Rethinking Pay and Benefits in a Hybrid Workplace | The Wall Street Journal

Many firms continue to re-evaluate and shift their compensation strategies, considering remote work. Behind this evaluation is determining whether remote workers—who moved to lower-cost areas during the pandemic—should face a salary adjustment to align with labor costs at their new location. I asked this very question to readers of this newsletter in an April 2021 poll: based on 117 responses, 42% said it would depend on the job, 37% say salary should not be adjusted, and 20% say it should. This recent Wall Street Journal article summarizes experts’ opinions on a few compensation issues that companies may need to reconsider as remote work models are increasingly adopted. Peter Cappelli, who says cutting pay for employees who relocate isn’t a good idea, raised the question: If you’re asking [employees] to do the same job that they did before, why do they become less valuable if they’re doing it from somewhere else?“ Susan Schroeder also sees issues with location-based pay: “Once you pay different salaries for the same job based on where people live, you are on a slippery slope of pay fairness, equity, and gender discrimination.” Other ideas are discussed to help firms think through the compensation implications of a “work-anywhere” model.