Stripe is offering a $20,000 bonus to employees who move away from San Francisco, New York City or Seattle but it comes with a 10% pay reduction, spokesman Mike Manning told Forbes, making the e-commerce and mobile payment processor the latest tech company to implement pay cuts for workers who chose to relocate to less expensive cities as remote work policies are extended because of the pandemic.
Stripe cofounders and siblings John and Patrick Collison in 2018.
Stripe, which has more than 2,800 employees, has relied on remote work for years and in May announced it would hire at least 100 remote engineers, saying remote workers have helped the company stay close to customers so they can tailor Stripe’s products accordingly.
Stripe joins other technology companies that have said they’ll cut the pay of employees who move to less expensive cities, including the social media companies Facebook and Twitter and enterprise software companies VMware and ServiceNow, according to Bloomberg, which first reported the news.
Just as many white-collar Americans are reconsidering the cost of living in expensive cities if remote work policies continue, many companies are also reconsidering expensive office costs. Some companies have had market-based salary policies in place for years, meaning pay is adjusted based on the cost of living or cost of labor in the area.
The job search marketplace Hired surveyed 2,300 tech workers and found that 55% said they would not be willing to accept a reduced salary if their employer made work from home permanent. An overwhelming 90% said the same job should receive the same pay, regardless of if the person works remotely, but 40% said they support location adjustments. More than half, 53%, said they would be “likely” or “very likely” to move to a city with a lower cost of living if allowed to work from home permanently.
Stripe Workers Who Relocate Get $20,000 Bonus and a Pay Cut (Bloomberg)
Why Silicon Valley workers who relocate for remote work face pay cuts (Fox Business)
2020 State of Salaries Report: Salary benchmarks and talent preferences (Hired)