What is Location-based pay?

Location-based pay

Geo-pay

Location-based pay is the practice of setting a remote role's salary according to the cost of living where the person lives rather than the value of the work. The same function can be paid very differently to two people on the same team.

It is one of the most consequential and least discussed negotiation points. Some companies pay for the role's market and others for the person's location, and that policy is usually written before you arrive. Knowing which of the two models a company runs completely changes the argument you negotiate with.

Also called: geo-pay, geographic pay differential, location adjustment

Related terms

Total compensationTotal compensation is the complete package of an international remote role: base salary, variable pay, equity, learning and equipment budgets, time off and health cover. Comparing base salary alone across countries leads to the wrong conclusion almost every time.
Remote workRemote work is a working model in which a person performs their role from any connected location, without attending a company office. It defines neither the schedule nor the type of contract: it defines only where the work happens, which is why it coexists with both employment and contractor arrangements.