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Million dollar question - how are the remote stripes going to be compensated? Are they going to be compensated pegged on their geo-locale (which then just makes it like international offices without the office)?

I'm pretty sure the dublin and singapore stripes are paid much lower than their sf counterparts. How are they going to resolve this for the remotes?

Not poking at stripe, but generally as I think of remote work, I think we're probably to going to think of true value based salary scales (you are creating X$ of value, therefore you are to be paid a fraction of that) as opposed to geo based scales (you may be an icpc world finalist living in Kathmandu but you will be paid 1/10th of a boot camper from SF because 3rd world).

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They are compensated according to locale. Our Google sheet of offer anecdata contains a few entries for Stripe, some remote and some SF. I’ve seen a salary difference of 30%. I don’t know the people who entered them personally so I can’t speak to how well they performed during the interview, so take that with a grain of salt.

I just don't understand this.

If a company knows how to get choose a USD200k engineer in SF and get a good return for the company off that engineer, then why wouldn't you pay USD200k in all areas?

USD200k is a good carrot where I live, so you would be able to attract the best engineers living here (with far less competition and far less churn).

I get it that SF has network effects, but good remote engineers also tap into the same network.

> then why wouldn't you pay USD200k in all areas?

Because they don't have to. Peoples' expectations of salary are likely in line with their local job markets, so even great developers living in a rural area will likely either accept the average base salary for their locale, or move to SF for the larger payday (and all of the expenses that come with it).

This should be reversing because the internet grants us easy access to this data, so market signals should be forming, but it isn't reversing, which is suspicious. Getting the data is harder, but we do already have data sets to compare to (and can apply inflation, CoL, other adjustments as time goes on).

The only real reason for zip-code adjustments would be some labor-related, CONUS, or state laws that I'd be unfamiliar with.

If I deliver the same business value as a Silicon Valley engineer, and you're paying me less, I'm getting arbitrage'd.

I agree, if we're getting paid differently based on zip code but producing the same business value we're getting arbitrage'd. The question is; how do we as developers make money off this market inefficiency?

We have a few options. 1. Negotiate better salaries. This is only possible when the purchasing price of the next best developer also increases. This already happens in the Bay area market. It is happening slower outside the Bay. 2. Start own our business. We hire the best developers at a higher rate which raises the market rate for a developer. This is happening in the Bay but much more slowly outside. 3. Move to a better geographic market. A lot of people who can chose this.

Developers probably can't exploit/correct this market because we have no way of directly/quickly making profit from the price difference.

I would love for developers to capture a larger share of the value they create. Does anyone have any ideas on how to restructure the incentives of the market to make this happen? (Cooperatives?)

In that case what if I use the zip code for getting a better salary and then just move a cheaper location?

Depends on the company. At my previous one you were locked in to where you started so I left after moving to a more expensive city and they refused to adjust it.

There are a lot of bad managers who style themselves as feudal lords and one of the known ways to get them to give up on that model is offering to save them a bunch of money. Pay someone a bunch of money and I don’t get to yell at them? No thanks.

Also if the hire is living on a ranch in Montana then at least as of today they don't have that many companies to choose from if they turn you down for a lower salary than Bay Area engineers get. In SF they can just walk down the street to the next place but there aren't that many really remote companies out there.

I mean companies that you don't transition to remote but start off as remote and are treated as a first-class employee the whole time and that the workflows are remote-friendly.

In addition to what kossae said, overpaying for the market is not good for Stripe. The flip side of massively reducing churn is that it also means people wont leave even when they want to, because of the golden handcuffs. Stripe doesn't want demotivated employees who are only staying because they'll have to take a 50k pay cut to work anywhere else.

> If a company knows how to get choose a USD200k engineer in SF and get a good return for the company off that engineer, then why wouldn't you pay USD200k in all areas?

If you're willing to buy a $2 million property in Palo Alto, would you pay $2 million for the exact same property in West Mississippi?

To a company an employee is a commodity investment only - no matter what the culture manifesto says. There are a lot of factors that determine who gets paid what.

Would you pay for any services in your locale at San Francisco rates?

People don't get paid more in San Francisco because they deliver more value than a worker in New York City or London. San Francisco rates are high because of geographic scarcity of talent in that location. Over the long term remote is going to reduce SFBA rates, not propagate them.

> If a company knows how to get choose a USD200k engineer in SF and get a good return for the company off that engineer, then why wouldn't you pay USD200k in all areas?

If they can get those other people to join paying 100k, why wouldn't they want to save 100k per engineer?

Companies pay you what they need to in order to get you to join and unfortunately, market rates are still largely decided by location.

I know, why wouldn't a company pay more. When I go buy something, I always insist on paying double for it. It just makes sense to pay more when you don't have to.

A salary difference of only 30% relative to SF? That's going to be above market in most other places, and miles above market in many.

Walmart Labs hires for my skillset pretty often. When they first started they hired remote at Silicon Valley salaries. They've now moved to a scale based on zip code. I'll always regret not jumping on that job before they made that switch.

What's wrong with targeting equal disposable incomes (after covering essentials like housing/schools/childcare etc)?

I see this in my field where I work remote and most people in my field work in NYC or London. My gross income is way lower than my former classmates who settled in NYC. However I have a bigger house, equally good school and childcare for 1/10th the annual cost etc. Don't see why I should get a salary that reflects the massively inflated cost of living in a city that I don't live in. Instead I think it should be about targeting a quality of life commensurate with the contribution made & scarceness of the skillset. The cost of providing that quality of life will vary dramatically between someone living in a rural area vs San Francisco and so should the pay imo.

Salary scales are based on equilibrium between several forces:

1) Value that employee brings to the company

2) Value that company brings to the employee (mostly, but not exclusively, salary)

3) Alternatives available for both the company and employee

I don't see a good reason to expect this (admittedly simplified) model to change with remote work arrangement.

3) is pretty drastically different in a remote environment

Yes, of course. I wanted to emphasize that the underlying forces are the same even if the results end up different.

That's why Bay Area companies don't usually offer Bay Area salaries for remote workers around the world. And also why Croatian companies don't hire remote workers in San Francisco :)

"Having to live in the bay area" could be seen as negative value that the company was formerly "providing".

Is it equivalent to a 30% pay cut? Probably not. Is it worth at least 15k a year (post tax, so more like 20k minimum) at the absolute minimum? Yes.

Median US 1 bedroom rent: $1,209 / mo [1]

Median SF 1 bedroom rent: $3,690 / mo [2]

That's a difference of $29,772 / yr. Post-tax.

[1]: https://www.businessinsider.com/rental-prices-are-soaring-ar...

[2]: https://sanfrancisco.cbslocal.com/2019/03/05/median-1-bedroo...

Why is this even a question? If remote workers don't like the comp/pay being offered, they could go looking at other companies in their market (or other remote work opportunities). This is a non-issue.

What do you mean “why is this even a question?”? It’s a question that frequently comes up in remote worn discussions. Stripe being a big company, and now making a big commitment to remote work, is likely to be an example other companies draw from.

Can you name a single company that pays Remote Employees SF/Bay Area salaries?

Edit: Fair enough. There are companies that pay everyone SF level salaries but you can also find companies like Gitlab - 100% Remote but they explicitly downscale from SF salaries based on location.

https://about.gitlab.com/handbook/people-operations/global-c...

BaseCamp. https://github.com/basecamp/handbook/blob/master/making-a-ca...

Do you see any reported salaries? The numbers on Glassdoor for Basecamp are quite low when they claim top 10%.

Here’s their announcement about it that explains their methodology and that they started in 2018. https://m.signalvnoise.com/basecamp-doesnt-employ-anyone-in-...

Elastic https://elastic.co

Some stats:

  - Not just "Remote but in the US"
  - 1,000+ employees
  - 40+ countries
  - Local holidays
  - Co-working Space stipend, if you want it
  - Almost nobody goes to the offices we do have
  - Everything is written down and x/referenced: GH, email, Slack
  - Zoom for face to face
  - Engineering All Hands: Usually twice a year, once EU, once US
  - You work on your own Timezone, expecting otherwise is ridiculous

Source: I work for Elastic

So they pay everyone at San Francisco rates?

Sure -- an other example of a company that does salary-by-location is Buffer, which posts its salary calculator online: https://buffer.com/salary/senior-data-scientist-2/average/

My point wasn't to say that Stripe should do one thing or the other regarding location-adjusted alaries. I was asking the previous commenter why he indignant that the question be asked of Stripe at all, as if it were irrelevant.

Mozilla reduces salaries outside of SF/Bay and NYC, but from what I've seen it's not a major difference.

ime Salesforce adjusts by locale, but not significantly so

Expensify! I work as a remote engineer, but we have remote employees all over the world (Europe, Asia, North America, Australia) that don't have their salaries adjusted for COL.

I don't really want or need an SF salary, but I do expect a company to compensate fairly and not based on where I live at any given time. I can understand a reasonable adjustment based on the different compliance costs and payroll expenses for a given political jurisdiction.

What stops a person from lying (within a reasonable time difference) about where they live?

Ethics? Fear of voiding the employment contract if based on false information?

I also don't think it's practical.

Here in Germany at least, the address of residency is used in so many contexts (health insurance, pension schemes, tax things etc.) that I doubt this would go unnoticed very long.

For example the city you live in determines which regional tax office handles your income tax, and I'm pretty sure it's easy to notice for a company if some of the income tax goes to an address that doesn't match the employee's city.

It's not like people always keep their residence up to date though. If you are still able to receive official correspondence at your previous address (e.g. parents' home), why would you bother changing it? Even more so across a border -- it's trivial to have multiple residences at the same time and they are not guaranteed to be unique, nor are they necessarily considered tax residences. That is, you can be tax resident in a country where you don't have permanent residence even if you have permanent residence in another country.

Their W-2.

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