Not all companies relocate employees or even have operations that involve business travel. Those that do, either deal with each situation on a case-by-case basis or offer a set of benefits based on a formal employee mobility policy. The non-structured approach may be sufficient when relocations are few in number, but when the frequency grows, there are real benefits to adopting a formal policy or program. Once in place, it becomes very clear that a mobility policy is about much more than getting people from point A to point B. It is ultimately about contributing to the foundation required by an organization to reach its business objectives.
In terms of the actual relocation, a formal policy tells transferees upfront what they can expect in terms of support. This helps them decide whether to accept an assignment or transfer and instills confidence that the employer is treating them fairly and will support them throughout. From a corporation’s perspective, the policy provides a level of predictability and cost management, streamlining administration and reducing conflict. It also allows employees to hit the road running rather than having to deal with transition issues and supporting the trailing family.
A carefully crafted policy will address, at minimum, the basic activities and expenses required for a reasonably smooth relocation (e.g., home search trip, travel to the destination, temporary accommodation, destination housing, transportation of goods, etc.) Additional features, depending on the competitive level sought, can be added (e.g., home sale and purchase, equity protection, cost-of-living allowance, destination services, etc.) and provided on a reimbursement basis, through fixed allowances or with an envelope of funds to be used on a customized basis.
Beyond the strict relocation focus, a competitive policy is beneficial to organizations in the following manner:
Employees like to know that they fare well within their industry but are generally more concerned about how they are treated vis-à-vis their colleagues. A key to retention is employee engagement and nothing is more demoralizing and demotivating to an employee than feeling undervalued. A clear mobility policy communicates that all employees within a defined category are given the same opportunity to experience a successful relocation and assignment.
Without a formal policy, it is difficult to convey the value of a proposal to a prospective employee. Top candidates facing competing offers, will likely choose the most attractive package, or at minimum, one that is no worse than what they are leaving behind. An attractive proposition is to provide new hires with enhanced tax-free relocation benefits through a formal mobility policy rather than a taxable hiring bonus.
Organizations benefit from an enhanced reputation within the industry by demonstrating that they:
– Invest in their employees and treat them in a fair, competitive and equitable manner.
– Care about the communities in which they operate by fostering a successful integration of its newest members and forming partnerships with local suppliers.
Whether relocating at a domestic or international level, a formal policy will provide a framework to:
– Gain valuable and pertinent national, cross-border or international mobility knowledge with the help of a network of global suppliers.
– Ensure compliance with immigration and taxation requirements of home and host countries.
– Support and promote cultural diversity through a variety of partnerships that enable employees and their families to immerse themselves in their new environment and fully benefit from the experience.
All this, of course, is predicated on the creation of a competitive policy that is administered in a consistently fair manner. It also assumes that the experiences of the main beneficiaries (i.e. transferees) are evaluated and taken into consideration along with the goals of the organization and the evolving market. It may seem like a lot of work, but the benefits by far outweigh the effort, and in the end will lighten the load. Ward O’Farrell Consultants have the knowledge and experience to assist and guide companies with policy reviews, benchmarking studies, financial risk analysis, service quality and employee satisfaction surveys, process evaluations and audits, and request for proposals. We would be delighted to hear from you.