Discuss the Challenges Related to Compensating Employees from Other Countries

Discuss the challenges related to compensating employees from other countries.
Market pay structures can differ substantially across countries in terms of both pay level and the relative worth of jobs.One reason for such differences is a shortage of talent in local labor markets.Differences such as these create a dilemma for global companies: Should pay levels and differences reflect what workers are used to in their own countries? Or should they reflect the earnings of colleagues in the country of the facility,or earnings at the company headquarters? If the standard is that of the higher rates in the home country,the employees in the host country will likely see the expatriate's pay as unfair.If the standard is that of the lower pay in the host country,the company will likely find it impossible to persuade an expatriate to take an assignment in the host country.Dilemmas such as these make a global compensation strategy important as a way to show employees that the pay structure is designed to be fair and related to the value that employees bring to the organization.These decisions affect a company's costs and ability to compete.However,that conclusion oversimplifies the situation for many companies.Merely comparing wages ignores differences in education,skills,quality,and productivity.