Money makes the world go round, so I thought I’d talk about some of the items normally found in expat employment contracts. But I would start by saying that very few expats work overseas just for money. Diplomats, those in the military, people who work for charities and NGO’s certainly don’t, people looking for adventure or work experience don’t, and even those whose work is the driving factor generally have many other reasons other than money for accepting an expat position.
First, some
terminology:
Working as an employee is what most people understand it to be. You become a permanent employee of the company and are usually entitled to a range of benefits, such as health or life insurance, savings or pension plans etc. It implies a long term, permanent position although these days most companies won’t hesitate to lay off staff as soon as they’re no longer required, so pay particular attention to termination clauses.
Working as a
contractor, means you are a self-employed individual. Many contractors have their own registered companies (even if they’re the only employee) for tax or liability reasons. Contractors are usually paid on a daily or monthly rate which will generally be all inclusive. In other words, as a contractor it will be up to you to pay for accommodation, health insurance, airfares, mobilization costs as well as any expenses incurred by your family (visas, school fees, etc) if you choose to bring them along. Typically contractors can be terminated at very short notice (eg 24 hours) and the term of the contract is always stated, although it may be extended by mutual consent. Because they receive so little company support, contractors usually get paid higher rates than employees.
Looking at the contract itself it’s important to determine who will pay for what. Some are very complex, with the employer providing many items, allowances and “uplifts” to reflect a high cost or living or hardship location, for example, and perhaps even deductions such as hypothetical tax, to bring the base salary into line with the home country. Others are much more basic, offering lump sum packages which the employee can spend at his or her discretion. Either way the main things to look at are:-
Accommodation. If it’s provided by the employer, there are three broad options:
Provided by the employer. You need to determine if it will meet your needs in terms of size, quality and location. While this can be the simplest solution, as you’ll just walk in as soon as you arrive (and, perhaps more importantly, just walk out when you leave) you have no choice about where you live.
Read all of it at
Expatriate Life