Why Silicon Valley Workers Who Move For Remote Work Face Pay Cut

Workers in Silicon Valley who choose to take advantage of remote work policies and relocate to other cities during the coronovirus epidemic may face pay cuts for their new cost-of-living expenses.

VMware Inc., a software firm based in Palo Alto, California, has begun allowing some of its employees to transition to permanent remote work. Bloomberg reported that workers, who are among the most expensive places in the country, experience significant wage adjustments to live in other less expensive cities.


In one example, a VMware worker who moves from Palo Alto to Denver reported that their salary would be reduced by 18%. VMware declined to comment on whether Bloomberg’s figures on potential salary adjustments were accurate and said the company’s current policy is to create a flexible environment for its employees.

“Through our Future Work Initiative, VMware is building a dynamic, global workforce of the future, where our people have the choice and flexibility to work from any location providing the most innovative solutions for our customers To accelerate their productivity, ”the company said in a statement on Friday. “Our program is designed to empower our employees so that they receive information to help them make decisions. VMware is dedicated to equal pay for its workforce, not only by race and gender, but the work space. Or even geography.

After the epidemic many American companies in various industries shifted to remote work, making it difficult for employees to work safely in traditional office locations. With no clear timeline for return to pre-epidemiological work conditions, some companies are allowing workers to work remotely permanently.

The anchor Security The last Change Change %
American Plan Facebook inc 266.61 -1.48 -0.55%
TWTR TWITTER Inc. 38.93 -0.02 -0.05%
VMW VMWARE 142.01 2.19 + 1.57%

Wage adjustment is common when workers move from one city to another. Two other tech companies based in Silicon Valley, Facebook and Twitter, have similar policies.

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Representatives of both companies said the policies had been in force for years and there was no response from employees who relocated during the epidemic.

A Facebook representative said in a statement, “We have always used a ‘market-based’ approach to compensation, which means that we are consistent with common market practice in each location.” “This is our current practice and has been for years. This applies to all workers, including remote workers. ”

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A Twitter representative said that wage adjustments to move workers “are not a new policy.” The company has made a number of benefits to support workers during the epidemic, including an allowance of $ 1,000 to purchase home office supplies and employee welfare programs from work, during the rest of the company’s days.

“We have always had a competitive approach to pay localization and we are supporting our employees in this challenging time,” the spokesperson said.

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