Whether your organisation brings staff into New Zealand, or sends New Zealand staff overseas, it is important to ensure that the remuneration package is just right:
• Underpay your transferees, and they will be more distracted from their jobs, feel disappointed with you, and be less likely to extend or renew their contract if asked to. You lose money in the long run, e.g. due to errors in projects and/or higher staff turnover.
• Overpay your transferees, and you will waste money in payments, cultivate friction with the transferee’s colleagues (local-hire and/or home-country), and set the transferees up for a “let down” upon repatriation.
• Mis-pay your transferees, and you and/or your transferees may incur unnecessary costs.
What makes international remuneration calculations so complex?
• (Fluctuating) international exchange rates and inflation/deflation.
• Differing and complicated dual (or triple) taxation exposures.
• General differences between countries in their standards of living.
• Locale-specific variations in housing, goods & services, utilities, interest rates, etc.
• Inherent living expense differences between short-term, medium-term, and long-term assignments.
• Varying levels of personal interest, resulting in differing levels of financial incentives needed, from the pool of suitably qualified candidate personnel.
• Intangible concerns (e.g. transferee’s isolation from promotion opportunities).
• Differing aspects of “allowances” versus “benefits” versus “incentives”.
• Indirect concerns (e.g. social security implications).
• and much more...
Contact Woburn International now, to learn more on how we can help you avoid costly mistakes.
