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International Costs and Benefits

Salaries and benefits for international jobs will involve many more considerations than those normally associated with jobs in the United States. If living abroad, an international job involves moving expen-ses, currency issues, housing considerations, and a host of other questions that could have a very negative impact on your salary base. If, for example, you have two school-age children who will move abroad with you and you fail to ask about educational provisions and allowances, you may be shocked to discover that it costs $12,000 a year for tuition per child to send them to the private international school. Even a $65,000 a year salary will not go far if you have to pay such tuition costs. Hopefully, the employer will take care of such education-al expenses -- but only if you address this question as part of the salary and benefit negotiations.

Some of the most important salary and benefit-related questions you need to raise prior to accepting a position are these. While they may not be important for some international jobs, they are very important for other jobs. If you fail to raise many of these questions prior to accepting a job, you may be in for some unpleasant surprises that could very well sour your international experience:

Immigration, visas, work permits, and customs: Who will take care of all the legal matters involved in working in this country? This includes getting the proper visas and work permits for you and your family. And who deals with customs, especially if you want to bring your computer and camera with you and the local regulation prohibit duty-free entry of such goods? The employer should have a policy regarding these matters as well as staff members who handle the details of immigration and customs. While the employer may handle the work permit for your particular job, what about a work permit for your spouse who may want to work in this country? How difficult will it be to get one? What are the restric-tions in terms of entering and exiting the country? In some countries your visa may prohibit multiple entry into the country. In other countries the government requires tax clearances every time expatriates leave the country, which can be a very time consuming and expensive process. You don't want to discover that this attractive international job which ostensibly permits you to travel abroad actually prohibits you from traveling outside the country once you begin working there!

Moving expenses: Who pays what for moving you, your family, and household goods abroad? Most employers will provide round-trip air transportation for you and your family. They also provide allowances for household goods -- both to and from the job destination. These allowances are either a dollar or a sea freight weight amount. Be sure you also ask about packing along with freight. Freight normally does not include packing, which can be very expensive. You want the whole package -- packing, pick-up, delivery to the docks, sea freight shipping, dock fees, trans-shipping, delivery, unpacking, and any special fees involved in moving your goods from your original destination to the final destination. Most employers will pay all of these costs, but only within certain ranges. Try to get the maximum range possible. You might want to "back-load" the shipping allowances -- a smaller figure for shipping your goods to your destination but a larger figure for shipping your goods home. Our assumption is that you will purchase many things abroad and thus return home with more items than you left with. In fact, you might consider taking as few household goods as possible with you in expectation of making many pur-chases abroad. Your shipping allowance will enable you to "import" a great deal. Keep in mind that sea freight takes anywhere from six weeks to three months before you will receive your shipment. Consequently, you should also negotiate both an excess baggage amount and air freight allowance for moving those things you will need immediately upon settling in abroad. If you don't, you will either arrive abroad with two suitcases per person or incur a very expensive excess baggage and air freight bill that may be several thousands of dollars.

Air transportation: Most employers will provide round-trip air transpor-tation for you and your family. However, make sure this provision is in writing. Also, many employ-ers will provide business-class rather than econo-my-class transportation. Don't expect first-class transporta-tion. Some employers may only provide one-way transpor-ta-tion. Many may expect you to reimburse them for both the air transporta-tion and moving expenses should you voluntar-ily quit your job within the first 12 months. This is common practice since moving an employ-ee abroad is very expen-sive. International employers expect some type of mini-mum commitment on your part.

Home leave and vacations: Most international employers have home leave provisions in their employment contracts. The home leave provision usually provides round-trip air transporta-tion for the employee and family after a one year, 18-month, or two-year period and involves three or four weeks of paid vacation. Make sure there is enough money built into this provision so you can make several stops along the way home. Many employees use this home leave time to do some much needed international pleasure travel.

Housing: One of your major expenses will be local housing. Depend-ing on where you live, you may well be paying US$2,500 to $5,000 per month for housing. Make sure the employer covers most of this cost or the cost is significantly reflected in your salary base. In many cases employers will provide a housing allowance which allows you to choose your own level of housing. In other cases the employer provides the housing directly. This may involve a company apartment or housing compound. Also figure in your housing the cost of utilities -- which can be very expensive in some countries, especially electrici-ty -- and maids, servants, guards, and gardeners. In many countries it is essential that you hire maids and servants because they are not do-it-yourself societies. Simple living matters, such as shopping for groceries, cooking meals, and washing laundry, are still major chores in many countries. You may need full-time staff to get these things done. In many countries you will also need to hire a full-time private guard to look after your home. Hopefully, this person will also have some gardening skills. You may also want to discuss a home furnish-ing allowance. In some countries housing is very basic -- devoid of such items as closets, window treatments, air-conditioning, and telepho-nes. If you have to purchase your own cupboards, wardrobe cabinets, bookshelves, window blinds and curtains, air-conditioners, and a telephone connection, you may discover you just added another US$5,000 to your housing expenses.

Local transportation: Will the employer provide you with a car, a car and driver, or arrange to have your automo-bile shipped abroad. You will be better off with a car and driver in those countries where driving is a hassle, the cost of purchasing a car is prohibitive, and importing is not a viable option given high local import duties. In many countries the local transportation issue may not be important because of the excellent public transportation system. Perhaps you can negotiate a local transportation allowance should you frequently need to take a taxi to work or hire your own car and driver.

Education allowances: If you have school-age children accompanying you abroad, make sure you address the educational expense questions. In countries with good international schools tuition costs can be very high -- from US$10,000 to $15,000 per child. In other countries which lack good schools, you may have to send your children to a boarding school in another country. Expect to pay another US$5,000 to $8,000 for such schools.

Currency and salary payments: How will you be paid? Will the employ-er pay you in local currency or in U.S. dollars? If in U.S. dollars, will your paycheck be deposit-ed in a local U.S. dollar account or in a bank back home? While these questions may not seem important, they become very important if you work in a country with high inflation rates. A seemingly high salary paid in local currency may be quickly eroded in an high inflation-ary economy. If you work in Latin American, it's best to be paid in U.S. dollars. If you work in Germany or Japan, it may be best to be paid in local currency which is stronger that the U.S. dollar. In many other countries which tie their local currency to the U.S. dollar, it's best to get paid in U.S. dollars as well as have your paycheck deposited in a bank back home since many of these countries have restrictions on how much money you can take out of their countries. You don't want to accumulate savings in the country and then discover you can't take the money with you!

Insurance: Most international employers have some type of insurance coverage. However, some may not or their policies provide limited coverage. Be sure to look over your insurance provisions in detail. Keep in mind that if you should have to be evacuated for medical reasons, the cost of special medical air transportation back home can run from US$8,000 to $20,000. If your insurance policy does not provide such coverage, consider taking out special coverage for such medical evacuation. Many a tourist -- as well as international employ-ees -- have been shocked to discover such medical bills were not covered in their insurance policies.

Special privileges: In some cases, especially for govern-ment workers and consultants and contractors working on U.S. government contacts, employees receive special privileges not normally provided to other international workers. These might include access to shopping in the commissary, international mail at U.S. domestic rates, and importing and exporting personal goods duty-free, includ-ing an automobile.

Spousal employment: One of the most difficult problems today's international workers encounter is the spouse who is unhappy with his or her employment situation abroad. This has increasingly become a major problem in two-career families where the one spouse is hired for the job but the other is left languishing in the local community with nothing to do other than attend the house and look after the children. It is a cause for many divorces among international workers. Increas-ingly more and more families are either choosing not to move abroad or are terminating early because the spouse is unable to find fulfilling work. We recommend that you address this potential problem head-on with both your spouse and potential employer. You and your spouse must be prepared for an un-employ-ed spouse situation abroad. On the other hand, many international employers are increasingly sensitive to this problem and will provide job assistance for the spouse. In some cases -- depending on the job require-ments and skills of your spouse -- a job-sharing arrange-ment can be worked out where you and your spouse work on the same job together. In other situations the employer can offer another rewarding job within the organiza-tion or knows of other local organiza-tions that might be interested in hiring your spouse. The employer then provides you with the necessary contacts for ap-proaching these other employers. Whatever the situation, we highly recommend that you raise the question of your spouse's employment at this stage. While it is a personal question that some candidate may feel is inappropriate to raise with a potential employer, it is one of the very important per-sonal questions you must raise if it is likely to become a problem. More and more interna-tional employers under-stand this concern and are willing to assist employees in making sure their family situations remain stable and supportive throughout while living and working abroad. In the meantime, a good book on this subject is Fran Bastress' The New Relocating Spouse's Guide To Employment: Options and Strategies In the U.S. and Abroad. Couples and families should not move abroad before reading this book and considering this critical employ-ment question.

Starting on the payroll and advances: This can be an important negotiation point that makes a significant difference in your initial income and cash flow. When will be employer start you on the payroll? The day you arrive in the office? The day you depart for the job? One, two, three, or four weeks before your departure? Remember, the process of arrang-ing your private affairs and moving abroad takes time. In addition, you may have to do some special preparation work or meet with the employers representa-tives prior to arriving in country. Many employ-ers will start you on the payroll prior to departing for the job or arriving at the job site. Try to get on the payroll as soon as possible, especially if you are leaving one job and then having to spend several days or a few weeks arranging your personal and profes-sional affairs. Someone should pay for this time since you have to take it in direct preparation for the job. In some cases the employer will give you a per diem -- a per day rate -- for this transition period rather than put you directly on the payroll. At this point, anything is better than receiving compensation only when you arrive at the job site. In many cases the employer will also advance you the money to cover your moving expenses, transportation, and per diem and perhaps some of your first month's salary. It's best to raise these questions with the employer before you find yourself cash poor for financing your transition and move abroad.


Excerpted from The Complete Guide to International Jobs and Careers by Ron and Caryl Krannich, Ph.D.s.
Copyright - Impact Publications 1992
Reproduced with permission from Impact Publications
9104-N Manassas Park, VA 20111-5211; 703/361-7300
1-800/361-1055 or info@impactpublications

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