While any reward strategy must reflect an organisation's compensation philosophy, there are many additional factors which apply when considering reward in an international context. Should reward be set centrally or should each region or subsidiary develop its own strategy? How are cultural differences being taken into account? What are the financial and non-financial elements?
This factsheet explores the factors that organisations should consider, beginning with the purpose of the reward strategy and what the company wants to achieve. It then focuses on rewarding expatriate employees, looking at the implications and costs of using expatriates and the different approaches of home versus host-based pay. It describes the typical allowances and benefits offered to employees working overseas, such as housing, insurance and a travel home. Finally, it outlines issues around taxation and costs of living.