When I moved from SF bay area to Austin, my employer didn't lower my salary, but for a few years my yearly increases were small compared to my performance review until my pay grade was right for my pay grade and location combination.
This was a nice way to do it because my salary has always been monotonically increasing, and I wasn't offended that my increases were small for a few years because I knew why it was happening.
This right here is the way to deal with the problem. Lowering a salary should only happen if someone is a fuckup or reduces the amount of work they have to do. Doing it over time like this is super classy.
I don't know, if the same job gets paid less in Austin then it's not really fair for someone who transfers from SF to Austin to make more than someone who was just in Austin all long. If someone moved from Austin to SF you'd just pay them less than a new hire in SF?
At Google they just openly adjust your salary if you move between cities; move from NYC to Atlanta and you'll take a bit hit, move back for the reciprocal instant raise.
This sounds great but I wonder how much of that was employer's discretion? I imagine your work was that valuable but perhaps a less productive engineer might get a different "package".
Regardless of the rational and pragmatic reasons behind salary adjustments for cost of location adjustments, a double digit X% cut would be very demotivating for most people psychologically.
People seem to be missing that this is entirely voluntary. Facebook isn't forcing people to accept a pay cut, just saying that if you choose to move then your salary will be cut.
This has been SOP at big tech companies for years. If you choose to move to a cheaper location, your salary will be adjusted to the new market rate.
I know plenty of people who have gone through this and nobody felt demotivated. They all chose to move and were well aware of the salary cut when they made that choice.
Not just big tech companies,it's SOP at most companies in pretty much all industries.
Very very few people would not be expecting a location adjustment to their salary with a major relocation. Especially when that relocation is entirely for the benefit of the employee, not the employer.
This is what everyone I know does but that's because they're all smaller companies and each individual is pretty valuable. At Facebook, each individual is just a statistic at the margin. They cease to operate as individuals and more as a market for lots of labour.
That can't be helped. If I had a 100k size org, I wouldn't hesitate to set (overall) compensation targets at regional top prices with instant adjustment.
This was a nice way to do it because my salary has always been monotonically increasing, and I wasn't offended that my increases were small for a few years because I knew why it was happening.