By Andrea Chang Los Angeles Times
WWR Article Summary (tl;dr) As Andrea Chang reports, "Working from home was intended to be a temporary measure for millions of workers in the early days of COVID-19. With no clear end in sight eight months later, employers are offering a perk that would have been unthinkable at the start of the year: Live and work from wherever you want — permanently."
Before the pandemic, software engineer Allen Dantes commuted four miles every day from his apartment to the headquarters of ChowNow in Los Angeles.
The online food ordering platform sent employees home in March until further notice, leaving Dantes, 27, to work from the small two-bedroom apartment he shared with his girlfriend. A few weeks ago, they moved into a 1,500-square-foot three-bedroom, two-bathroom Craftsman they bought for $415,000.
Dantes' new commute: 390 miles or zero, depending on how you look at it. The house is in Sacramento, Calif. Both have kept their jobs, even though neither of their companies has offices there.
Working from home was intended to be a temporary measure for millions of workers in the early days of COVID-19. With no clear end in sight eight months later, employers are offering a perk that would have been unthinkable at the start of the year: Live and work from wherever you want — permanently.
It is a monumental shift for corporate America, one that's forcing companies to rethink the ways they conduct business, manage employees and shape their corporate cultures. And it has major implications for workers, who are now free to untether themselves from city centers and move to places better suited for their budgets and personal situations. But there is often a catch.
Many employers are reducing pay when workers decide to move to less-expensive cities, a controversial measure that has sparked discussion about what it means to be fairly compensated. In some cases, employees have seen their salaries cut by more than 10%.
Tech companies are leading the way, reversing years of heavy investment in lavish Silicon Valley campuses designed to lure workers and keep them there well beyond the usual 9-to-5 workday. Facebook, Twitter, VMware, Stripe and ChowNow are among those that have rolled out permanent work-from-anywhere policies and salary adjustments, and are preparing for a wave of employees to distance themselves from headquarters and other main offices. In May, Mark Zuckerberg predicted up to half of Facebook's employees would work from home within five to 10 years.
"Opening offices will be our decision," Jennifer Christie, Twitter's chief human resources officer, said in a May memo, "when and if our employees come back will be theirs."
"We've told everyone: If you're not comfortable, no problem, stay put," said Rich Lang, senior vice president of human resources at VMware.
Tech companies have often been at the forefront of trailblazing workplace trends, helping popularize open-plan office layouts, standing desks and casual dress codes. But its leading companies for years resisted allowing people to work remotely, insisting that being physically in the office was key to creative collaboration.
In 2013, then-Chief Executive Marissa Mayer famously banned telecommuting at Yahoo. That same year, Patrick Pichette, who was Google's chief financial officer, said the company wanted "as few as possible" to work from home: "There is something magical about spending the time together."
Facebook, founded in 2004, resisted opening an office in nearby San Francisco until 2017, preferring to make all of its Bay Area employees commute to its campus in Menlo Park.
But when COVID-19 hit the U.S., tech companies were among the first large employers to send their workforces home. Many found the transition surprisingly smooth.
Employers say forced work-from-home helped them see that their workers could be just as productive, or even more so, outside a traditional office setting, aided by better communication tools and other technologies that have made it easier to get work done from wherever.
The benefits for workers are clear: less time stuck in traffic, more time at home, greater freedom to set and manage one's own schedule, and the possibility of relocating to a more affordable city or to be closer to extended family.
For employers, that means happier workforces, higher retention rates and reduced real estate and office expenses. But they say the greatest upside is the ability to attract new employees who live in places they would not have hired from in the past, giving them a competitive edge over rivals who insist on in-office workers.
"All of a sudden, the entire U.S. is open to us hiring people," Lang said. "It opens up a whole X factor."
Before the COVID-19 pandemic, VMware's U.S. recruiting efforts centered around its half a dozen large offices in regions such as the Bay Area; Bellevue, Wash.; and Colorado Springs, Colo. Now, the software company said it will consider applicants regardless of location.
To make things fair, existing employees can move wherever they want, an offer that the company anticipates many will take: In a survey sent to VMware's 32,000 employees, half of respondents said they would like to continue working from home long term; only 10% said they wanted to be in the office the majority of the time.
But that new freedom can come at a price. VMware is adjusting pay based on factors including the cost of labor and income tax rates in an employee's new location. Workers have access to an internal tool they can use to compare how their salaries would change.
So far, two-thirds of VMware employees who permanently relocated since the flexible-work initiative was rolled out in September saw their pay decrease, some by as much as 18%; the rest saw their pay increase, a spokeswoman said.
Companies including Reddit and Veeva Systems say they are not adjusting salaries. Reddit went a step further, saying in a blog post it is "eliminating geographic compensation zones in the U.S.," putting all employees on the same footing regardless of where they live and work. "It means that our U.S. compensation will be tied to pay ranges of high-cost areas such as SF and NY."
Others are implementing a set pay cut: At Stripe, employees receive a one-time $20,000 bonus if they relocate permanently. But the online payments company is cutting pay by a flat 10% for those who leave New York, Seattle or San Francisco (where Stripe is headquartered), regardless of where they move in the U.S. A Stripe spokesman said the bonus was to alleviate any financial concerns that workers might have about the cost of moving.
Some say any pay cuts are unfair. If companies are already saving money by not having to maintain physical offices, the thinking goes, shouldn't those savings be passed on to employees? And if an employee's work is unchanged, shouldn't they be compensated just as they were before?
"You're a beta or not valued if you take a pay cut and bow to HR or dumb corporate rules," said Adam Singer, chief marketing officer at enterprise tech firm Think3. Singer moved to Austin, Texas, in December from the Bay Area, where he had worked at Google and other tech companies for a decade.
Since then, "I've helped probably about 10 of my friends who are leaving San Francisco and New York City negotiate to not let their company adjust their pay," he said. "I understand this is a first-world problem. But the margins of these software companies are so good I think employees should stand up for themselves."
His advice: "Negotiate the delta in bonus or stock," he said. "Your manager has levers."
The topic has prompted heated debate on online tech forums.