The paper tells that three interconnected factors seem to bring the outstanding differences that appear in the pay practices the economy, laws, and culture. The wage level of different countries varies mostly with the level of development of any economy. With the exceptions of minimum wage and equal pay, some governments stay out of wage setting. This may not true in other countries. Majority of the countries control wages through an incomes policy this practice has declined in the recent past due to globalization. Wage boards or councils that stipulate national wage rates for many jobs are common features in some countries. Some encourage national wage rates through collective bargaining. The culture affects pay practices in several ways. For example, the Japanese form of culture, which values unity over the competition, is not a suitable environment for the individual incentive programs. In his wage setting process, the researcher will consider the impact of these forces on the process. Different organizations vary in how they remunerate jobs. The reasons for this can be grouped into, differences in prosperity, purchasing power, internal business factors and social factors. Some of the key factors that the author will look into when he is developing wage structure for the local managers, engineers and manufacturing staff will include the following. Business factors relate to the business done and the organizational policies used to run the business. There are some companies that are more sensitive to wages than others, hence incurring high labor costs. In addition, some differences arise in the productivity which relating to capital equipment and the level of expertise of the employees. Organizational strategies may mainly focus on offering their employees with security, and this, in return, makes them earn the low income or vice versa. The researcher will also critically look at the level of the economy in general and how it will impact the wage rates. Prosperous countries will pay higher wages; however, this may be deceiving.
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