I would still encourage this company to not take location into account for salaries. Why should the company take the benefit from your choice(or lack of) to live in a cheaper place? You live there, you took the risks and the tradeoffs, but the company is taking the benefit from it... Some companies pay 3-10 times lower salaries and even if they give you stock options you can't afford to buy the shares when the time comes. This is not the case here, but it may become an issue in the future.