Any company that openly advertises remote work as a benefit is going to discount your salary.
Imagine delivering a million dollar feature, working nights and weekends, but somehow it's discounted because of where you live?
Across the river from where I live the cost of living is 5% lower - if I happen to work from there, are the features I'm delivering magically worth 5% less?
According to companies like Buffer, Gitlab, Stichfix, the answer is yes.
Push back on these salary discounts and double down on the value you provide.
P.S. The are more remote opportunities out there than you realize. If there's a job that's a good fit for you, regardless of city, find the CTO or VP of Engineering on Linkedin, find their email on Hunter.io and directly ask if remote is a possibility. Sometimes they will say YES even though it wasn't openly advertised.
It's basic supply and demand: if hiring remote, you're drawing from a larger talent pool, and therefore increasing supply.
In theory, this works the other direction (remote workers have access to more employers), but the reality is that the supply/demand ratio for devs is radically distorted in the Bay Area (and other tech hubs relative to the rest of the US, and the US relative to worldwide), so it isn't symmetric.
To flip it around: if I'm purchasing labor, why should I pay a 200% premium because the employee is located in SF rather than Nebraska?
If you're trying to hire top talent, one has to consider SF salaries (offset by high cost of living) as BATNA. But if you find someone willing to do the job at lower cost (factoring in lower cost of living, and location/schedule flexibility as a form of compensation), what's the problem?
I've been on both sides of the hiring process and to get a solid candidate into advanced stages of the interview process isn't trivial. Time is always an issue - time to screen resumes, engineering time for phone screens, for online interviews, engineering time for onsite interviews all the while continuing to release new features.
While the pool of candidates is virtually infinite, time isn't.
And so for a solid engineering candidate, that works to your advantage. So yes, push back on discounted salary requirements.
Or reach a middle-ground - offer a short term contract up front to ensure "you're a good fit for each other" and so that you can properly demonstrate your skillet. And then kill every task you're assigned.
Coming from a relatively cheap country... It does work the other direction. That's why dev salaries across the world are much more similar than in other sectors.
Scarcity (and resulting wages increase) wouldn't be as big if there were no foreign companies coming in. Either hiring fully remotely or opening up dev offices.
Purely local scarcity would have had similar effect but I believe it'd be much much much slower and with lower ceiling. Local companies paying 2x average wage seemed fine. You're making good money compared to your neighbours and feels sort of wrong to ask for more than your boss makes. Then foreign money come in and pay 4x average wage light it was nothing. Suddenly all the social stigma is removed.
That's literally what happened when a major bank's back-office was opened. They were willing to pay 1.5x-2x local market salaries and hire lots of people (compared to market size). Pretty much everybody in the industry had to follow, raising salaries effectively overnight.
"Any company that openly advertises remote work as a benefit is going to discount your salary."
I have been working and hiring remotely for years, and that is generally false.
First, if I have a perk, I will list it. It is a competitive market for talent. This is just another tool at my disposal. Would you say that about "unlimited time off" or "generous benefits" being advertised in job posting? The same pool of money pays salaries as team outings and office beer taps, catered lunches, and other perks. On a basic level everything is zero sum.
Second, as for your "across the river" example, to the extent that actually happens, that view is a bit SV-centric. For talent that wants to avoid overpriced homes and soul destroying commutes, their frame of reference is local salaries that are guided by local costs of living. As a prospective remote, I don't care if you pay +20% in SFC. I am in another place, and if you can outbid my next best offer by 10% I win.
Definitely everyone should negotiate and be aware of salaries in NYC, SFC, Seattle, and DC.
A bit of a tangent, but I don't consider "unlimited time off" a perk, at least not automatically.
A guaranteed amount of time off means the company has to pay me for unused vacation if and when I depart. So for those of you who are offered unlimited time off, get a guaranteed and generous minimum, in writing.
After all, if it's unlimited, they shouldn't mind putting "a minimum of four weeks a year" in writing, should they? If they won't, they're probably going to shame you into working all the time and then won't pay you for the vacation you didn't take.
Where I work, we are given a generous amount of annual leave, and it's great. It ensures that you can essentially take a holiday whenever you want, and I find myself with days left towards the end of the year. The company also hardly refuses time off requests.
Compare that to the startup I used to work which had an "unlimited time off" perk, it was always a struggle to get actual time off, we were always rushing to get things done, or it was a difficult time, or another engineer was already on leave, it caused more stress than anything else.
I'm all for just giving a generous amount of annual leave, in my contract, with remaining days paid out.
I completely agree with you. It is a ploy to keep accrued vacation pay off the books and keep capital efficiency high. You obviously can't take 100% vacation time, so it's not unlimited.
It's nice not to stress about PTO balances, though.
Companies where vacation time is close to zero will also say they have "unlimited." Always ask the interviewers how much vacation time they took specifically. In my experience they'll try to tell you how "someone" took 4 months of vacation but then omit the fact that no one else has taken more than 4 days and median is 0.
> A guaranteed amount of time off means the company has to pay me for unused vacation if and when I depart.
This must be a California thing. It's not generally true in most states.
And in a lot of companies, even when they specify an amount, it is a "recommended" amount. My company, for example, says 3 weeks, and many managers follow this religiously. But when you read the actual rules, it says that 3 weeks is the guideline, and not a promise. This is also used as an argument against giving 4 weeks: "3 weeks is just a guideline. You can work out more if the manager agrees."
Yeah, and most companies only let you accrue a certain number of hours of time off, typically somewhere between 100-200 hours from what I've seen. Once you hit that limit you simply don't get any more time off. Your boss won't let you take a vacation until next month? Too bad, sucks to be you.
Thankfully the way my current company handles this is about as good as you can get - they cash out balances that are too high a couple times a year at prespecified dates.
>As a prospective remote, I don't care if you pay +20% in SFC. I am in another place, and if you can outbid my next best offer by 10% I win.
No you don't win. If you leave 100K on table, you lose.
I don't want "a good salary for my area". If I'm entrusted to deliver a million dollar feature for a Bay Area company, I want the max payout for that responsibility regardless of whether I delivered it from Iowa or Vietnam.
I want to have options for my family, for myself. We want to travel the world, own a home in a great neighborhood with great schools, have experiences that few others get. And you don't get those options in life with being content with "a good salary for my area" and then denying yourself coffee from Starbucks because you're still living on a budget.
Well, I started out by agreeing with you. For lots of reasons I won't go into, local cost of living adjustments are a bad idea and employee comp should be as flat as possible. International complications can make that tough but I'm ignoring that.
But in a very fundamental way, I disagree with you. The reality is that you as a job-seeker have options and constraints when you are looking for a job. If a company isn't willing to pay you what you'd get if you were in Boston, but you aren't willing to move, then you have an impasse. If another company is will to pay that, then you take that offer. You have a set of offers and you take the best one available - not one that measures up to a hypothetical ideal.
You may want things, but that is totally immaterial to an employer. It depends on how valuable your skills are and how rare they are, regardless of location.
If you want to participate in profit, then you need to become capital, not labor. Labor sells itself in a competitive market. Prices will be determined by what other, comparable labor is offering itself for, not the value created for the company.
I'm constrained in my ability to talk about particular negotiations but, to the limited extent that HNers are taking direction from my life decisions, I'd advise you to assume that my negotiations do not frequently include "I consider myself basically a commodity fungible with a few hundred people you could source today and so I guess I'll take whatever the standard offer is."
I have followed a lot of your work. But I cant agree with all of your advice. I have been earning several 100Ks of salary since many years at FANG companies, possibly more than you. The biggest leverage for me has been from having multiple offers and performing well enough in the technical interviews to get an offer at an appropriate level. Me thinking of myself as a unicorn/laborer played no part in it. I just don't see you highlight any aspect of this in your advice.
I am familiar with patio11. I would classify the lead gen system he's set up with his website as capital, not labor.
Also, FWIW: of the vast multitude of ways in which programming creates value for companies, probably only a tiny minority of them lend themselves to the kind of contracting arrangement that he describes. All other programming gets done by labor. Which means that most programmers are labor. How you decide to describe yourself doesn't change that.
i don't have time to read this article to get to what i infer is some discussion about capital vs. labor - it hasn't shown up a few pages into the article - so i'll just reply to what you said outside of the link.
the idea that "woke labor" is non-labor is hilarious. first, this isn't possible for the vast majority of people who actually provide value to capital - you know, the people pouring coffee, or stocking shelves, etc. try being "woke" about your value at a grocery store and let me know how it goes.
second, once enough of your class is "woke" you're back at square 1, trying to beat up people below you to pander to capital. (aside: this sort of "get yours and get out" is emblematic of america generally, and not flattering imo)
that the game is stacked against those who labor is more of a pathological outcome of labor not being very powerful. this is a feature of capitalism, not a bug. it's a bandaid over cancer.
It does work that way long term. Local employers start raising salaries to outbid remote employers. Then remote employers have to raise their offers. Rinse and repeat.
Source: remote worker for over a decade residing in a relatively cheap country
Unlimited time off just means no guaranteed time off. It discounts the benefits provided because it's bullshit. All time off is at the discretion of the employer so literally it's bullshit. But figuratively or symbolically it's also bullshit. Say I want to take 5 weeks off a year. It's hardly unusual or a massive amount. I bet most companies with unlimited time off would not let me. It's a ploy to hire people who are too naive to know any better. So yeah, anyone who understands this scam would say that unlimited time off is a net negative for benefits. Absolutely.
Indeed, this has always rubbed me the wrong way. As another commenter mentioned, there are supply & demand issues at play. However, even considering that, there is still a widely held attitude amongst companies that you should feel grateful that they are "letting you" work remote, and that it is a benefit, and that remote working is something that will be offered to you in lieu of the salary you are owed.
In fact, it should be the opposite. Companies are saving money by not having to spend money on office space and overhead. Why then should I not be getting a higher salary?
> Companies are saving money by not having to spend money on office space and overhead.
Well, in a lot of cases they likely already have office space that they're already paying for for all the non-remote folks, and the increased cost of having you there too is negligible. It only becomes an opportunity for savings when they have enough remoters that they've actually foregone space -- avoided an expansion or downsized.
This sounds like the "well they've already killed the cow" argument for eating meat. Conversely, by your logic, if you're the new hire that is the one person too much for the current office and they have to move to one twice as big for twice the price, they should pay you the entire price of the office to work remotely instead.
What they do for one person doesn't matter, the point is that if everyone were remote they wouldn't need to pay for the space.
That's right, it's bimodal. Be all on-site or all-remote. Every exception incurs a cost.
The worst cases are the 90%/10% splits. I have seen the one remote join the meeting from his hot tub (fucker). I have been the one remote fighting with the VC while the rest of the team patiently humors me. The one exception drags the rest of the team down.
~40 software/dev folks. Around 18 are 'remote'. There is a primary office, and most of the 'remote' are within driving distance, and we're expected to be onsite (or available to be onsite) 1 day per week - collaboration/f2f/etc. And it works for most of those 18 - they work together on some teams, and most of their colleagues are also at the main office. My 'team' is me and another guy, but we work on independent projects, and everyone we deal with is in other states - not drivable. It's hard to get support from anyone internal - they're mostly on a couple of large teams. Even when we get together f2f, no one understands the particulars of the projects we're on, so there's not as much value as for most of the rest of the teams.
I enjoy most of the setup, but it's still a bit challenging being the 'exception' at times.
Sure push back. But I don't think these companies should be getting so much heat. A Bay Area company offering remote work to non-Bay Area employees but at a discount is doing more to increase non-Bay Area wages than a Bay Area company that won't employ non-Bay Area workers.
> According to companies like Buffer, Gitlab, Stichfix, the answer is yes.
> Push back on these salary discounts and double down on the value you provide.
Another way to deal with this is to take advantage of the arbitrage and move to higher COL cities, yourself. You will be relieved of carrying the cost, while reaping the rewards that apparently make this place worth paying so much for. Whatever that is.
Doesn’t work for everyone, but it’s far less frustrating to deal with injustice when you can take advantage of it.
If enough people do it, companies will wise up, or get outcompeted by those who do. Until then, happy arbitrage!
I consult for Bay Area startups. The perception of risk with a remote worker is still there. I battle that.
Offer up an initial short term contract to mitigate risk. Make it a liberal termination clause for both parties - if either is unhappy you just walk away.
It'll put your client/employer's mind at ease.
And it allows you to demonstrate your value without having to discount upfront.
This is how I do it as well, although I'm only mostly remote. My initial contract is usually 520 hours (3 months of full time, longer in wall-time, as I prefer to work with 2 clients at any given time) with a 10 day no-fault termination for either party. I've yet to have a client which didn't extend after the first 3 months.
This is purely a matter of negotiating power. In fact you can see with eg offshoring factories it's exactly what happens. The shoes they make aren't different, but the locals in the cheaper place cannot talk their salaries up to the western rate.
> Imagine delivering a million dollar feature, working nights and weekends, but somehow it's discounted because of where you live?
Companies pay the least they can get away with on salaries. The real question is not why they "discount" work done in less expensive areas. The question is why are they paying a premium for work done in an expensive area? At some level they must believe that programmers in expensive areas provide greater value. Either that or they are just throwing away money buy hiring programmers at a cost higher than they could get away with.
>Any company that openly advertises remote work as a benefit is going to discount your salary.
>Imagine delivering a million dollar feature, working nights and weekends, but somehow it's discounted because of where you live?
>Push back on these salary discounts and double down on the value you provide.
Companies have been outsourcing development labour across the world for quite some time now, specifically to reduce costs and amplify margins, but I haven't see many taking issue with it until it's now affecting Westerners?
If we accept that Bay Area salaries are provided in part because of Bay Area costs of living, why wouldn't it be discounted for those who aren't affected by costs of living pressure to the same extent?
If we accept that Bay Area salaries are also provided in part because of demand exceeding supply, why wouldn't the price drop when supply is increased significantly?
I understand the recent demand for remote work - offices are really becoming a toil to be in 40+ hours a week, commutes are worsening, the modern trend to discuss politics at work is ostracizing people, etc. That said, those demanding more remote availability should be aware that in doing so, in making companies more remote-friendly or remote-first, they are opening up the talent pool significantly more widely, and will be competing with people with lower costs of living who will happily accept less money for the same output.
Iterating on and improving remote collaboration processes, tools, asynchronous work, performance measurement, management and more will lead to remote being favoured as a means to reducing costs. It's simply good business. Why would a Bay Area company pay someone on the East Coast a Bay Area salary, when they could pay an excellent Polish dev dramatically less for the same work?
I'm all for remote personally. I adore the idea of being free to not live in a metropolis, to work on somewhat my own schedule, have more time for my friends and family, etc. but I'm not going to delude myself that a dramatic increase in work that offers this will not be met with downward pressure on financial remuneration for that work.
Whether that's a trade-off one is personally happy to make is up to the individual. Or, if one wants to "have ones cake and eat it too", to to speak, they could attempt to unionize across the new geographically displaced market - counties, states, countries, etc. - for collective bargaining to protect said salaries. All the best to whoever attempts that endeavour.
OTOH this acts as a market valuation of the increased value that that location's workers provide. Of course, if down the road the worker doesn't prove to hold up to this standard, i see a massive wave of SF remote workers being fired (there is plenty of remote talent online). I don't see job hubs like SF surviving a tech world where > 50% of jobs are remote.
It also acts as an indirect measure of the value dumped from VCs to landlords.
> Imagine delivering a million dollar feature, working nights and weekends, but somehow it's discounted because of where you live?
Imagine delivering that feature and expecting to get a larger salary because of where you live? COL is either a thing or it isn't. Job markets are localized because of physical presence. Once you take that limitation away, the artificial inflation of Bay area salaries fades a bit.
totally false; I run a fully remote company with ~20 employees and we pay our devs more than what they would make at a comparable office job. That being said (this is going to sound bad), the lack of a personal relationship off the top allows us to fire quickly. So we tend to pay more for but only hold on to very competent devs.
All desirable properties of a job are either going to come at the cost of fewer desirable properties elsewhere (including lower salary) or at the cost of making the job more desirable and harder to get (both because more people are applying, and because people are slower to leave the job if they like it).
Generally it's harder to effectively manage a remote team than a colocated one. Most employers, if there were the same pool of talent, available at the same price locally as remotely, would choose to to have a local team.
In order for remote to be attractive to employers, remote employees simply have to charge less than the local alternative.
Yes, ultimately you're paid for the value you provide. If you want to work from the beach in Thailand from your laptop, fine, but I'm not going to pay as much, because I have to deal with you not being available on the same schedule as me, that you have a crappy internet connection that makes video calls more difficult, that it's harder to pay you, and that it costs more to fly you to the office periodically.
Obviously remote vs local is different. But Thailand vs Paris, for a company that is based in San Diego, is not that different - both are remote. So why would you pay differently?
Anyone can pay as much/little as they want, and get paid as much/little as they are willing to accept, obviously. But IMO it is worth remembering that ultimately what matters is the value added. If you live in a cheap location, negotiate hard, because you're adding as much value as someone that lives in an expensive location.
It comes down to who wants it more. If you have some kind of rare special experience that would be hard for them to find locally, then your location doesn't matter because they will be happy to have you on board. If you are replaceable then expect to be paid accordingly.
> Any company that openly advertises remote work as a benefit is going to discount your salary.
Even if that was true, the employee is saving on fuel, time wasted sitting in traffic, vehicle wear and tear, the dangers and liabilities involved with driving, etc.
And incurring the cost of needing space at home to work, appropriate equipment, more utility usage (internet, electricity, heating), reduced potential for socializing and exercising. Assuming that "remote" == "at home", which it might not.
> And incurring the cost of needing space at home to work
It depends. As a software engineer, all I need is my kitchen table, or the couch, or the cafe down the street.
> more utility usage (internet, electricity, heating)
Totally worth it for thermostat control and to not freeze my ass off in November.
> reduced potential for socializing
If you're dependent on work for socializing, well, that's rather sad. I get that because I used to be that way until I realized that 99% of coworkers go along to get along and aren't good friends. They're out of your life as soon as they change jobs. But with extra time from not commuting, it becomes easier to find real friends IRL outside of work.
> and exercising
Uh, did you mean to type that? Because there can only be more time and opportunities to exercise when working remote.
> reduced potential for socializing and exercising
This is partially balanced by not having to commute. The time your colleagues spend in a car every day, you can spend exercising or with your friends. Also, you could set up a timer, and take each hour a 5-minute break to exercise, while your colleagues at work are taking breaks to smoke or drink coffee.
I know a guy who works from home, and he codes while walking on a treadmill. Has more exercise during his 8 hours of coding than many employed people get during their entire day.
Reduced potential for socializing and exercising? I think you mean increased. I have way more time for those things working remotely than I've ever had in my life and it's improved my quality of life immeasurably because of it. It's one of the reasons I'd never go back given a choice. Also, the employer should provide all equipment (mine does) and ideally, even internet subsidies, etc.
- Any company that openly advertises remote work as a benefit is going to discount your salary.
?? Not sure what you're talking about. My company has a flat structure and you're free to live wherever ( within the US, for now). We're remote by default as well, meaning there's no office.
But sure, if people try to pay you less work that out with them. Don't get angry about nothing though.
> Imagine delivering a million dollar feature, working nights and weekends, but somehow it's discounted because of where you live?
There is a flaw in going down this path of logic.
For a number of years after I started working, I tried to make sense of two things?
1. How is the value of what I provide to my employer correlated with my salary?
2. What exactly am I getting paid for? Presumably if I do this better/more I can get paid even more (e.g. working hard? delivering something? You can come up with many ideas here).
And the more I observed, the more I realized something:
In a decently sized company, it is very hard to figure out how much value (in $) your work contributes to the company's revenue. There are always exceptions (e.g. sales, etc). But generally your work is so intertwined with others that it's a lost cause trying to figure this out. You could do everything perfect and some other department down the road completely screws up thus negating all your contributions (not unusual).[1]
Because of this, almost no employer tries to determine your value to the company. They may have vague ideas that you're a critical employee, etc and give you nice bonuses/salary increases, but they're not going to even try to see if someone in another unrelated department's contributions are more or less than yours, and adjust salaries because of it.
So the answers to my questions above:
1. Fairly uncorrelated. A lot closer to 0 than to 1.
2. No one knows what you're getting paid for. Almost every company/boss will list some items, but they are either lying or deluding themselves: No matter what they tell you, you'll find no shortage of counterexamples in the company that proves them wrong. They say role X pays more because it deals with more complexity than your job? Likely it won't be hard for you to find jobs in the company with less complexity than your role (or role X) that pays more. Person is paid more because he puts in nights and weekends? Same thing - easy to find someone who puts in less and gets paid more. Role X gets paid more because it requires specialized knowledge and an advanced degree? Trivial to find counterexamples. Role X is critical for the company and if the person screws up it would be very expensive? To be frank, in every case of this being invoked I've noticed that people fulfilling role X get paid less. I happily moved from a role where my screwup would be very expensive to one where it wasn't, had fewer hours, a heck of a lot less complexity involved, and required almost no specialized knowledge, and quickly got a promotion with higher pay that way.
Because of all this, the reality of salaries are simple: They'll just invoke the market. It doesn't matter whether you made the company a million dollars or something close to your salary. If you happen to have special skills that are hard to find and that are in demand, that's your bargaining advantage.
There is almost no reason for a company not to save the effort and just go with the market. To the point that it's not even immoral to behave this way unless taken to some extreme.
Getting back to:
> Imagine delivering a million dollar feature
You'll almost never show that you did this. And if you did, you'll rarely be able to show that they needed you to do this vs the guy who'll take 10% less pay.
If you want higher pay, don't appeal to moral/ethical arguments - they will simply demonstrate your admission of a disadvantage. Instead, demonstrate you have skills they need that they won't find easily. Until you can find a way to differentiate yourself, you are not worth more than a remote worker in a low COL area (including those in other countries).
[1] As an aside, one of the perks of having a salary is that you are immune from these events - you'll still get paid even if your contributions amounted to nothing for the company. As such, there's also a reason your salary will be lower than investors - you're not taking on the risk they are. But this is a separate topic.
Imagine delivering a million dollar feature, working nights and weekends, but somehow it's discounted because of where you live?
Across the river from where I live the cost of living is 5% lower - if I happen to work from there, are the features I'm delivering magically worth 5% less?
According to companies like Buffer, Gitlab, Stichfix, the answer is yes.
Push back on these salary discounts and double down on the value you provide.
P.S. The are more remote opportunities out there than you realize. If there's a job that's a good fit for you, regardless of city, find the CTO or VP of Engineering on Linkedin, find their email on Hunter.io and directly ask if remote is a possibility. Sometimes they will say YES even though it wasn't openly advertised.