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International Compensations and Benefits

   

Added on  2021-06-08

14 Pages3096 Words246 Views
INTERNATIONAL COMPENSATIONS AND BENEFITSMG 4120 International Human Resources ManagementAMPATZIDOU NATALIA 218869PROFESSOR: ELENI PATRADUE DATE: 18/03/2021

1TABLE OF CONTENTSINTRODUCTION..............................................................................1LITERATURE REVIEW.....................................................................2Objectives of international compensation package...............................2Main elements of an International Compensation plan.........................2International Compensation Approaches..........................................5CASE STUDY...................................................................................6CONCLUSION..................................................................................9REFRENSES...................................................................................10

2INTRODUCTIONNowadays, as the world evolves, globalization is increasingly and profoundly altering the environment and making significant changes in the technological, geopolitical, environmental, and cultural landscapes are colliding to usher in a new era (Botha, 2019). Globalization is the process of transforming a company's activities and strategies into a diverse range of cultures, goods, and concepts, that is affecting human resource managers' roles (McNulty & Inkson, 2013). So, for companies to be successful they need to adapt to the new reality and expand internationally. An international organization is one that has branches outside of its home country that depend on the parent company's market experience or manufacturing capabilities. In general, a multinational company is thought to have a variety of companies in multiple countries, but is operated as a whole from a single country's headquarters. So, when a company decides to expand abroad the international human resource management needs to find the right employee for the company’s “international assignment”, who will be the expatriate (McNulty & Inkson, 2013). International human resource management possesses the procedure of recruiting, educating, evolving,performance appraisal and compensating workers in foreign and global organizations (Zheng, 2016). Compensation and benefits for the organization's expatriates must be balanced, which necessitates attention to the desires, needs and motivation of the workforce. The aim of this project is examine the essential elementsof an international compensation plan and the approaches to the international

3assignments benefits and compensation on a global scale, by conducting a literature review. Subsequently, there will be a case study concerning Johnson & Johnson and its policies on international benefits and compensation.LITERATURE REVIEWObjectives of international compensation package Compensation is at the core of any company's performance prospect in its wider sense—a viewpoint that managers must take in the international economy. Compensation serves as a meeting place for corporate and individual interests and objectives, facilitating all parties' satisfaction (Vance et al., 2006). A multinational company aims to achieve many goals while designing foreign compensation policies. Initially, the compensation package should be in line with the multinational's overall strategy, framework, and company needs. That is why, it must be competitive and take into account considerations such as foreign service incentives, tax equalization, and reimbursement for appropriate expenses (Dowling et al., 2017).Therefore, financial stability in terms of salaries, social security, and living expenses in the foreign location are expected from the expatriates not only for them, but for their partners and family, too. As well as housing, child schooling, and leisure are all items that the employee can expect to be taken care of. As a consequence, the compensationpackage should answer all of these needs (Rahim, 2012).Main elements of an International Compensation planBase salaryInitially, a main element of the international compensation plan is base salary – which is a set amount of money that does not change depending on how well the employee does. Therefore, the importance of expertise, qualifications, experience, and

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