Millions of workers at Google appear to be ready and willing to accept a pay drop to continue working remotely. Sixty-one percent of American workers; four out of ten Londoners; and more than a quarter of UK office workers. Breathless media headlines on the trend cite a plethora of figures, yet few people have cheerfully reduced their monthly household expenditures. In fact, when it comes to the major technology businesses implementing these remote pay cutbacks, many employees opt to cut and run.
“I’m job hunting,” says “Mike,” a senior software engineer for Google in the northeastern US who moved to a new home during the pandemic. He wants to keep working for the company remotely, but the pay drop he’d have to take is comparable to losing four years of raises. “Any pay cut is unacceptable, and it’s been presented as a ‘take it or leave it’ proposition,” he says. “Google is telling us to vote with our feet if we don’t like the situation. I love the work we do, but that’s a lousy bargain.”
Mike hasn’t decided what he’ll do yet; the Delta variation has delayed Google’s return-to-work plans, giving him more time to think over his alternatives. However, he claims that his colleagues who have sought to remain entirely remote already have their pay lowered, even though the entire firm is still working remotely.
“I’m waiting to see if they back down,” Mike says, explaining that in the past, Google had backtracked on pay-related decisions, specifically when it was announced that bonuses would be linked to the success of Google+. “That was deeply unpopular, and after an uproar among the employees, they walked it back,” he says. In this situation, he concedes, it’s harder to predict what will happen.
Laura de Vesine, a former Google engineer, did not waste any time in finding out. She left Google earlier this year after learning that her compensation would be cut by 25%. “There was a discussion about moving our team to North Carolina, and that was originally floated as a 15 percent pay cut,” she says. At first, she thought that was reasonable; then they announced it would actually be 25. “The bait and switch were very upsetting,” she says. “And once I was angry about it, I started questioning why there was even a 15 percent cut. What is it about my work that is somehow less valuable in a different location?”
That is the most common gripe among employees facing salary cuts: “How is this fair?” Remote jobs can mean living in a lower-cost location and not commuting. Still, it can also mean higher household costs, especially if you need high-speed internet in a rural area. According to a Google representative, the firm has always paid employees based on their region at competitive rates with the top of the local market. However, precedent does little to alleviate the pain that its employees are experiencing as their earnings are reduced. “They’re basically saying we are going to get the same value from you, but we think we can talk you into taking less money,” de Vesine says. And this, many feels, is not fair.”
People are agitated about the topic of fairness. Employees will respond negatively if they believe they are being treated unfairly. Emory University primatologists Sarah Brosnan and Frans de Waal are experimenting. Two capuchin monkeys are working together to complete the same activity for the same reward—a piece of cucumber. However, after a while, one of the monkeys is offered a better grape instead. The second monkey observes and reaches for hers, but when she is given another slice of cucumber, she goes mad, throws the cucumber out of the cage, and refuses to continue working.
The tantrum is similar when a toddler is handed half a cookie after watching their brother get a whole one. And no matter how old we become, we can’t stop our brains from responding when we believe we’ve been wronged. However, rather than throwing a tantrum, we retaliate in various ways.
At work, that can mean quitting. De Vesine isn’t the only one to have done so. “Google continues to assert that it is normal attrition, and I think you can make the numbers tell both stories,” she says. “But it seemed to be higher than usual and much more senior-oriented than I had previously seen when I was leaving, and I’ve seen a continuation of that.”
Even if people don’t quit, they can revolt in different ways. “If you feel like you’re being treated poorly by your employer, it’s just human nature not to work as hard,” says Brian Kropp, chief of HR research at consultancy Gartner. There’s a mindset shift, he explains. If people feel they’re not being paid fairly for their contributions, then why should they contribute more, or even at all? “Perhaps even worse than leaving,” he says, “they quit in place.”
According to a study conducted by Columbia University researchers, employees dropped their performance at work by 52% when they discovered that their peers were paid more. They were also 13.5 percentage points less likely to show up altogether. Even if employees are forced to accept pay cutbacks, they are likely to respond by working half as hard.
The worst part of the fallout is arguably what it says about the companies implementing these pay cuts. Kendra, a technical writer at Google’s Seattle campus, has seen firsthand how employee attitudes toward the company have changed. “I’ve talked to several different people who have just straight up left the company because they don’t see the opportunity for growth within our organization,” she says.
Kendra has decided to return to the office rather than taking a pay cut equivalent to losing a recent pay bump that’s taken her years to get. “But I also have a manager who is incredibly flexible,” she says. Her manager has already told her that she won’t need to come into the office the full three days a week. But what if that hadn’t been an option? “I think it would have put a deadline on my participation,” she says. Simply put, she would have quit within a year.
Other tech companies, such as Reddit and Zillow, are taking the opposite stance, emphasizing the importance of such standards. Reddit abolished its long-standing “geographic compensation zones” in October 2020, presenting itself as the type of forward-thinking corporation that Google once was. Meanwhile, Google, Facebook, Microsoft, and other companies have changed their strategy to compete with JP Morgan. “I’ve been requested to check multiple résumés, and I’ve had career conversations with folks about where they may relocate,” Kendra adds. “The rest of the industry is transforming, and Google is falling behind.”