Sunday, 27 February 2011

Expatriate Salaries: which structure is best ?

Expatriate salaries are normally made up of an "expat package" which includes, on top of a cash component, a number of typical expat benefits which range from living accommodation to education allowances for children (normally attending international schools) to paid trips back home, tax equalisation, etc.

It is always difficult to judge expatriates compensation. Expatriate benefits are surely an important component of the overall expatriate remuneration. However talking to expatriates you get a mixed feeling about the real value of some of these benefits.

For example you often come across an expat that believes he would be better off if their employer just gave them a salary calculated in such a way to include also the value of expat benefits.

One common complaint relates to the living allowance. A number of employers will provide expats with living accommodation  (i.e. they will deal directly with the owner of the property). This results in the impossibility for the expat to buy the house he or she lives in. Many expats believe that if they just received a cash amount they would be free to decide if they would like to buy or rent.

The above is just an example and, sometime, employers argue that the nature of an expat assignment is such that you do not need to have links to a specific destination (and owning a home would be considered a strong link to a country).

What do you think about this subject ? Do you have different experiences or further examples to share ?

Thank you,

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1 comment:

  1. Hello! that's a very interesting post and I have shared it with my readership. Thanks for raising this question.