Pay! By location or By skill? I think equal work, equal pay. Pay is not just money. Profit share and stock options (or RSU).

Most of remote companies choose to pay based on local rates in order to be truly fair: Why GitLab pays local rates and Buffer.

But I think it is better to pay people for their Skills, not where they live. If you say someone live in a 50% cheaper location in terms of cost of living. But you have to live there and that’s their choice. It is about value added.

Market rate becomes higher? Adjust yearly.
People growing too fast? Promotions.

Basecamp doesn’t employ anyone in San Francisco, but now we pay everyone as though all did