower limit 4x higher and moved to south-east Asia to lower my cost of living by half. My old-colleagues are still complaining about the high costs of living back home, and the low salaries as well. While they would actually be more senior and even more productive in the job I got after leaving them.


> What would the company gain if work from a different location that they would pay me more?

More that if you are in a different location, they pay you less. You are flipping the default here, which is almost certainly American salaries.


Sorry I forgot to mention that I'm not from America, so moving there or to EU would increase my pay.


1. Your excuse here is not good enough to debunk this excuse. Cost of living is a general cost for people living in that location. Family support is not available for everyone. If you move to this location, you will not like if they use family support as an excuse.

Location pay also affects the amount of taxes to be deducted.

2. I do not understand this. If your manager thinks you are not as talented as your juniors then you have to find a better work place.

3. Again, this seem subjective. However, you are sounding like you do not have any option. If you do then use it, if not then be grateful for what you have,


Organize. You are right. However, there is no easy solution for one individual. Right now you have zero bargaining power.

Together with the rest of the workers in your location you would have a bit of power. You would likely win concessions, though also a good chance of them closing your location entirely. Bringing in your higher paid coworkers could be quite strong, but that might be a tough sell.

Organizing with many others across your country and you might start getting somewhere. Transnationally, even more.

Best wishes.


It depends on your size of company. You might get a small company doing a one-off equalization that pays you way above the local rate but the reason most companies have presence in foreign markets is that labor is cheaper. When that labor increases then they move elsewhere to keep costs down. It's the whole reason for having foreign locations for most US companies. If it got to the stage where wages are starting to get such that the RoI isn't there then the company will pull out and bring the jobs home.


The main reason a company pays a person in one locale more than another, is that what it costs to retain that person in that locale. If you want a good person in the bay area or is going to cost more that a person in another area. Cost of living plays a part. But it is really about the other competitors in the area. But honestly don't be resentful. There are a lot of headaches in the higher pay areas. Like traffic is worse. Is the extra pay worth it? Maybe, maybe not


I'm going to generalize here. It's important to note that there are exceptions, but they are _exceptions_.

You're working for a company, not a person. Companies exist as a way to make money: they have _no_ other motivation. Notions of fairness, decency, humanity, etc, have zero relevance to corporate behaviour. People who work for companies are actively discouraged, even prohibited, from using human morality or fairness as criteria in deciding what to do: corporate decisions are about the short-term financial gains for shareholders.

Employment policies exist to codify the processes used to achieve this goal, because people a fallible, and tend to have moral scruples, and that gets in the way of perfect implementation of the corporate will. They're necessarily a blunt instrument, with inefficiencies, but in a company staffed by humans, that's the best it can do.

The costs of employing someone have several parts: salary + benefits to the employee, taxes due to the locality they're employed, and the costs of equipment, services, office-space, etc, needed by the employee.

The goal of the company is to get the best/most output for the least cost. With some initial overheads (setting up foreign legal entities, structuring to support remote work, etc) foreign workers are often a means to this end.

The only reason the company talks about "cost of living", etc, is because that's what potential employees tell it when they negotiate (or refuse) a job offer. It doesn't care: it just knows that unless it pays that much, people will work for its competitors instead.

The reason you're paid less is because you'll work for less. And if not you, then someone else in a similar location. If the company can get more output for less money elsewhere, it will. The only reason the company has local staff is because it believes that not having them will ultimately cost more (in quality, in agility, in reputation, whatever. Often this corporate belief is biased/racist).

So, what to do?

Find a company that realizes that the best people are not all magically located in California, and is prepared to pay more so that it gets the benefits of your work rather than one of its competitors. As other commenters have mentioned: in negotiating your salary, point out that you have other options, and if they want you, they need to be willing to out-bid their competitors.

But your current employer has limited scope for this: you really need to move. Once you're employed, the company counts on you being risk-averse enough to stay, even if you're relatively under-paid. The only way to level up is to move.

Good luck!


Tbh, I don't see a problem with this. Throughout my 10+ year career in India I've been paid less than my counterparts in the US, and probably less than a few juniors as well. However the difference has reduced significantly from 10x to 2-3x now.

Just because we all work remote now, I don't feel that there should be parity in our pays. I'd probably be pissed if a counterpart in, say, Bangladesh was being paid much more than me though :-).


Easy solution, get a p.o. box in a higher cost of living location, and use that as your 'business' location, base your pay off that rate. Make sure it's somewhere the company doesn't have physical locations.

Deceptive you say? Well, why do you even need to disclose where you live in the first place? Everything you need can be done remotely, again you can get a forwarding postal mail address from anywhere if they need to drop you snail mail.


So many small companies do this. I think over half of the companies I've done work for maintain a PO box and public phone number with a NYC ZIP/area code. None of them are in NYC, only one was in NY state. Why? Because NYC companies are more expensive!


It will be interesting to see what happens, as the tools for remote/async work keep getting better, workers get better at doing it, and employers get more used to it. To the extent that distributed teams compete well with single-location teams, wages should tend to even out.

Looks to me like this is already happening for high-end skills. And once those PhDs and 10x folks blaze the trail, it'll get easier for the rest of us.


Where are you based? If you are able to speak English well, the honest answer is that you can be making the same as EU/US based peers. But perhaps not at the same company.

Usually landing a remote position creates significant opportunities. My girlfriend, a talented senior designer, has increased her compensation nearly 5 fold from her previous work situation and now also works from home.

You ultimately get what you negotiate.


The solution is relatively simple, look for a job that doesn't do location based pay. Out of 8 offers I recieved earlier this year, three had location based pay, and I politely declined all three (ok, maybe with a little contempt in my voice) and told them that policy was the reason why. Your not here to change their policies, just move on and tell them why you did (after the new gig is secure.)


Pass some of the workload to the people getting paid more


> 1) cost of living - a lot of my colleagues are in locations where they can buy independent houses which are cheaper than an appartment in the city I live…………

Have you considered moving/transfering to another country ? You list all the problems there and you would benefit from higher income, free healthcare and housing opportunities

Focus on what you can change

Move to where the money is or find a company that pays location independent wages


If a company accepts a flat rate across the nation for their services but then pays you differently based on where you live then you should find new work. I came from an area where software engineers are routinely underpaid compared to their cohorts and the only thing I could do was leave and build up enough experience to work for companies that don't do geopay.


This is likely just a policy from your hr department on employees (or contractors).

You could work around it by starting your own company, have your employer contract with your new company for a given period or piece of work, and pay yourself from there. It moves some of the regulatory work from them to you, but allows you to charge market rates.


Borders bender the rich. It’s simple, it’s dumb


You often get told that you are paid by the value you produce but in reality you are paid by the replacement costs. To some degree they are correlated but companies will always spin this in their favor.

Sometimes there is also a discount based on time zone difference. If somebody is more than 4 time zones way they are harder to deal with.


Switch jobs to one that pays better or move


other resources - no judgment, just what I've observed in worker movements:

- overemployment: take multiple remote jobs, meet expectations on performance but not on hours-in-seat

- "indie dev" path with recurring saas/IAP is also worth considering but obviously doesn't work at scale to solve these issues (ancaps would have you believe that the solution is for every person to become a business)

- talk compensation with your coworkers (check your labor rights) and organize


Talking compensation has opened my eyes to this. We need to stop this culture of being secretive about compensation.


it benefits no one but the employer, and talking about it is usually legally protected (though look out for illegal retaliation). the ridiculous double standard of employers shaming workers for talking pay is that they all spend time and money organizing regional pay standards with other employers, whether through their VC firms, exec connections, or research firms. It's time we really take their advice to "act like owners".


Honestly, I'm very conflicted about this.

My issue is not directly with my salary. It's more with the fact the I'm being payed less when compared to my peers in other locations while I'm doing the same/more work.

Location doesn't influence output, why should it influence the pay scale?


because you're not being paid on your input, markets don't run on the labour theory of value. You're being paid for the lowest amount that you, or someone else, is willing to do your job, and that amount happens to be lower in a place with lower cost of living.

people earn more in San Francisco because the rent is a gazillion dollars and if they got paid Indian wages nobody would show up at the office.


> people earn more in San Francisco because the rent is a gazillion dollars

It's actually the other way around. Rent is a gazillion dollars because people are paid so much and the housing supply is very limited.


It's not just location that warps salary. I've worked with plenty of people senior to me that contributed less than me but got paid more. The only solution I've found is to change jobs


How do you judge ‘contributed less’? More senior people generally have more skill and a better understanding of the product, making them more able to make decisions that carry much more value to the business than labor from non-senior employees


The perception that YOE == skill matters far more than people would care to admit.


Senior is a title that conveys ability. Ability is more important than YOE.


Simple supply and demand. If nobody accepts the pay, it will rise.


This is best accomplished in coordination, just as employers coordinate against workers (whether illegal anti-poaching agreements or by sharing market data with each other etc.)


> felt more like a cog in a machine.

to be fair, you are. regardless of geopay or not.

comparison is the thief of joy. but if you must compare, do so against local companies.

you didn’t mention that the job stunk or was otherwise bad. just that you were paid less. if you don’t think the pay is fair, the course of action here is pretty obvious …


I think about it in terms of how much money I'd have left after all my expenses are covered with my current lifestyle. This includes Healthcare, education and travel opportunities. Once you account for this, the differences are easier to stomach, if still unfair.


Salaries are local.

Outsourced development and manufacturing are premised on this and other local factors such as government incentives and subsidies.

It is possible for contractors to earn equivalent hourly rates but remember then you don't get a monthly salary, and any time off comes out of your pocket.


$60k per year gets you in the 96th percentile here, and you pay ~25% in taxes. If you live here, it's really hard to convince companies to pay you more than that. It would be easy to blame my employer from a richer country, but the actual problem is at home.


Looks like the meme about the price of a bottle of water going around the internet has not reached some of us. There is no “true” price for water. Price is contextual. OP, you are in a contest for which your price is what your price is. Change context. I did.


"If the company is willing to pay me that amount in a different location, why can't it pay me the same here?"

Because capitalism. Or more specifically because your company has very little incentive to pay you more than the market rate in your locale, unless you give them one. You can either try to do that as an individual by basically saying "I'll quit if you don't pay me more" or you can try to do it collectively with your fellow devs by organising and engaging in collective bargaining. Both paths are risky because your local employer might call your bluff (how special are you?) or even if you manage to get a collective bargaining agreement, there is no guarantee the parent company won't take a look at your division, decide that the numbers no longer add up and offshore your job somewhere even cheaper.

"What would the company gain if I work from a different location that they would pay me more?"

Having you, pyrodactyl work from a different locations? Your employer would probably gain nothing. Having a presence and hence a team in another location with a pyrodactyl-like employee doing pyrodactyl-like things. Probably quite a lot. Which is why companies don't generally off shore the entirety of their development teams even though that would be cheaper.


"Having a presence and hence a team in another location with a pyrodactyl-like employee doing pyrodactyl-like things. Probably quite a lot."

Though this is absolutely true for traditional companies, this company is actually a fully remote one so they don't have a presence as such? I would just be wfh but in a foreign country? I still don't see the point in my perticular case


Get so good at something that companies would be willing to pay US/EU rates even remotely.


Because they can.

You're unwilling to move to be paid more, or find a new job (which might be hard, as most companies are acting as a cartel).

Look up BATNA, and decide what you want to do about the situation - don't expect them to do anything about it.


Accept it, while slowly looking for places that aren't hamstrung by location based pay


Price and salary are based on what people are willing to decline. If you’re not willing to quit because of the pay differences and none of your colleagues are either, obviously they are paying you market rates.


Silent duality here is that many engineers are being paid top-level US compensation without actually living there, sometimes 2-10x+ their local counterparts.

Their secret is negotiation. Many US-based large companies and well-funded startups that pay in those top ranges know very well that there are engineers in low cost-of-living countries who are just as productive for their company, so they will compete for those engineers.

The deciding factor in whether each of those individuals actually makes a regional salary or a top level salary (or anywhere in between) is purely based on whether they are willing to refuse lower offers and only accept the same pay the locals in top-paying areas like SF/NY do. Some employers will never budge, but many will, because you're still worth just as much as the locals they pay the same rate.

TL;DR If you've got the skill, only accept the top range of pay and that is what you will make.


Start your own company or become a freelance worker.


Not sure why you got downvoted. I travelled SEA and did some freelancing at Swiss rates. Now I live in Switzerland and earn internationally.

By far the best I could do for my mental health once the wage slave thought took over.


How did you find clients?


Upwork. However I sent like 20-50 way to detailed 'offers' for every client which was unpaid, frustrating and boring.

Also the platform only got worse over the years in my opinion. I haven't done freelancing in a while but last time I tried I got way more competitors working for even less.

However I didn't need many gigs at a Swiss hourly rate to have a nice time in SEA


Living expenses are an incredibly valid reason.


You wont be able to change their minds on a policy like this.

My advice would be to look around and find another position with higher pay.


I can share how much I'm paying for renting a shithole in London with you if that makes you feel any better :)


It appears you are located in an Asian, South American, African, or perhaps another region. I find it curious that you talk about US/EU compensation, when in fact Poland (which is part of the EU) has Google offices that quite literally pay a half of what Google Dublin pays for the same job, and Dublin in turn is a half or a third of what California pays, if not less.

I too have migrated away from my EU country to another EU country because USA is incredibly racist and getting a job there nowadays is practically impossible.

And I do agree. I've said for quite a while that Cost of Living is a scam to appease poor people. It is very simple: after paying housing, and bills, you are left with more disposable income in a place like Seattle than in a place like Warsaw, Poland. Notice that stuff like iPhone or EC2 instances have more or less the same price globally, so it is funny that these same companies adjust pay regionally, isn't it?

Anyway like someone else mentioned, there's no conspiracy. Companies adjust pay regionally because they can. That's it. I don't understand how more people aren't rioting and burning the streets demanding pay according to value produced... but that's almost communism I suppose?


The market for talent varies by location. Apply for new jobs if you think this is unfair.


why don't you find a counter offer (in other countries if salary is higher), maybe your company will meet you in the middle. It is hard to tell them you are important unless you are leaving.


It is ok. If you think that you cost more, you can apply for another job or migrate where it is paid more. If your employer and you agreed to this amount, it is fair. Pure economics. At another countries it is another costs of living. Difference in cultural aspects doesn’t is not an argument. Anyway communism doesn’t work.


You need to start setting demands, and move on.


Google "super exploitation".


Get another job. Plenty out there.


Move location, that’s what I did.


pay in EU is absolute vomit comapred to US, we are v. poor compared to yanks


Your employer is missing out by not paying by value. I suggest you find a new role at a new company.


Unionise or quit


Get a counteroffer. If your company likes you, they'll match it. If they don't, you can accept the offer and get that amount of money. Basically 0 downside for you.

I think there are a lot of companies that do location-independent pay, so you should look into interviewing at one of those. My impression from a cursory look at what I see on these companies blogs is that they skew very low for someone that lives in New York or San Francisco, but that doesn't seem to be your situation.

Another option is to just move. I think you come out ahead, as pay seems to linearly scale with the cost of living change, but many expenses are fixed. (For example, nobody says "every software engineer should have $1650 for their 401k, $3000 in pocket change, and whatever the average rent is in their city of choice". They say "We aim for $200k in NYC" and if housing is 50% cheaper somewhere else, pay you $100k. That means your 401k, pocket change, etc. scale down proportionally, and that's the part that's unfair. So move to San Francisco!)

You could also find a company that pays more in your desired location. Google's software engineers in Madison, WI probably get paid more than some random startup in Brooklyn, NY. Even if it's location based, you can still get yourself more money.

Finally, if you're contracting, nobody really needs to know what city you live in. For full time employees it's tough to lie about this because of taxes, and of course fraud is a crime. I definitely know of people that claim to live in Pennsylvania but actually live in New York City, for tax reasons. This is fraud and is illegal, but people do do it. Maybe location-based pay tips the scale towards "meh, I can do 5 years in prison with 10% probability". I'd personally avoid going down that road. If you're a contractor, though, nothing stops you from starting a company in a high cost area, billing through the company, and never mentioning (except to tax authorities) where you actually live. Again, I wouldn't recommend this as it sounds like a huge hassle, but everything can be gamed. The upside of contracting is that you're negotiating your compensation several times a year, instead of a handful of times throughout your career. The downside is that if nobody really needs your skills, you make $0 for that period of time, which can be pretty rough.

I think my TLDR is that I'm guessing you don't actually love your job, so you should probably find a different one. That's how you get paid more as a software engineer. Some employers keep their fingers on the pulse of the market and give you raises to keep your compensation within the %-ile that they decided, but 99.99% don't. So, you find a new job every 2 years. That's their fault, not yours. I worked at one of the 0.01% that did keep refreshing comp as the industry landscape changed, without me ever asking, and that was the job I worked at longest.


nobody wants rich remote-working assholes in their town


There's no real winning these on a point by point basis because the entire system of wage labor is set up to separate you from the value you create for owners as much as the market will bear. Employers agree with this openly every time they talk about how this is a market, though they avoid the charged language and obfuscate it by drawing focus to other ideas.

These kind of logical points from employers are not rules or based in any reality except for ones where they simply have power over you to suppress your pay. Hence why these "rules" shift over the years as standards shift in favor or away from workers. These are among myriad tricks for fighting a class war against labor and maximizing extracted value. The best way for workers to beat these pay systems is to apply organized pressure collectively, not for you to have a private conversation with your boss or HR.


Or they could switch jobs to a company that pays more rather than spending potentially years organizing which may not even work in the end.


they've been given a bunch of tactics. and sometimes it takes weeks rather than years.


My problem with these arguments is that there is supposedly a permanent class of “owners” and one of “workers”, and the workers are completely without agency nor ability to become owners themselves. Especially in software, a good idea can be converted into a business with minimal friction no matter where you live.

America has helped created more Latino millionaires than any other business through McDonald’s franchising model. These millionaires are now “owners”.

The Marxist class-based ideology ignores that fortunes are made and lost dynamically and your situation in life is not static. Even worse, once your viewpoint shifts to class-struggle you became a miserable defeatist lacking hope for the future. There is a reason communism died and Venezuela / Argentina are economic basket cases - once you view the economy as a zero-sum struggle, you start scheming to steal from productive private enterprise, and eventually everything collapses into shit.

My recommendation to OP, if you seriously want to raise your station in life, is to start hustling. Find a new job that pays more, start your own business, or immigrate to a higher paying country. No one is going to hand you anything. You have identified a problem - “my company pays me too little and I deserve more”. Option A is to give up, become demoralized, blame society, became a miserable complainer. Option 2 is to strategize about your situation and figure out a path to better compensation. Good luck!


You should be able to make a decent income and be treated fairly without having to take the risk and stress of business ownership.


There's a difference between an indie dev flipping an idea into a profitable app with their own hands vs say the approach taken by the Fast CEO. I didn't even get into ideology stuff or politics, only a material description of what he's seeing - but looks like you are repeating a bunch of rw talking points there without helping the OP.


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nah I gave OP a bunch of specific tactics for increasing pay that don't require them to necessarily rip themselves out of their current community and move etc. You're also getting needlessly and inaccurately nasty, you don't know me at all but you are happy to assign a bunch of labels to "my ilk" just because I don't simp for a boss. I'm also not a socialist or a marxist

edit: thanks!


Best of luck to your software development union collectively organizing to raise wages


The "anybody who objects or suggests improvements to the current system are lazy bums who just complain all day" is a trope as old as time.

Man I'm just glad not everyone shares your "praise the statu quo" mindset, or we would never have had any progress at all.


> My problem with these arguments is that there is supposedly a permanent class of “owners” and one of “workers”, and the workers are completely without agency nor ability to become owners themselves.

That's because there is. Whatever workers become owners is usually through a lucky windfall, e.g. finding a niche, being a market first-comer, marrying to a person who is an "owner", etc.

It doesn't scale, so any tales of mass upward mobility are usually exaggerated and not applicable in practice.

However, none of these are an excuse to stop doing anything. You can still play by the capitalist game and improve your station, even without becoming an owner. That still requires some luck (e.g. having a decent childhood and education), but it is at least attainable.


Marx himself participated in the stock market


I see that my post might come off as complaining, but I asure you it's not the case. I do "hustle" as you call it, and that's why I wanted to know other opinions on this.

And I'm not coming at this from a class based marxist ideology. I'm asking for equal pay for equal work, which isn't a radical idea.

Also, though I do work in a software company, I am not a developer or deal with serious tech in anyway.


You need to ask yourself why the company hired you in the first place. You might perceive yourself to be an equal, but as shitty as it is, most likely the company and your colleagues do not. They should, but they probably don't. The company looked overseas to hire you in the first place solely because you were cheap labor. If you were not willing to work for cheap, they would not have hired you at all, they would have hired a local instead or found someone else overseas who would work for much less. That's the unfortunate reality - it's not about you as an individual, it's not about what you do, it's about what you are to them - cheap labor.

Ask yourself, if the roles were reversed, why would you want to hire someone from the United States to work for your business wherever you are based? You'd probably prefer to hire locally. The only reason you'd start looking abroad is if there was some value in doing so, and that might be for cheap labor, or it might be that when selling product overseas you want a person local to that area selling to the people of that area because they might be more successful at selling than a foreigner.


Your other post said you were demoralized and “quiet quitting”, or collecting a paycheck and fucking around.

That may work for a while, but long term you will be unfulfilled and miserable. It’s time for a change


Definitely a time for change, but that doesn't invalidate my argument about equal pay


You’re downvoted but you’re right to point out that you’re considering your own best next steps but not letting your individual circumstance dictate what you advocate


Thanks for verbalizing this so well, I've been thinking the same recently and that's what's causing me to withdraw from my work.


Remember also that they prefer demoralized workers leave on their own since there's no need to provide exit compensation/benefits. Look out for employers "quiet quitting" on YOU.


Quiet firing as it is being referred to if I'm not wrong. And it is working.


> The best way for workers to beat these pay systems is to apply organized pressure collectively

Telling HN could be a first step for that.


ya it’s a place to practice maybe but limited impact to discourse chatter esp in such a hostile forum for it. what are your second/third steps


> they've told me that I can transfer if i want those pay scales but that's not a possibility for me

So basically you want to be paid more than anyone else in your location? Hard to empathize with this position.




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