# How to calculate fair pay in local currency based on salary range in dollars?

Suppose Bob applies for a remote position (so no visa or even travel involved) on a company based in the United States and his research indicates that the average salary for the position is \$s (\$ = USD dollars) per year.

Bob will be paid in his local fictitious currency φ, and \$1 is worth φ10.

Something tells me it would be naive to assume Bob should simply ask for φ10*s, as cost of living in his country might be lower than in the United States. On the other hand, it would be too cheap for the company to pay him φ2*s, right?

How can Bob assess his worth in his local currency? Are there other factors that weight in to reach a reasonable value?

• Yes, if Bob needs an H1B visa, that considerably lowers his market value. Also, that makes it less likely that he gets promoted, because H1B workers can't switch employers as easily as local employers can (until he gets his green card). Also, framing this issue in terms of fairness sounds wrong. The market isn't about "fairness", it's about supply and demand. Commented Jul 11, 2022 at 23:41
• @JoeStrazzere Hmm, I reckoned that the company would be saving φ8*s... Of course, there may be some "leaks" on the way such as exchange fees or local taxes, but that shouldn't amount for so much. Do correct me if I'm wrong. Commented Jul 12, 2022 at 0:40
• There is a question on the Personal Finance site asking pretty much the same thing. money.stackexchange.com/questions/151649/… Commented Jul 12, 2022 at 12:54

How can Bob assess his worth in his local currency?

His worth in local currency is what someone is willing to pay him in local currency.

He could get offers from other companies. Perhaps a local company. He could look on job boards and see what comparable jobs are paying.

Or he could just take a guess and ask for whatever he thinks he can get away with. Maybe he'll get lucky. Maybe he won't. Either way he'll have more knowledge regarding what at least one company thinks he's worth.

• The salary he could get from a local company is the lower bound and the US salary would be the higher bound (assuming here that the lower bound is actually the smaller of the two). Any salary between these two bounds is a good deal for both Bob and the company (assuming Bobs work is worth as much as that of a US employee). There is no reason to claim that the absolute minimum is the only reasonable answer here. Commented Jul 13, 2022 at 10:47

The main reason people hire remote workers overseas is that they can be had cheaper. The research into salary is irrelevant unless it is done on that basis. There may be other reasons but in terms of money it makes no sense to hire someone overseas who costs as much as a local.

So as an example a well paid engineer in my country makes the equivalent of \$10,000 USD a year. US companies that hire here to look after their interests pay slightly over the going rate, but still much less than they would pay someone in the US.

• Thanks for your response. \$10,000 a year, that would be <\$1,000 per month, is that correct? Commented Jul 12, 2022 at 0:13
• Yep, much less after tax etc Commented Jul 12, 2022 at 0:15
• @LoremIpsum to get monthly salary from annual salary all you do is divide by 12, some countries work a 13th month though. Commented Jul 12, 2022 at 7:08
• " it makes no sense to hire someone overseas who costs as much as a local." The toptal company proves this is untrue. There are companies who have an international network of developers that don't charge a cent less than what it would cost an American to do the work. Commented Jul 12, 2022 at 16:54
• "The main reason people hire remote workers overseas is that they can be had cheaper." This is simply untrue. There exist a fair number of high-end freelancer companies that have a plethora of international workers who are not cheap at all. Commented Jul 12, 2022 at 16:58

You'll have to offer more than any local company or any foreign company is offering him. That's all. Plus a bit extra so he doesn't leave quickly for a better offer. And remember that as soon as you hire him he can put "worked for a US company" into his CV, which means he can demand more.