If a company hires someone in Tulsa and then they move to San Francisco will the company pay more?

The end goal of location based compensation seems to be encouraging everyone to live in a low cost area, and take a lower wage thereby saving the company money.

I can see why it makes sense to the company, but as an employee I wouldn't support the idea.

We may not have a software union, but the least we can do is be critical of ideas that will directly lead to paycuts.