Ed Llarena, Jr.Hi!
This case is a typical Asian business mindset, that looks at Asians as an inferior being compared to Westerners (Europeans/ Americans)---- and therefore should be given LESS benefits than their counterparts in the HQ. The allegation of cost is a very shallow alibi to justify the intent and modify an existing international company policy.
Although compensation and benefits are generally adjusted to regional locations, there are companies (esp those that are 100% foreign owned subsidiaries) that implement HQ pay and benefit policies in all their offices/ subsidiaries. This is the area that you have to look into very carefully. Generally, local partners/ investors feel a certain sense of excessiveness when pay & benefits in Europe/ America are given unilaterally to local employees--- including executives.
When a multinational/ international company decides to adopt and implement its HQ policies for all its offices worldwide (regardless of operational location), any policy modification that would tend to distinguish employee benefits would be suspect.
In a previous company, our EVP decided to change the benefit package of our engineers sent to the HQ on interim assignment (for reasons of excessiveness compared to local standards). The reduced benefits created a problem of unfairness (& discrimination) when the employees later learned that they were given less than their counterparts. The engineers felt more bad when they were told that it was their home (local) office that made the changes. So, the HQ blamed the local subsidiary for the problem, and made them pay the withheld benefits differential ---- which were eventually given back to our engineers.
Ed Llarena, Jr.
Emilla International Consulting Services
From Philippines, Parañaque