Companies can try to do that. I've worked remotely for 5 years and always inquire about compensation up front. If they try to pay local market rates, I decline to interview with them. When you're working remotely, you need to view yourself as being competitive with candidates that are local to their SF / Seattle / NY offices and demand the same compensation as a local hire. This further reduces the pool of companies willing to hire you, but if you have the time when looking for a job it is definitely possible.