Google rolls out pay calculator, experiments with pay cuts for WFH employees

Google, like Facebook and LinkedIn, warns employees of around 5%-15% pay cut based on their geographical location if they choose work from home

According to the company’s new pay metrics report, Google employees may have to accept pay cuts if they continue to work from home. The newly rolled internal pay calculator explained the pay cut is according to the geographical location of the employee.

It is a widespread experiment-in-progress at Silicon Valley to set an example for other small companies.

The tech giant with 140,000 employees across the globe pay their employee as per their geographical location. According to the company report, Google pays the highest salaries in comparison with the local companies. 

Google Pay Cut Explained

According to the employee’s statement, the new payment metrics will reduce salaries between 5% and 15%. So, for employees living in San Fransico, Seattle, and Boston, their annual package will be reduced by 5% to 10% if they choose their comfortable homes over Google Manhattan office.

Similarly, Google staff who stay farther away have been warned about harsher pay cuts. Accordingly, if an employee residing in Lake Tahoe in California chooses to work from home, they will face around a 25% pay cut.

A company spokesperson told Reuters, “Our compensation packages have always been determined by location, and we always pay at the top of the local market based on where an employee works from.”

Interestingly, Google staffers at the NYC office living within the city’s five boroughs will not suffer pay cuts if they chose to work from home.

Earlier, even Morgan Stanley has backed the move. According to the analysis, workers working in the office have better chances to excel in their assigned tasks. They will also maintain a better rapport with their bosses, therefore increasing their chances of growth. Contradictorily, workers working from home can become reluctant. The corporates have said that workers who don’t commute to their office should not be paid for their transportation.

Facebook And LinkedIn Took Google Alike Steps

Around two to three months earlier, Facebook has assured that the company will take similar steps like Google for accounting and tax purposes. CEO Mark Zuckerberg has asked his employees to shift back to their homes or inform the company about their current residential details.

All of this is a part of making a detailed remote working plan for Facebook’s 50,000 employees. The company proposes to have half of its workers as work-from-home employees.

According to a News 18 report, about 45% of employees were ‘pretty confident’ that they would move to another place, with an additional 30% is doubtful to shift their base in an internal Facebook survey.

Nearly 60 percent of staffers choose to move or settle down in smaller towns or cities for a cheaper lifestyle. “When you limit hiring to people who either live in a small number of big cities or are willing to move there, that cuts out a lot of people who live in different communities, different backgrounds or may have different perspectives,” the report quoted Zuckerberg. The company has said workers can work from home at least through the end of the year.

LinkedIn, another tech giant with 16,000 workers, have sanctioned work from home request with a pay cut according to the living costs in that particular city. Owned by Microsoft, the online employee-oriented service provider has said that the firm expects workers to work from the office for at least 50% of the working period after the covid restrictions are lifted.

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