HR Glossary

A Checklist for Navigating Corporate Employee Relocation

Streamline your corporate employee relocation with an in-depth checklist for effortless navigation through relocation services.
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Opening a new office, answering an employee’s request to move, or opting for the best talent for an open position – there are many reasons for relocating employees.

However, only successful employee relocation leads to a lower turnover rate, greater talent acquisition, and more development opportunities within the company.

Thus, understanding employee relocation is vital.

Employers and HR teams should learn what kind of corporate programs and relocation services are needed and how to implement them through a written relocation policy to support equal opportunities across the board instead of leaving space for favoritism.

 

What is Employee Relocation?

Simply put, employee relocation happens when an employee moves to another location within the same company. The relocation can be to a different satellite office in the same city but also abroad.

The main difference lies within the intent of the relocation – when the employee initiates the move, it is either a voluntary relocation or involuntary when the relocation is an organizational decision.

Moreover, employee relocations can happen when a single worker is moved to another location, or the move can mean relocating the whole office or department.

Reasons for Employee Relocation

Often, there is interconnectedness between the reasons behind the move and the types of employee relocation. Thus, some of the most common reasons for relocating employees are as follows:

  1. Current Job Relocation – When an employee requires or is being offered a move by the employer, mainly for a better job position, in a different department in the same or another city or country.
  2. New Employee Relocation– Obtaining talent can be challenging, as potential employees are not always located in the area for which there is a job opening. Therefore, companies are offering relocation packages for new hires.
  3. Temporary & Independent Workers Relocation – Usually, temporary workers, independent workers, and interns aren’t employed with a full-time contract and aren’t usually considered when deciding on relocating employees. Still, they can be a part of a relocation strategy when an employee they are shadowing is relocating to another branch. Another case of independent workers moving to other departments or offices is when there is a lack of skilled workers but a high demand, so they move based on those company needs.
  4. Workers with Families – Being close to a family can be a reason why an employee requests a move. Also, even when the family isn’t the reason for relocating, employees with a family will only consider moving if they can bring along children and a spouse.

 

In many companies, these kinds of employee relocation often mean offering different types of packages and services.

Regarding demographics, a survey by Allied shows that:

  • Almost 37% of employees are willing to relocate for a job as a career advancement opportunity and/or for a bigger salary.
  • Close to 18% of workers will move to be close to family and/or friends.
  • 15% of employees will opt for relocation as a change to a new department or office.

Moreover, the same survey shows that workers ages 25-34 are most willing to transfer to another location, as they are most likely to do what’s needed for their professional development and advancement.

Regarding the external factors for relocating in 2022, economic conditions were the most significant reason for moving across companies of all sizes. The second external factor was tightly connected to the “The Great Resignation” phenomenon, or the lack of qualified workers in a particular location.

Employee Relocation Checklist

To make good use of relocating employees and maximize its benefits, a company must have a well-established, written relocation policy as an employee relocation checklist.

Many times, relocation programs differ regarding the position of the employees, their work experience and expertise, as well as the distance of the move.

The length of the worker’s stay in another city or country can be another special circumstance that companies should consider when developing a relocation policy.

A good relocation policy should be designed to follow the relocation process step by step, incorporating any specified deadlines or timelines. The policy should include all expenses for the relocation, such as housing, moving, and travel expenses, and enlist all the support the employer is willing to provide for the employee’s family.

Yet, regardless of the various considerations, once the relocation policy is in place, it should be communicated to employees so everyone can familiarize themselves with it. Then, they can decide whether to move or not after knowing what services they are entitled to.

The Cost of Employee Relocation Services for Employers & Companies

The total cost a company will have for relocating one or multiple employees or a whole department will depend on many factors.

Some of the most significant factors include the distance of the move, travel expenses, type of housing, family support, and more. Below are some of the most common expenses included in employee relocation services:

Employee Relocation Packages

Temporary Housing

Temporary or short-term housing is one of the benefits an employer can provide.

A good relocation policy should set up this kind of housing before the employee moves and arrange the accommodation instead of leaving it as another responsibility for the moving employee.

Moving Costs

The company policy usually covers all or some moving costs, including airplane tickets for distant locations, the cost of gasoline, or any expenses for hiring moving teams, regardless of whether they are an in-house team or an outsourced alternative to relocation transportation.

Relocation Bonus

In some cases, companies offer additional relocation bonuses, which may be listed in the relocation policy or be an extra incentive for employees. These can include cost-of-living adjustments and other monetary incentives.

Executive Relocation

The relocation packages that are offered to high-achieving executives are usually those with the best features and differ from those designed for employees below in the hierarchy.

Companies should communicate these differences transparently to prevent workplace disagreements, divisions, and favoritism.

Expatriation Assistance

When the employee transfers to a different country, the company can help by covering visa/passport expenses and providing paid trips to the new destination to find housing, schooling, childcare, etc.

Mortgage Assistance

Employee relocation programs can also include help buying and selling homes, especially if the current employee’s house remains unsold within a specified timeframe, or as guidance in securing pre-qualification for a mortgage when purchasing a new house at the new location.

Reimbursement

All the expenses for the relocation can be covered as a relocation reimbursement plan that covers all costs based on the receipts provided by the employee.

Lump Sum

Compensation for relocation costs is generally provided via lump-sum payment estimated to cover the expenses during the move.

Benefits of Employee Relocation

Employee relocations can benefit both employees and organizations when executed professionally, transparently, and based on a well-established policy. The advantages of employee relocation consist of benefits:

For Employees

Employees can leverage a corporate move to embrace career development opportunities, obtain knowledge transfer and skill enhancement opportunities, get exposed to new environments, improve their living standards, and more.

For Employers

Some of the most significant benefits employers can have as a direct or indirect result of employee relocation include attracting and retaining talent, ensuring strategic placement of skilled employees, streamlining business expansion, filling positions with qualified workers, introducing cultural diversity in the workplace, and more.

Challenges of Employee Relocation

Besides the many pros, a corporate relocation can have its downsides as well. However, to estimate if the implications of an employee relocation are positive or negative for the company, it comes down to whether the financial benefits surpass the associated costs of the job transfer.

Common cons include poor communication, legal issues, and economic factors.

HR’s Role in Employee Relocation

The human resources department has a strategic role in employee relocation, not only in creating and communicating relocation policies among employees but also in aligning employee relocation with the company’s operational and financial objectives.

To achieve this, HR professionals collaborate with other company departments to ensure a successful transfer of employees.

Some of HR’s roles tightly connected with employee relocations include:

  • Creating and communicating a well-established relocation policy
  • Detecting employees suitable for relocating
  • Hiring an in-house team or finding an external relocation service to convey a smooth transition
  • Addressing legal concerns, tax issues, and more.

To measure the benefits of the overall process, HR teams should also incorporate metrics to evaluate the relocation programs while overlooking all aspects of it.

Work Relocation Future Trends

In recent years, employees have been more reluctant to move to another city or country because of work duties, reaching the lowest annual rate of 6.77% for 2018-2020.

This is primarily due to remote work opportunities that don’t necessarily translate to corporate relocations, rising inflation, relocation costs, higher mortgage rates, and more.

The years after the COVID-19 pandemic have propounded this hesitation as working from home became the new norm for many workers, shifting the landscape as we know it.

Thus, companies should opt for compelling relocation packages for employees, often tailored to specific and individual needs according to a well-designed relocation policy to convince workers to move and demonstrate the program’s strategic value.

Written by Tanja todorovska malakjan

SEO Manager at Shortlister

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