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Google staff could face pay cuts if they work from home permanently

Google employees who choose to switch to permanent remote work could receive pay cuts depending on where they live.
Written by Owen Hughes, Senior Editor

Google employees who choose to work remotely all of the time might see pay cuts as a result, based on where they are located.

Typically, Google employees have been compensated according to where the office they work out of is based. For instance, an employee who works from Google's New York office would be paid the same as someone who commuted into New York every day from outside the city.

But Google workers who choose to work from home permanently could see reductions in their pay if they live in less expensive areas than those where the company's offices are located.

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Google has introduced a new Work Location Tool that shows employees the salary adjustments they can expect to receive if they decide to relocate or request fully remote work.

Reuters reports that an employee living in Stamford would be paid 15% less if they chose to work from home rather than make the one-hour train commute into New York City each day.

However, an employee living in New York who chooses to work from home indefinitely won't see any salary adjustments compared to an employee living in the same city who chooses to go into the Google offices.

Google noted that salary adjustments were typical for employees who decided to relocate, depending on where they relocate to.

A company spokesperson said: "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. Our new Work Location Tool was developed to help employees make informed decisions about which city or state they work from and any impact on compensation if they choose to relocate or work remotely." 

Google is one of many Silicon Valley firms to have introduced remote- and hybrid-working options for employees off the back of the coronavirus pandemic.

Earlier in August, the company delivered the first round of work location application responses to employees who have requested fully remote work, or who wish to transfer to another office.

According to Google, some 100,000 employees have applied so far, of which 85% have had their request for location transfer or remote work approved.

The option of allowing employees to work remotely has ignited debate about what this means for compensation. Some have argued that employees who chose to relocate to cheaper towns and cities, or eschew the daily commute, should either pay more tax for the privilege of doing so or have their salary adjusted accordingly.

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Others have argued that working from home ultimately means employees are spending more on heating, food and equipment that would typically be provided by default by working in an office and, therefore, should have these expenses covered by their employer.

There's also the issue of the need for adequate spaces for working from home – if anything, the pandemic has highlighted just how few office workers benefit from a dedicated space from which they can work from home productively. Some researchers have argued that the burden of paying for office space moves from the employers to the workers when they are remote, meaning businesses should foot the bill for the extra housing costs of switching to remote work.

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