Subscriber Survey

The Logic’s subscribers don’t support pay cuts for remote employees, survey finds

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The Logic’s subscribers don’t think pay cuts are a fair price to pay for the flexibility of remote work, our latest subscriber survey has found. 

“Work is work. If you’re good at it, where you choose to live shouldn’t matter,” one subscriber wrote.

“Compensation should be a function of value created, not location,” wrote another.

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Methodology

The Logic’s subscribers were emailed a private link to an online survey on Thursday, November 26, and the survey closed Monday, November 30. Respondents’ identities were kept anonymous and duplicates were removed as needed. Subscribers were asked: “Would you consider relocating from the community in which you currently live if your current job let you work remotely permanently?” Their choices were: no, yes, maybe, I don’t know, question does not apply to me. They were also asked: “Do you expect your company to offer employees the option of permanent remote work after the pandemic?” Their choices were: no, yes, maybe, I don’t know, question does not apply to me. Finally, subscribers were asked: “Should employers be entitled to cut remote workers’ salaries if they choose to relocate to an area with a lower cost of living?” Their choices were: no, yes, maybe, I don’t know.

In a survey conducted between November 26 and 30, The Logic asked subscribers whether employers should be entitled to cut remote workers’ salaries if they choose to relocate to an area with a lower cost of living. Sixty-two per cent of subscribers who responded said employers should not be entitled to cut pay, 19 per cent said they should and 17 per cent were on the fence. Less than two per cent of respondents said they didn’t know.

In the spring, after many workplaces went remote in response to the COVID-19 pandemic, tech firms including Shopify and Waterloo, Ont.-based OpenText announced plans to make work-from-home arrangements permanent. Facebook and Twitter made it clear that employees who moved away from their headquarters in the San Francisco Bay Area to areas with lower costs of living would see their compensation adjusted accordingly. Microsoft, Slack and payment platform Stripe have since followed suit. According to a recent study by Willis Towers Watson, as many as a third of North American remote employees who move to a less expensive location could see their pay cut to offset savings.

Canadian employees who relocate could see similar pay adjustments based on cost of living and expenses. But many of The Logic’s subscribers rejected this, arguing that compensation shouldn’t be based on location or cost of living, but on performance.

“The value of the work being done doesn’t change. Why should the rate of compensation?” one subscriber wrote.

Several subscribers raised hypotheticals to argue determining salary based on individual factors like location makes for an imperfect equation.

“That’s an incredibly slippery slope. What then stops employers from paying me less because I don’t have children to support?” one subscriber wrote.

Other subscribers asked whether employers would adjust workers’ salaries if they lived in a less expensive neighbourhood or “in my parent’s basement in an expensive city.”

Several subscribers noted that companies often save money on expenses like real estate and office supplies when workers go remote, while employees end up footing more bills and clocking longer hours.

Some respondents were OK with salary cuts as long as the money employers saved was redistributed throughout the organization in an equitable way.

Many subscribers who supported compensation changes said that salary is not only a function of skills or value, but of market competitiveness, which is related to location.

“Employment markets are geographical,” one subscriber said, adding that employers might be able to find talent at a lower cost elsewhere.

“It’s a matter of supply and demand,” another said.

Several subscribers wrote that salaries already take cost of living into account. “Employers often pay more for higher-cost locations so the reverse might be reasonable,” one respondent said.

“Pay is always relative to a city,” another wrote.

One subscriber who said that they do not support pay adjustments wrote that they raised a fundamental question for employers about how compensation was calculated: whether they valued employees based on their skills, or the cost of acquiring talent in a specific location. They said that firms should only be entitled to adjust salaries if they were able to show that cutting pay was actually “removing the premium” paid to live in a given area.

“My biggest worry is [employers exploiting talent] using this as an excuse to further drive down depressed salaries,” the subscriber added.

Several subscribers wrote that current employees should not have their pay cut if they choose to relocate.

“Cut salaries, no. As for new employees, you offer the salary commensurate with their talent and experience,” one subscriber said.

The changing nature of office work is top of mind for many of The Logic’s subscribers. Almost three-quarters of survey respondents expect that their company may extend work from home policies beyond the COVID-19 pandemic. When asked if they expected their company to continue offering the option of permanent remote work, 49 per cent of subscribers responded “yes” and 23 per cent responded “maybe.” Less than 20 per cent of respondents didn’t expect to have the option to work remotely.

Many subscribers supported a hybrid model that would allow them to work remotely sometimes, but come into the office for collaborative or creative work that benefits from the “random good” generated by in-person meetings. These results are in keeping with a previous survey conducted in August, where the majority of respondents favoured a combination of remote and office work.

Subscribers also said that the option to work remotely wouldn’t only affect current employees, but also potential hires. 

“We expect to open the sourcing of talent to cities other than the one we operate in,” one said.

“Our workforce can now be global,” another wrote.

The Logic asked subscribers if they would consider relocating from the community where they currently live if their employer let them work remotely permanently. Respondents were divided over this. Thirty-four per cent said they would consider relocating, 15 per cent said they might consider it and 44 per cent said they would not. Eight per cent said the question did not apply to them, in several cases because they already worked remotely. (“I already live in Niagara. My family was 10+ years ahead of the curve,” one wrote.)

Subscribers who said they would or might consider locating mentioned the draw of living outside the city where their paycheques might go further. 

“I don’t see the point of sticking to urban centres that are so overpriced and that really don’t fit the kind of life I want,” one subscriber said.

“Definitely thinking about moving out of the city, as long as internet connectivity was decent,” another said.

But many subscribers wrote that work is not the only tie to the place where they live.

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“My job already does let me work remotely permanently, and my wife could work anywhere. We choose to stay in Toronto because it’s great,” one wrote.

“We picked this community for a lot of really good reasons. Chose to work here, not the other way around,” another said.