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By Danielle Kaye | Reuters
NEW YORK – Google employees based in the same office before the pandemic could see different pay changes if they switch to working from home permanently, with long commutes hit the hardest, according to a company salary calculator seen by Reuters.
This is a Silicon Valley-wide experiment that often sets trends for other large employers.
Facebook and Twitter have also slashed salaries for remote workers who move to cheaper areas, while small businesses, including Reddit and Zillow, have switched to location-independent compensation models, citing benefits in terms of hiring, retention and diversity.
Alphabet Inc’s Google sets itself apart by offering employees a calculator that allows them to see the effects of a move. But in practice, some remote workers, especially those who commute long distances, could experience pay cuts without changing addresses.
“Our compensation plans have always been determined by location, and we always pay at the top of the local market based on an employee’s workplace,” a Google spokesperson said, adding that the salary would differ from city to city and state to state.
A Google employee, who asked not to be identified for fear of reprisal, typically travels to the Seattle office from a nearby county and would likely see his pay cut by about 10% working from home full time, according to the reports. estimates from the company’s labor office. The localization tool was launched in June.
The employee was planning to work remotely but decided to continue traveling to the office, despite the two hour commute. “It’s a pay cut as high as the one I got for my last promotion. I didn’t do all that hard work to get promoted and then take a pay cut, ”they said.
Jake Rosenfeld, a sociology professor at Washington University in St. Louis who studies wage determination, said Google’s wage structure sounds the alarm bells about who will feel the impacts the hardest, including families.
“What is clear is that Google doesn’t have to do this,” Rosenfeld said. “Google paid these workers 100% of their previous salary, by definition. So it’s not as if they can’t afford to pay their employees who choose to work remotely in the same way they’re used to receiving.
Screenshots of Google’s internal salary calculator seen by Reuters show an employee living in Stamford, Connecticut – an hour from New York by train – would be paid 15% less if she worked from home, while a colleague in the same office living in New York City would see no reduction in working from home. The screenshots showed differences of 5% and 10% in the Seattle, Boston, and San Francisco areas.
Interviews with Google employees indicate pay cuts of up to 25% for remote work if they leave San Francisco for an almost as expensive part of the state as Lake Tahoe.
The calculator indicates that it uses metropolitan statistical areas from the US Census Bureau, or CBSA. Stamford, Connecticut, for example, is not part of the New York CBSA, although many people who live there work in New York.
A Google spokesperson said the company would not change an employee’s salary based on their shift from office work to being completely remote from the city where the office is located. Employees working in the New York office will be paid the same as those working remotely from another New York location, for example, according to the spokesperson.
Google did not specifically address the problem for commuters in areas such as Stamford, Connecticut.
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