1. Brian K. Rakowski
January 11, 2012
In the field of international human resources, many different obstacles face both the
company and the employee who is being deployed. The concern that I found the most
interesting was the compensation factor employees receive for international assignments. After
deciding on this topic I searched the internet and found an extremely informative article on the
subject written by Michael A. Conway, entitled International Business – Expatriate
Compensation.
Mr. Conway’s article explains the current methods utilized by most companies for
benefits such as living allowances as well as schooling and other family expenses. His article
explains that companies typically utilize a balanced expense report for their overseas employees
listing maximum amounts for reimbursement on these expenses. The article suggests utilizing a
different technique which provides a lump sum according to the employees pay grade equivalent
to their position back in their home country. This would eliminate many of the problems that
both the company and the employee face during their expatriate experience.
One of the major concerns that the article addresses for the employee is that instead of
handling their own financial concerns, the company addresses these concerns for the employee.
Since they have no concern for the cost of their luxuries, as long as they don’t exceed their
maximum allowances, the employee and their family live in a fashion that would be unavailable
to them back in their home country. This tends to cause a form of resentment as well as an
extended period of readjustment once the assignment is completed. During this period, the
article states that the company could be spending as much as twenty five percent extra as
opposed to what the employee actually needs to maintain an adequate living standard.
Employees also tend to avoid savings during this period as they wish to explore the cultures of

2. Brian K. Rakowski
January 11, 2012
their visiting country. A lump sum technique would help offset this expense as the employees
are responsible for their own expenses overall.
I feel that this article is crucial to this week’s lesson as we have discussed incentive
programs in theory but not detail. Understanding the details that are included in this package
would allow us to make insightful decisions regarding expatriate allowances for a win-win
situation for both the company and the employee.
Conway, Michael A. (February 13, 2008)International Business - Expatriate
Compensation, Ezine@articles. Retrieved from http://ezinearticles.com/?International-Business--Expatriate-Compensation&id=984415