Which is correct, but it’s slimy if the company says you only need this much based off of the CoL where you are at, rather than paying the employees what they are worth.
It’s company policy so they can do whatever they want at the end of the day.
I cant speak for all companies, but i know my company, and the government (to a degree) operate this way. They determine the value of a Job. For giggles, let's just say Business Analyst. A business analyst should Make X. They then say "we want this job to be located in City A. City A has a CoL approximately Y% higher than the national average, so we multiply X * 1.y% and were going to offer the job at this rate. Your statement assumes the full salary of which you are making is purely for the job itself, when that isntt he case. Most employers value your Job at a lower rate, then give you an increased salary base don where you live. So If i went from making 100,000 to 90,000 because i lived in Los Angeles but moved down to Temecula, my 'position' isnt worth less, its just that the market for my job in the new area bears a lower salary, that's all. They could likely find someone who could do my job at a similar level or better for less in that area (obviously not talking about me here, because such a person does not exist).
I agree it 'looks' kinda shady, and its not a move im wildly applauding, but in the grand scheme of things, all they are doing is right-sizing what they didnt do before, essentially.