International Human Resource Development - Essay Example

?Table of Contents Table of Contents Introduction 3 Background information 3 Aims of the study 3 Scope of the study 4 Visa Issues 4 Remunerations 6Orientation Program 8 Relocation, Cultural and Family Issues 9 Industrial Relation Issues 11 Solutions and recommendation 11 References 13 Executive summary The development of international human resource and the continued growth of multinationals have made it a common practise to have foreigners working in different countries across the globe. Human resource mobility is attributing to the growth of multinationals and global business and increased international competition. However, the process of recruiting a foreigner into a country like Australia has a number of legal and business related implications which the organisation must consider upfront. This report has thus evaluated the factors that influence the decision of the organisation to hire a German engineer to help increase its car modelling and production. This is a sound idea but a number of factors arising from international human resource management must be considered and given due consideration. This paper finally advices on the best approach that the organisation should steps to help reduce the financial expenses that may arise from this decision. Introduction Background information The process of recruiting and posting of staffs is a major concern in international human resource management to organizations that operate beyond their domestic borders. Recruitment involves the process of searching for and obtaining potential job candidates in a good number and with different qualities so as to enable the organization chose the individual with the best skills. Recruitment for multinationals presents many challenges to organization due to the operational differences that exist in different countries around the globe. Each country also possesses different visa and work requirements for foreigners and this present a number of challenges to different multinationals. As a multinational that operates in Australia, recruiting a German national to work in the country as an engineer requires a number of considerations that each organization must consider and put into place. As a practice in multinationals, staffing may vary from the traditional practices seen in domestic organization. Ethnocentric, polycentric, regiocentric and geocentric staffing orientations are quite common in international human resource management. This decision to recruit a German foreigner thus means that the organization has adopted the use of foreign expatriates to occupy a number of positions in the organizations (Deresky, 2010). The success of such a policy is influenced by a number of factors which include the work visa and the immigration rules of the country. Aims of the study This report will thus evaluate the major issues that will arise and that requires consideration by the organisation in their quest to employ a German national as the engineer to help improve the car production business. It will thus analyse the visa issues and remuneration issues that will be considered by the organization before making this decision. As a foreigner, the company will have to implement an induction program to help familiarize the employee with the work culture of the country and how he can live comfortably in the country with his family members despite the cultural differences. The report shall thus analyse how such a condition will affect the company’s financial and human resource position. Scope of the study In completing this task and achieving the desired aims of this study, the Australian system shall be analysed in line with the emigration and the labour laws of the country. This will enable me analyse the labour related issues that may affect the working conditions for the German engineer and how he may be required to comply with international working permits. In line with the international human resource practises, the remuneration package for the engineer will also be analysed especially to determine how the variation with the local salary package and laws may influence it. The orientation and induction of expatriates is an important element for multinationals and this report will thus highlight the induction programmes that must be conducted to enable the engineer integrate into the cultural and economic systems of the country. Visa Issues The processing of recruiting a foreigner to work in a country like Australia is subjected to a number of governmental regulatory processes that influences the outcome of such a recruitment process. In a multinational setup, it is incumbent upon the organisation to make inquiries with the government on the regulatory mechanisms that may affect the importation of expatriates. This scenario is similar to this situation in which a German engineer is expected to work in the country to help model high calibre vehicles for the organisation. As a condition for importing expatriates, our human resource department must thus seek to furnish itself with the immigration requirements in the country. This section of the report shall provide the necessary mechanisms that the organisation has to put in place and the considerations to make as far as visa and immigration issues in the country is concerned (Deresky, 2010). The Australian government has skilled migration visa requirements that are applicable to foreigners with specific skills like engineers in the automobile sector. The Australian general skills program affects the skilled migrants that are migrating to work in multinationals based in the country. The human resource department will thus be required to provide an expression of interest to the skilled migrant selection register to enable us secure a working visa for the intended engineer. As an engineer that shall be sponsored by the organisation to joining our organisation, the engineer will be subjected to the employer sponsored workers. Employer sponsored workers visa is applied to foreign employees who posses qualifications that an organisation require but may not be able to get within the country. As provided in the description of the employee intended, the engineer has the capability to design and make new models targeting the international paper (Edwards, Ferner, Marginson and Tregasksis, 2007). The organisation will also have to take in the cost of acquiring this visa for the employees as this is part of the requirement by the government. This provision also requires organisations and multinationals to make a commitment to uphold fair work environments for the foreign workers and provide better orientation programs for them. The organisation must this be ready to put in place mechanism of orienting and provision of social amenities. As an employee that requires temporary residence to work in this country for a specific period of time, the organisation must prove to the government that they are in a position to afford the proposed employee. The engineer, as stated in the descriptions has a long experience and is thus by all standards an expensive employee. The provision to pay a particular base salary excluding the benefits to the employee must also be indicated in the expression of interest to the government to prove that they will be able to provide for the employee (Edwards, Ferner, Marginson and Tregasksis, 2007). Importing a German engineer will be an expensive venture as far as the acquisition of the visa is concerned as there are a number of financial commitments to make. The cost of returns of the employee also rest squarely on the organisation and the organisation must also ensure that employing the engineer will not result into breach of the immigration laws of Australia. Remunerations Remunerations in international HRM among multinationals presents challenge to the organisation when seeking to align the salary of the German engineer to that of the domestic employees. Despite the need to attract, motivate and retain high calibre foreign employees to improve its production units and international market share, the organisation must develop a comprehensive and detailed remuneration package for the employee. As a multinational, the pay scheme for international must abide to the international employee policy that facilitates for the transfer of employees in a cost effective way. It must also give fair consideration to equity and administration as a requirement under the Australian labour laws. The increased cost of living in a foreign country with a different culture makes it highly possible to raise the salaries of the foreign employees. However, Australian foreign labour requirements forbid an over inflated pay package for international employees who is against the doctrine of equity in an organisation (Lowe, Milliman, Cieri and Dowling, 2002). Apart from direct remunerations, other financial benefits that shall be provided to the engineer should be given due consideration with the financial ability of the organisation used as basis for this consideration. As a foreigner operating in an environment he is not familiar with, financial protection in terms of benefits, social services and the increased cost of living must be provided. This will definitely raise the salary of the engineer way above that of other employees who are nationals of this country. Other benefits provided to the employee will include housing benefits, education of the engineer’s children and provision of recreation facilities. As an expatriate, the organisation must also make a decision on which base salary policy the government should adopt. This should form the benchmark for deciding whether the payment of the employee will be based on the expatriate’s home country currency or the Australian base salary advanced to employees with such skills and experience (Haile, 2002). The cost of living allowance is another major component of remuneration that the organisation must factor in making salary considerations for the employee. The German cost of living is quite different from the Australian and this makes it paramount for the organisation to factor in the salary for the employee. This may make it necessary for the organisation to pay a cost of living allowance to the employee to cater for the increased cost of living in the country as compared to their home country. This allowance may be phased out later once the engineer has learnt enough about the country’s ways that can enable him to live comfortably in the country with the pay structure provided (Lowe, Milliman, Cieri And Dowling, 2002). The Australian tax system for foreign employees differs significantly from that of the locals and this must be considered by the organisation as the engineer may be unable to know what is expected of him. To provide a tax neutral system to the employee, a step that will cushion him from excessive taxing, the company will have to meet more tax obligations on behalf of the employee. This is referred to as the tax protection policy in which a foreign employee pays no more tax as she would have paid without this policy. The company must therefore prepare to bore adverse tax consequences on behalf of the employee, a factor that must be considered by the management before bringing in the German engineer (Auer, Clibborn and Lansbury, 2012). Orientation Program The decision of the organisation to bring in a German engineer with extensive car modelling experience presents a challenge of developing a proper orientation and induction program for the employee. Induction is an important program that seeks to enhance the knowledge of a foreign employee regarding the country that he seeks to work in. A number of social, cultural and economic factors differ in different countries and its incumbent upon this organisation to help the employee understand how this shall influence his life and work experience in the country (McDonnell, Russell, And Burgess, 2012). Pre-visits are also common in organisations that intend to hire the services of an international expert as it provides the people with a chance to have a prior knowledge of the country. Such pre-visits will be the best times available for the organisation to take the employee around the organisation and make him understand the organisational culture and practises. Such visits can also enable the employee understand the taste of the market that the organisation serves to enable him develop proper designs that suits the demands of the international market. Cultural differences and settings can also be a major reason for organisation for a pre-visit for the employee, a factor that has been shown to influence the life of the expatriate and that of his family (Edwards, Ferner, Marginson and Tregasksis, 2007). Multinationals and other global companies face major cultural disharmony challenges especially among their foreign employees who have just migrated into their country of operation. Cultural diversity and differences is a major international human resource aspect that multinationals must put into consideration when bringing in foreign employees. German and Australia have far wide cultural differences that make it difficult for a German national who lack proper exposure and prior experience to cope and live a comfortable life. Employee induction and orientation is a program that seeks to provide basic introductory session to a foreign employee to enable him/her understands how to live with the social and cultural differences. It is important in ensuring successful transition from one culture to another by enabling them to understand the cultural differences and appreciate the diversity that the new environment will offer (McDonnell, Russell and Burgess, 2012). The cross cultural induction program should thus be organised for the German engineer which should be two day exercise that first introduces him to the organisation and its people and the country’s social and cultural aspects. Organisational induction is important in enabling the engineer to understand how the people within the organisation relate with each other and how people of different cultural background relate with one another and the organisation. As part of the induction, the engineer will also be provided with details concerning his compensation and how it may differ with his previous salary. The relocation benefits, tax and financial issues that may be of importance to this situation will should also be included to the induction program to facilitate full orientation exercise. This information should be provided to the employee at different stages of formalising the engagement depending on the urgency of the issue and the situation (Brewster and Vernon, 2011). Relocation, Cultural and Family Issues As an engineer with extensive work experience and work exposure, it is accurate to conclude that he has a family who are used to a cultural setting that differs significantly to the Australian culture. Cross border relocation involves a number of activities which are both engaging and have psychological impacts to the foreigner together with his family. This present a challenge to the organisation who must ensure that the new employee is safe in the new environment together with his family. Relocation is defined as the art of transferring experience experts from their home country or country of operation where they had established themselves to new markets with different economic settings (ICSC, 2001). In order to help improve the life of the foreign employee, the organisation must endeavour to provide destination support which includes culture and orientation programs, the cost of living analysis and facilitate the provision of a new home for his family. In the case that the employee have still going children, the organisation must put in place mechanisms to ensure that it finds a better school that caters for children educational needs and bridge their cultural gap. In addition, another important aspect of relocation that the organisation must address is the security of the foreign employee and the safety of his family. The human resource management must thus inform the new employee of the current security issues in the country that may affect his stay in the country. Relocation cannot also be complete without the acquisition of a better housing for the new employee that fits his stature, standard and taste. The organisation must thus review its available housing system to confirm if the engineer can be able to fit in or there will be need for external housing. This will be influenced by the size of his family and their needs and the cultural considerations that affects their house structuring (Jauch, 2006). The relocation and acquisition of a house must be done in tandem with the security system and position of the different available housing systems within the organisation’s control. In considering a house for the engineer, the age of his children and the occupation of his spouse must also be considered. School going children will call for a housing that is in close proximity to a school that fits into the requirements of the children. In line with all these, the organisation must assign a relocation manager with the responsibility of acquiring a befitting house for the engineer and his family (Sims, 2005). Industrial Relation Issues The automobile sector in Australia is covered under trade union organisation which makes it mandatory for all employees in this sector to belong to unions. Trade unions and multinationals has been a major issue in international human resource management especially in the developing economies where the multinationals have been accused of using sweat shop kind of operations. This situation is however different as the multinational in question is operating in a developed economy and is planning to recruit the services of an engineer from an equally developed economy (Jauch, 2006). According to a study conducted in 2011 among three major multinational auto companies in Australia, a number of their employees are allowed to belong to the Australian manufacturing worker union. The country has a mandatory requirement that all employees in this sector belong to a union and this applied to all including the foreign employees. As part of the induction process, the organisation must thus ensure that this new employee is made aware of the current union rules and laws in the country and how each affects his stay in the country. This will provide a better basis for the employee to make decisions based on the available information provided by the organisation. Union membership has a number of financial commitments that each member must fulfil and such differ from one country to another. Such information must also be made available to the employee well in advance to enable him understand the benefits and deductions that shall be made to him (Lowe, Milliman, Cieri and Dowling, 2002). Solutions and recommendation The process of recruiting the services of a foreign expert involves a number of factors that calls for due consideration by the organisation. This wills it easier for both the company and the foreign employee to correlate and improve the position of the company. Based on the current business and automobile environments in Australia, bringing in a foreign expert seems as an expensive venture that the organisation should try to avoid. However, the description of the engineer makes it possible to conclude that bringing in may help to improve the position of the organisation in the international markets. The company should therefore make all the above considerations before bringing in the expert. These include ensuring that the visa and immigration concerns are taken care of and a relocation office is created to help coordinate the relocation program and financial advice provided to the employee in advance. References Auer, P., Clibborn, S. and Lansbury, R., 2012, beyond our control: labour adjustment by multinational auto companies in Australia in response to the global recession, Geneva: international institute of labour studies. Brewster, C. and Vernon, G., 2011, International human resource management, Henley school of business, university of reading. Deresky, H., 2010, International Management: Managing Across Borders and Cultures. 7th Ed, New York: Pearson Education. Edwards, P., Edwards, T., Ferner, A., Marginson, P. and Tregasksis, O., 2007, Employment Practices of MNCs in Organisational Context: A Large-Scale Survey, Feedback Report for Participating Companies. Economic and Social Research Council, De Montfort University, Kings College London and Warwick Business School. Lowe, K., Milliman, J., Cieri, H. And Dowling, P., 2002, international compensation practises: a ten country comparative analysis, Human Resource Management, Vol. 41, No. 1, Pp. 45–66. Haile, S., 2002, Challenges in international benefits and compensation systems of multinational corporation, the African economic and business review. ICSC, 2001, A framework for human resource management, international civil service commission. Jauch, H., 2006, the strategies of multinational companies and trade union responses, labour resource and research institute. McDonnell, A., Russell, H. And Burgess, J., 2012, a profile of human resource management in multinational enterprises operating in Australia, Melbourne: Victoria University. Sims, R., 2005, expatriate compensation: an explanatory review of salient contextual factors and common practises, New York: Emerald group publishing limited. Read More