international compensationin international human resource management.pptx

international compensation

1. Definition and Importance: International compensation refers to the management of compensation for employees working in different countries. It is crucial for attracting and retaining talent in a global workforce. Challenges of International Compensation: Managing currency fluctuations, diverse tax laws, cost of living differences, and maintaining equity among employees. Key Components and Objectives: Components: Base salary, allowances, benefits. Objectives: Attract, retain, motivate, and ensure equity. Photo by Christine Roy on Unsplash

2. Base Salary: Home country salary or adjusted for host country. Foreign Service Premium: Additional pay for accepting international assignment. Allowances: Cost of Living Allowance (COLA), Housing Allowance, Education Allowance. Benefits: Health insurance, retirement plans. Incentives and Bonuses: Performance-based incentives, hardship allowances. Photo by Christine Roy on Unsplash

3. Attracting Talent: Competitive compensation packages to attract top talent. Retaining Employees: Ensuring job satisfaction and loyalty through fair compensation. Motivating Performance: Incentives linked to performance and assignment success. Ensuring Equity and Fairness: Consistent compensation practices to maintain equity among employees. Photo by Duangphorn Wiriya on Unsplash

4. Balance Sheet Approach: Equalizes purchasing power across countries. Ensures standard of living parity. Going Rate Approach: Pays based on local market rates. Aligns with host country's salary norms. Local Plus Approach: Local salary plus additional expatriate benefits. Balances cost control and expatriate needs. Global Market Approach: Uniform compensation framework globally. Promotes consistency and mobility. Photo by Duangphorn Wiriya on Unsplash

5. Home Country Taxation: Tax obligations in the expatriate's home country. Impact on overall compensation. Host Country Taxation: Local tax laws and regulations. Double taxation agreements. Tax Equalization: Ensures expatriates pay no more or less tax than in their home country. Company covers excess tax costs. Tax Protection: Expatriates pay home country tax rate, keep savings if host country tax is lower. Protects expatriate's net income. Photo by Roopak Ravi on Unsplash

6. Recap of Key Points: Overview of international compensation. Key components and objectives. Methods of compensation. Taxation decisions. Final Thoughts: Importance of effective compensation strategies. Balancing cost control and employee satisfaction. Ongoing challenges and future trends. Photo by Christine Roy on Unsplash