Location Hardship Ratings and Quality-of-Living Allowances
Factors such as climate, disease and sanitation standards, ease of communications, and physical remoteness can often affect the success of a foreign assignment. Moreover, the local political and social environment, political violence, and crime may give rise to potentially uncomfortable, inconvenient, or even dangerous situations. To encourage mobility, reliable information is needed to help calculate fair, consistent expatriate compensation for hardship locations.
The Benefit of Two Approaches
Mercer offers two ways to compensate mobile employees fairly for going to a host site with a lower quality of living than that in their home location. Quality of Living Reports (QOL) recommend a point-to-point comparison assignment premium in order to recognize differences in home and host conditions. Location Evaluation Reports (LER) assess living conditions against generally accepted standards, providing a single premium recommendation for all assignees.