The Hindu Business Line : ‘Expat assignments: Challenges galore for cos of Indian origin’

Competitiveness of expat compensation packages, issues with different tax structures and of cost containment are some of the most common challenges faced by companies with international assignees.

In a survey of 40 large companies in India, global consulting firm Mercer found that these challenges were more acute in companies of Indian origin because of the significant costs they have to bear to offset international compensation inequity.

The report addresses India-specific practices as these companies send employees on international assignments.

The study says that rapid global expansion of the India-based MNCs and the resulting increase in employee mobility are forcing companies to address policy issues on international assignments.

“Organisations understand that international assignments, specifically those involving family relocation call for significant investments,” says Ms Gangapriya Chakraverti, Business Leader, Information Product Solutions for Mercer India.

“They would like to ensure that their investments deliver an acceptable return by carefully choosing only the best people for the assignments and making efforts to retain them during and after the assignments overseas.”

Some of the companies admitted that they were ready to reduce costs wherever possible by hiring local staff instead of making an expatriate assignment, reduce or eliminate benefits and allowances associated with international transfers, or look for alternative ways to address pressing business needs.

“Thus, companies have been increasingly relying on short-term assignments as an alternative to long-term assignments in light of the complexities entailed in the latter. They have made efforts to streamline policies and minimise exceptions,” Ms Chakraverti added.

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