Summary

	Do your homework and learn how to negotiate fair compensation.
	Expats and local hires have different entitlements.
	Assistance is often available to assist in your move overseas.

Jennifer was excited to receive an offer from her company to transfer to its Hong Kong office. She grew less enthusiastic, however, when she learned of the compensation package she was offered. It didn't seem to match the cost of living in such an expensive locale and her company wasn't going to help her find housing, She was also expected her to break her lease and move by a certain date -- something that would cost her over a thousand dollars in compensation to her landlord. She wasn't sure how to negotiate for a salary that wouldn't cause her to lose money by taking an overseas assignment.

Related Info. When You're Entitled to More Hardship allowances are paid to expatriates working abroad in environments that are substantially different from one's home country, and where stress and uncertainty are common. Examples include areas where access to healthcare is difficult, where war is ongoing or threatened, and generally, where stability or security is in question. Allowances vary by country or region, and are often paid as a fixed percentage applied to gross or net salary. Additional Resources www.expatforum.com - Cost of living indexes for over forty countries www.jobbankusa.com - Information, listed by country and region, on different human resource and salary issues

Jennifer's dilemma is all too common. Many individuals receive offers to go overseas and accept them without knowing about all the details that need to be worked out. One of the most important issues, of course, is compensation. It is difficult to obtain specific information about compensation awards in different countries, but you can make yourself more knowledgeable about this issues involved in expatriate salary decisions. A little research can set you up to make a more stress-free transition overseas.

Expatriate vs. Local Hiring

Individuals are basically hired either as expatriates or local hires. Expatriates, a term which refers to individuals being sent from one country to another, are usually paid quite handsomely -- an expatriate package usually costs a company approximately two to three times an average local salary. This generally includes salary, a COLA (cost of living adjustment), housing and sometimes a car. Because expatriates are so expensive, companies are getting more savvy about who they send abroad. These assignments are often (not always) saved for mid- to senior-level professionals with an organizational track record or a specific technical expertise.

Some companies will offer you a job if you are willing to come on as a "local hire." Essentially, that means agreeing to salary and benefits that a national from that country would receive. For example, if you are working for a company in France, you will be treated as a French national, whether you are Thai or American. This is an issue for some people, particularly Americans, who are used to higher salaries than what is commonly paid in many other countries. However, if you can have the attitude that it's better to live like a local, you might be offered an interesting and fulfilling assignment.

Taxes

"Taxes are one of the most difficult things to navigate when working overseas," says to one expert in the field that I interviewed. Generally, as an expatriate, you pay taxes to your home country. Your human resources department will either take care of this for you or explain the details of how it is done. However, in many countries, you will also be taxed as a national from that country. Many employers will somehow compensate you to make sure you are not paying double taxes. At the very least, they might pay for some sort of legal advice from a tax attorney. If you are not convinced that your organization has done their homework on this issue, make sure you do your own! This is important -- you don't want to incur any penalties from the IRS!

Don't Forget Benefits

Is your vacation time the same as your American colleagues are getting, or is it adjusted to reflect the norm of the country to which you are going? For example, if you get three weeks in the US but are being sent to Europe where the norm is four to six weeks, are you getting the European equivalent? How is your health insurance covered and paid? Does your overseas assignment impact your 401K? These are important questions to explore before you accept an assignment.

Companies who have been sending individuals abroad for a long time tend to have established fair and comprehensive compensation policies. However, organizations that are new to the global marketplace and the expatriate administration experience may not have had the opportunity to research and set appropriate standards. Individuals who try to conduct this research themselves are often frustrated -- there are very few accurate and complete resources available. One professional in the field suggests that you "should really push for the company to do this for you;" it is standard practice and they can have access to consultative services and information (for a fee) not available to individuals.