My colleagues' and my situation is this: when our company hires people from overseas it will offer a "package" to attract candidates to come. People coming from overseas have additional expenses compared to locals, thus needing some additional compensation to make it worthwhile. Our company signs finite-term contracts with these expats. At the end of the contract, if the company really wants to retain this employee, it may offer to continue the "expat package"; on the other hand if the company thinks it's got the upper hand in negotiation, it may offer just a local-equivalent compensation and tell the candidate to take it or leave it. So my colleague lost his expat perks and just got a salary. I just don't know if he got a salary cut as well...