ISSN: 2226-6348
Open access
The future of foreign organizations’ competitiveness in the global market is contingent on those organizations’ ability to change and adapt their resources strategically to the nuances of the broadening global playing field. Based on secondary data, it argues that maintaining a domestic compensation program that supports the strategic goals of the organization and meets the needs of employee is a difficult challenge. This challenge is intensified when a similar program must be designed to operate in multiple countries with different cultures. Therefore, this conceptual paper aims to examine the right mix of factors which directly impact expatriate compensation with the most important approaches an organization should contemplate. These contextual factors include cost of living, healthcare, accommodation allowance, expatriate taxes and children’s education. Most factors often integrated as an element of the distinct strategic contingency approaches to discussions: balance-sheet approach and the going rate approach. In order to survive in a competitive world, organizations should consider the concept of ‘wholeness’ within the perspective of compensation packages. In general, this paper was proposed to augment our perceptive to expatriate compensation and using the following recommendations will help the organizations to prepare strategies for the expatriate.
Allard, L. A. C. (1996). Managing globe-trotting expats. Management Review, 85(5), 39-43.
Almalki, M., Fitzgerald, G., & Clark, M. (2011). Health care system in Saudi Arabia: An overview. Eastern Mediterranean Health Journal, 17(10), 784-793. Retrieved from http://www.ncbi.nlm.nih.gov/pubmed/22256414
Barker, J., & Harris, M. (2014, April 10). Mercer webcast: Charting your course for global expansion managing expatriate medical plans. Retrieved from http://www.mercer.com/content/dam/mercer/attachments/global/Health/140410_WB_Managing_Expatriate_Medical_Plans.pdf
Baruch, Y. (2004). Managing careers: Theory and Practice (1st ed.). Harlow, England: FT-Prentice-Hall.
Black, J. S., & Gregersen, H. (2007). The right way to manage expats. In M. E. Mendenhall, G. R. Oddou & G. K. Stahl (Eds.), Reading and cases in international human resource management (4th ed., 119-128). New York, USA: Routledge Taylor & Francis Group.
Briscoe, D. R., & Schuler, R. S. (2004). International Human Resource Management (2nd ed.). London, UK: Routledge Taylor & Francis Group.
Carbery, R., & Cross, C. (2013). Human Resource Management: A Concise Introduction. Basingstoke, UK: Palgrave Macmillan.
Denisi, A., & Griffin, R. (2015). Human Resources (3rd ed.). Boston, USA: Cengage Learning.
Deresky, H. (2011). International Management: Managing Across Borders and Cultures, Text and Cases (7th ed.). New Jersey, USA: Pearson Education.
Dowling, P. J., Festing, M., & Engle, A. D. (2008). International Human Resource Management: Managing People in a Multinational Context (5th ed.). London, UK: Thomson Learning.
Duvivier, F., and Peeters, C. (2011). The use of expatriates in the offshoring of services - Framework and research propositions (CEB Working Paper, 11-59). Brussels, Belgium: Centre Emile Bernheim. Retrieved from https://ideas.repec.org/p/sol/wpaper/2013-105661.html
ECA International. (2012). Expatriate pay packages in Singapore overtaken by those in the Philippines and Thailand. Retrieved September 27, 2012 from http://www.eca-international.com/news/press_releases/7714/Expatriate_pay_packages_in_Singapore_overtaken_by_those_in_the_Philippines_and_Thailand#.VmRlM9J97IU
Frazee, V. (1998). Keeping your expats healthy. Global Workforce, 3(6), 18-23.
Friedman, B. (2010). Managing Expatriate Reward. Retrieved from http://www.totallyexpat.memberlodge.com/resources/Documents/FEM-Managing-Expat-Reward-LR.pdf
Geigle, M., & Malhotra, N. K. (2009). The Expatriate Experience: A Case Study of A Pharmaceutical Company in The European Union. International Business & Economics Research Journal, 8(4), 59-66. doi: 10.19030/iber.v8i4.3126
Haile, S., & Williams, D. (2011). Factors that influence expatriate compensation problems. Academy of Business Research Journal, 1, 25-32. Retrieved from http://web.b.ebscohost.com/
Harvey, M., & Moeller, M. (2009). Expatriate Mangers: A Historical Review. International Journal of Management Reviews, 11(3), 275-296. doi: 10.1111/j.1468-2370.2009.00261.x
Harzing, A., & Christensen, C. (2004). Expatriate failure: Time to abandon the concept? Career Development International, 9(7), 616-626. doi: 10.1108/13620430410570329
Heerden, C. V. (2012). Compensation and Benefits Practices in Africa. Retrieved from http://www.mercer.com/content/dam/mercer/attachments/global/Talent/human-capital-agenda/Anthology%202012/compensation-and-benefits-practices-in-africa-europe-2012-mercer.pdf
Jelinek, P. (2014). Setting Proper Expatriate Housing Allowances and Expectations. Retrieved from http://impactblog.mercer.com/mobilize/setting-proper-expatriate-housing-allowances-and-expectations/
McCallum, B., & Olson, D. (2004). Advising potential expatriate clients: A case study. Journal of Financial Planning, 17(11), 72-79. Retrieved from http://web.b.ebscohost.com/
McEvoy, G. M. (2011). Reducing the Cost of Expatriation in Austere Times: A Case Study of Two Organizations. Journal of International Management Studies, 6(1), 1-9. Retrieved from http://digitalcommons.usu.edu/manage_facpub/59/
McNulty, Y. (2014). The opportunity costs of local-plus and localization approaches to expatriate compensation. In L. Berger and D. Berger (Eds.), The Compensation Handbook (6th ed., 1-21). Columbus, OH: McGraw-Hill Education.
Melvin, S. (2008). Retaining Chinese employees. The China Business Review. Retrieved from http://chinabusinessreview.net/public/0111/print/melvin.html.
Minter, R. L. (2008). Preparation of expatriates for global assignments: Revisited. Journal of Diversity Management, 3(2), 37-42. doi: 10.19030/jdm.v3i2.4988
Mondy, R. W., & Mondy, J. B. (2012). Human resource management (12th ed.). New Jersey, USA: Prentice Hall.
Nazir, T., Shah, S. F. H., & Zaman, K. (2012). Literature review on total rewards: An international perspective. African Journal of Business Management, 6(8), 3046-3058. doi: 10.5897/AJBM11.2423
Neijzen, M., & De Bruyker, S. (2010, July). Diverse Expatriate Populations: Alternative Remuneration Packages. Retrieved from http://www.worldwideerc.org/Resources/Research/Documents/Diverse-Expatriate-Populations-Alternative-Remuneration-Packages.pdf
Noe, R. A., Hollenbeck, J. R., Gerhart, B., & Wright, P. M. (2011). Fundamental of human resource management (4th ed.). New York, USA: McGraw-Hill/Irwin.
Oemig, D. R. (1999). When you say, ‘we’ll keep you whole,’ do you mean it? Compensation and Benefits Review, 31(4), 40-47. doi: 10.1177/088636879903100406
Overman, S. (2000). In sync: focus on international HR. HR Magazine, 45, 86-92. Retrieved from http://www.emeraldinsight.com.dbgw.lis.curtin.edu.au.
Pearce, R. (2013). International Education and Schools: Moving Beyond the First 40 Years. Bloomsbury, UK: A&C Black.
Peng, M. W. (2010). Global Business (2nd ed.). Ohio, USA: South-Western Cengage Learning.
Perelstein, L. (2009, September 14). Impact of assignments to remote locations on children’s education. Retrieved from http://internationalhrforum.com/2009/09/14/impact-of-assignments-to-remote-locations-on-children%E2%80%99s-education/
Phillips, L., & Fox, M. A. (2003). Compensation strategy in transnational corporations. Management Decision, 41(5), 465-476. doi: 10.1108/00251740310479313
Puccino, S. (2005). The right mix of expatriate employee compensation components. Benefits and Compensation Digest, 42(9), 30-33. Retrieved from http://web.b.ebscohost.com/
Puccino, S. (2007). Worldwide Practices and Trends in Expatriate Compensation and Benefits. Benefits and Compensation Digest, 44(1), 34-38. Retrieved from http://web.b.ebscohost.com/
Rahim, S. A. (2012). Compensation issues relating to expatriate managers: A review of related literature. ASA University Review, 6(2), 185-195. Retrieved from http://www.asaub.edu.bd/data/asaubreview/v6n2sl17.pdf
Reiche, S., Harzing, A.-W., & García, C. (2009). Management of International Staff. IESE Technical Note (DPON-79-E). Barcelona, Spain: IESE Publishing. Retrieved from http://www.iesep.com/en/management-of-international-staff-10857.html
Reiche, S. (2011). Expatriate Compensation: A Review. Retrieved from http://blog.iese.edu/expatriatus/2011/11/05/expatriate-compensation-a- review/#sthash.5YlJXUwh.dpbs.
Reish, A. E. (2011). Issues and Values affecting the integration of American Expatriates in Emerging Economies (Master Thesis). Retrieved from https://repository.library.georgetown.edu/handle/10822/553379
Royle, N. (2011). Three Expatriate Compensation Approaches. Global Compensation & Payroll Administration. Retrieved from http://msigbs.com/blog-2/global-compensation-payroll-administration/three-expatriate-compensation-approaches/
Schroeder, J. (2010). Miedzynarodowe zarzadzanie zabobami ludzkimi [International Management of Human Resources]. Wyd. Uniwersytetu Ekonomicznego, Poznan.
Scullion, H. (2005). International HRM: An introduction. In H. Scullion & M. Linehan (Eds.), International human resources management: A critical text (pp. 3-21). New York, USA: Palgrave Macmillan.
Sengupta, N., & Bhattacharya, M. S. (2007). International Human Resource Management. New Dehli, India: Excel Books.
Sims, R. H., & Schraeder, M. (2005). Expatriate compensation: An exploratory review of salient contextual factors and common practices. Career Development International, 10(2), 98-108. doi: 10.1108/13620430510588301
Society for Human Resource Management. (2014). International Assignment: Taxes: How do we handle income taxes for expatriates? Retrieved from http://www.shrm.org/templatestools/hrqa/pages/howdowehandletaxesforexpatriates.aspx
Stahl, G. K., Bjorkman, I., & Morris, S. (2012). Handbook of Research in International Human Resource Management (2nd ed.). Cheltenham, Glos, UK: Edward Elgar Publishing Limited.
Suutari, V., & Tornikoski, C. (2000). Determinants of Expatriate Compensation: Findings among Expatriate Members of SEFE. Finnish Journal of Business Economics, 49(4), 517-539. Retrieved from http://lta.hse.fi/2000/4/lta_2000_04_a4.pdf
Turner, S. F., & Rindova, V. (2011). A Balancing Act: How Organizations Pursue Consistency in Routine Functioning in the Face of Ongoing Change. Organization Science, 23(1), 24-46. doi: 10.1287/orsc.1110.0653
Vogel, A. J., Vuuren, J. J., & Millard, S. M. (2008). Preparation, support and training requirements of South African expatriates. South African Journal of Business Management, 39(3), 33-40. Retrieved from http://www.journals.co.za/ej/ejour_busman.html
Wang, I-M. (2008). The relationship between expatriate management and the mentality and adjustments of expatriates. Social Behavior and Personality, 36(7), 865-882. doi: 10.2224/sbp.2008.36.7.865
Wentland, D. M. (2003). A new practical guide for determining expatriate compensation: The comprehensive model. Compensation and Benefits Review, 35(3), 45-50. doi: 10.1177/0886368703035003006
In-Text Citation: (Al-Kassem, 2015)
To Cite this Article: Al-Kassem, A. (2015). Contextual Factors of Compensation and Benefits Management to Expatriate Workforce. International Journal of Academic Research in Progressive Education and Development, 4(4), 134–147.
Copyright: © 2015 The Author(s)
Published by Human Resource Management Academic Research Society (www.hrmars.com)
This article is published under the Creative Commons Attribution (CC BY 4.0) license. Anyone may reproduce, distribute, translate and create derivative works of this article (for both commercial and non-commercial purposes), subject to full attribution to the original publication and authors. The full terms of this license may be seen at: http://creativecommons.org/licences/by/4.0/legalcode