If the COVID-19 pandemic has taught us anything, it’s that many of today’s professionals can do just fine working from home. At first the idea that employees wouldn’t be coming into a centralized location caused many employers to shudder in dread. But one day people who had been working in their offices suddenly were connecting their laptops from home, instant messaging colleagues and conducting business. And guess what – the sky didn’t fall! The question for employees and employers is how should remote employee salaries be set.
How Employers are Adjusting to a Remote Workforce
While doing the actual work has not suffered, how remote workers are paid is undergoing an evolution.
The remote work revolution has made it possible for more workers to reconsider where they want to live — for example giving up expensive cities for more affordable ones. Many employers have embraced the idea of working from anywhere, but some — including big names in tech like Google, Facebook, and Microsoft — have indicated a move could come with lower pay.
Such policies are common among large national corporations – and where the work is done often dictates salary.
But this new norm questions some old policies. For example, an employee’s location determines their cost-of-living and that, in turn, helps calculate their salary. So, it begs the question: should remote employee salaries be locally adjusted based on their varying regional expenses?
Some companies are agreeing to let employees work from anywhere for the same pay, but other companies – particularly those that have adopted a hybrid model (where employees work partly in the physical workplace, and partly remotely) – are setting remote employee salaries based on pay in the locations where employees actually live.
Salary Negotiation in a Remote World
The fact is a pay cut isn’t a given—but potential workers looking to take the remote leap should research the pay scales in the market where they want to live and be prepared to make a compelling case for how remote employee salaries should be calculated. Having this type of info can be found on sites such as Payscale.com and Glassdoor.com.
In the case of a fully remote company, salaries could be pegged to the region the organization calls its headquarters or where the remote worker is based, or some combination of the two.
Candidates who want to work remotely or have a certain hybrid schedule need to be upfront about what makes them attractive as a remote employee and the exact type of work arrangement and pay they are looking for.
Job hunters should also review the expenses associated with going into an office. Working from home could save enough that a perceived pay cut would not be a factor. Many remote workers report significant savings on expenses such as commuting, dry cleaning, clothing purchases and buying lunch. Factor in the personal time saved by no longer commuting into an office and what might appear to be a drop in pay is actually not.
For jobseekers looking for remote opportunities, it’s important to have an honest conversation with a trusted recruiter or with the hiring manager – because after all, you won’t know what’s possible if you don’t ask.