Reference no: EM132334373

Assignment: Your boss announced a major budget cut for each department. One of the areas he wants to cut is the home leave allowance for the expatriate employees. You know this is a good benefit that helps the morale of expatriate family members as well as the employee, and losing it will also hurt in recruiting talent to serve abroad in your subsidiary companies. How would you convince the boss to keep this program? What would you suggest replacing instead of the home leave program?

Reply to my classmate response to the above questions and explain why you agree? (A minimum of 125 words or more)

Classmate's post

A full expatriate package with premiums, base pay, different arrays of allowances and other perquisites is generally very expensive as compared to an individual base salary. As such, reducing costs is a very important action for management. Despite this, I believe that a compensation system in any organization must finely balance adequately motivating and rewarding expatriates while at the same time keep costs under control for the entire management. Home leave allowance is very important as it help employees on international assignment to maintain their family ties as well as help them stay current with their home country's business associates and contacts. Maintaining ties with their home, families, friends and even business associates does not only motivates them to work harder but also assist them in a less stressful and smoother transition. Cutting the home leave allowance for expatriate employees is therefore not the right way to go about the budget cut due to reduced morale, hurting the recruiting talent and different other disadvantages. Instead, I think other measures should be put in place. For instance, the company should look for an alternative to the already existing traditional expatriate policy. For instance, have local hires where policies state employees will be transferred to the new country's payroll with an exemption of repatriation guarantees or ongoing benefits. Additionally, a tiered policy may be put in place where employees can take the standard long-term assignment policies that are offered by the company and tier it based it on salary, job grade, level or any other factors rather than using one-size fits all approach. Additionally, the duration of a long-term assignment can be reduced in order to cut costs.