The only way I see this as a possibility is if the company was covering his commute because they were in a hard to reach location, and now there not because he moved closer. It's not normal that's for sure.
But there are some places that can only be reached by plane or ferry, and I could see those places "compensating" for having to travel, by counting the travel time as "work time" in order to bring in new talent. Again it sounds odd though. We are definitely missing part of the story.
I know someone who negotiated the same but in the opposite direction: his employer was moving to another city and his commute time doubled. He negotiated that he would leave and return to his home at the same time as before, effectively working less hours. But he had a strong negotiating position and found this more important than a pay rise (which it effectively was, of course).
Discussion on question by Magisch: Re…
Discussion on question by Magisch: Re…