Google has lowered salaries for new workers in some North Carolina offices, one of the areas company executives say is meant to help increase the overall diversity of the tech giant’s workforce.
Stock equity grants, which typically make up a significant portion of tech workers’ total compensation, are also being reduced starting last month. For some employees, that means their stock grants could be 25 percent lower than if they worked at other Google offices, like in Atlanta, the workers said in the letter.
The employees say they want the salary cut reversed, and a commitment from their bosses to be more transparent about how regional salary differences are determined.
“Why is this new policy being introduced after our work contributed to a record-breaking performance in the stock market, in spite of Covid-19?,” the employees wrote in the letter. Google made $257.6 billion in revenue in 2021, up 41 percent from 2020.
Google’s workforce has historically been concentrated in the San Francisco Bay area, one of the most expensive places to live in the country. But in 2020, the company said it would double down on hiring in a broader range of locations, in part to help increase the diversity of the company’s workforce.
In a 2020 blog post, Chief Executive Officer Sundar Pichai mentioned Atlanta, Chicago and Washington, D.C., as places they are hiring to help increase the number of Black employees at the company. In 2021, 4.4 percent of Google’s workforce was Black, compared to 3.7 percent the year before, according to the company’s annual diversity report.
“In our annual review, we found that our compensation guidelines in the Research Triangle region exceeded the market pay benchmarks, so we made adjustments to align with the local market. Employees working there have not seen a reduction in salary or in their existing equity grants,” said Google spokeswoman Shannon Newberry. “Our goal is to always pay at the top of the local market.”
Tech giants in recent years have sprawled across the nation in search of additional — and sometimes cheaper — talent. Amazon conducted a nationwide “HQ2” beauty search before landing on Northern Virginia. Tesla is moving its headquarters to Texas. And Google, Facebook and other giants have opened offices in major cities across the country.
Many of the companies pay different tiers based on where employees are located and the cost of living there.
The tech industry has long struggled to increase its diversity among what is a largely male, White and Asian workforce. Google in particular has had problems with its recruiting practices at historically Black colleges and universities, The Post has reported.
Last year, Kamala Subramaniam, the head of Google’s Durham office who has been tasked with expanding the company’s presence in the area, said she wanted to work more closely with HBCUs.
“Walking into the Google Durham site should be a statement in itself: it should be diverse with the historically underrepresented groups across all levels,” Subramaniam said in an interview with the Raleigh News and Observer.
Google has around 200 to 300 employees in the area, current employees said in interviews. The company has said it wants to grow its presence to over 1,000, making the region into a major engineering hub.
“It feels very problematic that the company is paying people less in this area while claiming they want to hire more people from HBCUs and other disenfranchised groups,” said one Google employee from the area, who spoke on the condition of anonymity to discuss internal matters.
That employee and another one stressed that they liked working at Google and felt the company paid them well, but they wanted to make sure the firm was treating all of its workers fairly.
“We want to see this office succeed, and we want this office to become a very diverse office. We just want it to be a successful and diverse office where people are making as much as their peers,” the employee said.
The pandemic has also spread more Google employees across the country, as people took advantage of the ability to work remotely and moved to more affordable locations. Many of the workers located in the Triangle area relocated there during the pandemic, the employees said.
The announcement that pay would be cut below national levels came after many made the move, the workers wrote in the letter to management. Some have even left the area, one of the employees said.
Google executives have said most workers will be expected to work in an office most of the week, once it is safe to do so. The company set up an internal calculator for workers who left the expensive areas of San Francisco and New York to calculate how much their pay would be cut if they did not return, Reuters reported in August.
For the workers in North Carolina, the pay cuts feel especially targeted.
“This just fits into this pattern of going to the South to try to have cheaper labor,” one worker said. “That looks pretty bad.”
Google’s spokeswoman is named Shannon Newberry. An earlier version of this article incorrectly spelled her last name. This article has been updated.