Reddit won’t cut pay for workers who leave San Francisco, New York

Reddit this week announced a number of workforce changes in a company blog post, including

Reddit this week announced a number of workforce changes in a company blog post, including that it will allow employees to work entirely remotely and will not adjust pay if they move away from pricey cities.

The company will eliminate existing geographic compensation zones in the U.S. moving forward, meaning all compensation will be tied to the pay ranges of its San Francisco and New York City workforces, regardless of where the employee lives.

“We believe this is the right balance of flexibility and support for employees, recognizing the varied tradeoffs people consider when deciding where to live,” the blog post reads. “Internationally, we have had one pay range per country, and now the U.S. will be consistent with this approach.”

Nellie Peshkov, chief people officer of Reddit, tells CNBC Make It that prior to the pandemic, a number of employees worked remotely and were paid according to the market rate in their location. Now, these workers will see their pay adjusted to be competitive according to San Francisco and New York salaries, per the new policy.

Peshkov adds the decision makes Reddit among the first high-profile tech companies to explicitly say they will not adjust pay for workers who choose to move due to or following the pandemic. While some companies have allowed for more widespread remote work, several including Facebook and Stripe have said they would adjust pay based on workers’ new locations.

“We want to pay our employees for the impact they’re creating for Reddit,” Peshkov says. “Where they choose to live, and the cost of living there, is not a factor that we as a company will take into consideration when deciding how to pay employees.”

Reddit has more than 600 U.S.-based employees across San Francisco (where it is headquartered), New York, L.A. and Chicago. Prior to the new policy, workers across these offices were paid differently based on the cost of living in their city.

The company will retain its offices and redesign spaces to support people coming in between one and five days a week, though many will have the option to work from home entirely. Some roles that need to be performed from offices or specific geographic locations, such as facilities or IT support, will continue to work onsite.

In place of fixed desks, workspaces will have “casual and coffee shop-style seating,” private space for focused work, conference rooms, “neighborhoods” for teams to gather and bookable desks for employees working in the office.

The company hopes to accomplish three major goals through these changes: increase diversity by attracting top talent without requiring employees to relocate; drive employee engagement and productivity; and manage existing office space more efficiently.

“We’re excited to have more opportunities to find great talent wherever they live,” Peshkov says. As the company grows its distributed workforce, she adds that leaders expect to re-engineer its learning and development programs to support remote workers in their careers.

“If nothing else, this year has proven we can do it and do it really well,” Peshkov says. “Just last month all 700 employees globally gathered together for three-day summit. We interacted with each other, had fun and built trust, all in a virtual space. We know it’s not only possible, but online engagement can also be very effective.”

Reddit joins tech giants like Twitter, Square and Microsoft in allowing employees more flexibility to work from home — in some cases “forever.”

Peshkov suggests other employers continually gauge how workers are doing at home — by productivity measures but also their general wellbeing, and with consideration to how the pandemic has challenged workers’ families and communities. She recommends leaders offer flexibility and resources, like Reddit’s annual stipend of several thousand dollars for work-from-home costs, to support and engage employees through the pandemic.

“We’ll continue to keep a pulse on what’s working and allowing people to be successful, impactful and high-performing” as work arrangements shift, Peshkov says. “And if it’s not, we’re not afraid to make other changes, learn and evolve.”

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