Gitlab gives few reasons in their handbook [1]. The obvious one is: "If we start paying everyone the highest wage our compensation costs would increase greatly, we can hire fewer people, and we would get less results."
Because I assume they have a headquarters which would be empty. Firing high-cost of living, high expertise employees to hire new ones (might be senior level, but not well versed in the problem) does not sound wise.
[1] https://about.gitlab.com/handbook/people-operations/global-c...