Ethical Dilemmas in International Compensation
Wurim, Ben Pam

Abstract
The main thrust of the paper is to unravel the various ethical dilemmas in international compensation that shroud and therefore make the job of Multinational Corporations’ (MNCs’) HR managers daunting. The paper draws substantially on research conducted over the last twenty years to see if any progress has been made towards restructuring compensation and reward systems among the three types of MNCs’ employees (PCNs, TCNs and HCNs). We are also interested in how international compensation is practiced among the three types of labor pools of managers regardless of nationality in an MNC. The paper concludes that MNCs have three options of recruiting staff from PCNs, HCNs or TCNs. These options often result in significant difficulties and differences like BSA, HBA and GMA. Also, variations in culture, economic development, laws and regulations, labor unions and living standards are some of the worst culprits responsible for these difficulties. The paper therefore recommends that MNCs should be cost effective in selecting technically competent people by balancing business objectives, goals and budgets with the compensation programs; narrow the gap by developing a balanced pay and reward systems that consider cultural, socio-economic and legal variations.

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