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Factors in determination of international compensation system: The factors to be considered in determining compensation systems for expatriates include the following:
Cost of living
Knowledge of the laws, customs and employment practices of foreign countries
Exchange rate
Effect of inflation on compensation
Housing cost
Family benefits
Children's education
Relocation allowance
Income tax
Social services
Readjustment to home base
Variations in the methods of payment
Reserves that include contributions to savings, pension schemes etc.
Medical, emergency and security cover
Factors to take into account in the design of the compensation system
The nature of the job , the risks , period, age , experience ,,,,,,
• Other firm’s rates
• Union demands
• Cost-of-living changes
• Firm’s ability to pay
