America is a portable society. One in each of five families moves each year, according to an article by Economic Research Institute. A significant number of these moves align with the organization for which one of the family members works. These movements might be to an area significantly past the current driving distance, an alternate state, or a far-off country. The representative might be a fresh recruit or an existing worker at any level, to a top executive. 

Movement Includes Costs, Both Money-Related and Psychological. Money-Related Expenses Include:

• Selling and purchasing houses
• Transporting household goods and personal items
• Temporary lodging
• Immigration and tax expenses

While financial costs are essential in relocation, it is also the interruption and disruption of the employee’s life and their family. The movement from one city to another is life-changing and is one of the top stress producing events in someone’s life. It is imperative that the company supports and assists the employee with the adjustment to their new location. A relocation failure is not only a waste of a company’s money, but it also might mean the loss of a valued employee.

A smooth move will result in a more productive employee and make the adaption of the family to the new community seamless. While it’s never easy, there are tips for making your next employee relocation experience straightforward and easier. 

1. Be Clear About Relocation Policies 

Relocation is a significant life event that effects not only the employee but his or her family life as well. Each party should feel the interaction is reasonable, particularly about the relocation policy being provided. Having clear and well communicated policies forestalls false impressions and improves the probability of a successful move. 

Workers need to realize what’s paid for and what is not. They need to learn the organization’s relocation policy and benefits, and they need the data recorded to them in a letter of understanding. This shields you from false impressions that emerge in verbal arrangements, and it provides a prepared reference to representatives. 

2. Manufacture Relocation Partnerships That Add Value 

Develop partnerships with relocation organizations that can help you navigate the relocation process and provide guidance on appropriate policy benefits. 

Banding together with WHR Group, Inc. (WHR) would be advantageous. WHR adds consistency for your employees which provides equity to the relocation process and keeps your relocation budgets to the spending estimates. 

3. Think about Cost-of-Living Differences 

There is an obvious difference in cost living in a city like San Francisco versus a mid-market city like Grand Rapids, MI.  Are you prepared to address such living differentials with either a relocation bonus, COLA (Cost of Living Differential), salary adjustment or a combination of all?  It will be needed if you want a productive and satisfied employee. 

4. Move Employees Who Embrace Change 

What tools are you utilizing to ensure you have an employee that is open to change and wants to make the move.  Have you implemented any testing or evaluations to determine an employee’s appetite for change?  More importantly is the employee’s spouse and/or family interested in a relocation?

5. Make a Solid Plan 

Having a marketable strategy, outlining the course of events, financial planning, and other significant subtleties will assist with saving you significant challenges down the line.

6. Engage Employees with Resources 

 Plan your relocation benefits so they assist employees with feeling enabled and empowered. Share an outline of neighborhoods near the work area or office assists the employees with narrowing their quest for homes or living arrangements. Better yet, provide a look-see visit for the employee and spouse so they can tour the location and picture their family living in the new city. 

7. Have Kindness and Patience 

One of the more practical corporate relocation tips is to have compassion and patience. It is not difficult to fall into the pressure that accompanies a significant move, so make sure you are dealing with empathetic partners that can appreciate the stress an employee is undertaking. 

8. Permit Enough Time 

Lastly, time is something that we never appear to have enough of, so we recommend giving extra for the significant move. While the move will take time, not providing a plan or days to complete the move will make for an unproductive employee and they will end up wasting time at work to complete their personal move. 

Last Words 

Realize that though this won’t be a stroll in the park, it is certainly something that can be cultivated effectively.

WHR can assist with guaranteeing your worker movements are smooth and consistent. As well as applying these corporate movement tips, dive deeper into WHR relocation solutions and how they can help assist in moving your workers.

Relocation expense management can be a complicated and stressful process for a transferring employee. Relocating employees might have a dozen expense reports to submit over the course of their relocation, and that can be difficult for a transferee to self-fund. Having a seamless, efficient relocation expense management process is critical. Here are five simple tips:

Tip 1: Fast Reimbursement Processing
Through WHR Groups’s intricate survey process, we’ve found that there’s a direct correlation between the timeliness of reimbursement and employee satisfaction. We cannot stress enough the importance of quick fund turnaround. Communicate with relocating employees what the timeline is, since this can help them plan accordingly and know when to expect the reimbursement. Hopefully, your Relocation Management Company (RMC) processes expense reimbursements in 3 days from receipt.

Tip 2: Ensure Accuracy with a Dual Review
Accuracy is critical in expense report review, so having more than one set of eyes review is a must before reimbursing. At WHR, one review is completed by the policy expert and another by an accounting team member. This ensures compliance and accuracy.

Tip 3: Provide an Easy and Accessible Employee Interface Tool
Deploy an online expense submission system that can be accessed anywhere, 24/7/365. Give employees the ability to upload receipts via a mobile app or web portal in any currency. This saves time and the hassle of scanning in countless receipts. This is also helpful while employees are traveling.

Tip 4: Utilize Custom Expense Reports
To streamline expense report review, build custom reports for each relocation policy. This ensures employees stay compliant with policy benefits and it also helps your organization during the internal review. If you’re using an online technology, be sure the system has your policy parameters built into it. WHR can customize reports on over 3,000 different data points, at no additional charge.

Tip 5: Ensure Security of Payment Information
Make sure your RMC utilizes technology that implements security measures:

• Social Security numbers, bank account numbers, and other private data encrypted and masked within the technology when the user is not updating those fields.
• Each personal data field is masked with ********** until the user selects a specific field to view. If the user has access based on his or her role, the data can be viewed and updated only when the field is selected.
• Firewalls are in place to isolate website traffic from the internal network and security has been implemented to control client/server communications from the web portals.
• Protection is used on all internal workstations and servers for anti-virus, spyware, and zero-day threats. Web content is filtered by an on-site application to protect users from accessing risky websites.

Take a hard look at your current expense management process and see if these tips are being followed. A well-run relocation expense management process can make or break the relocation. If you’d like additional help managing your expense reimbursement process or your relocation program, contact WHR Group.

A well-designed employee relocation policy will improve the transferee experience, control organizational costs, meet employees’ needs and help you win new talent. Improving the employee experience means reducing stress so that employees can focus on work roles in their new locations. Relocation policies are not a one-size-fits-all! If you are seeing the same repeated exception requests over and over, consider adjusting your policy.

Below, we share some employee relocation policy best practices.

I. Home Sale

Guaranteed Buyout (GBO) or Buyer Value Option (BVO)

• Offering a GBO can be risky for your organization since it guarantees employees a home sale based on appraisal value, but if the home is not sold then your company takes the home into inventory and must resell it.
• A BVO, on the other hand, significantly minimizes the organizational risks seen with a GBO since your company purchases the employee’s home only after the employee secures an outside buyer.
• Some companies offer a GBO to their executives and a BVO to non-executives.

Direct Reimbursement (DR)

Many companies will offer a DR in addition to a GBO or BVO.

Advantage of a DR

• Your company does not have to bring unsold homes into inventory since employees are responsible for selling their home and paying closing costs/commission fees up front.

Cons of a DR

• No tax benefit for your company or the employee.
• Your company will incur additional gross up cost (assuming you offer gross up).
• Employee is responsible for all costs up front (closing costs, commission fees, inspections, etc.).

Home Inspections

Most companies require a full home inspection for a GBO and BVO program. The home inspection is ordered by the Relocation Management Company (RMC). An inspection helps reduce risks of the company purchasing a home with unknown significant defects. The transferee is required to complete all necessary repairs before moving forward in a BVO or GBO program. Some companies want to avoid being too picky about required repairs, so an alternative to a full home inspection would be a major component inspection, as well as other specialized inspections if applicable, including the following:

• Well
• Septic
• Radon
• Termite
• Stucco

If there are suspected issues in other areas, additional specialized inspections might be ordered if the RMC determines it’s necessary, including the following:

• HVAC
• Roof
• Interior plumbing and/or electrical
• Structural/foundation

Home Sale Bonus

A home sale bonus can be an incentive for employees to sell their homes quickly.

• Beneficial to your company if you offer a GBO; offered less in a BVO program.
• Decide where you will cap this benefit, and if the cap will vary dependent on employee’s role. Many companies base it on a percentage of the sale and/or offer a higher bonus for those that can sell their homes within a desired timeframe.
• This is not required in today’s real estate market as homes are selling quickly as demand greatly outweighs the supply of available inventory.

Loss on Sale

Some companies offer a loss on sale, whereby the company provides an additional benefit to employees selling their homes for less than the original purchase price. This benefit is more prevalent with executives versus non-executives (usually at a capped amount).

II. Rental Assistance/Lease Break Assistance

Benefits can help transferees with early lease termination and finding a rental in the new work destination. Providing rental assistance can also help minimize move stress and ease transition into the new work role. If you choose to offer rental assistance, consider how many days of rental search you want to cover.

• Placing caps on rental assistance ensures your company is containing costs. If a transferee exceeds the cap, decide whether to provide an exception benefit on an individual basis.
• Encourage transferees to negotiate with landlords to insert a diplomatic clause into the lease that reduces future lease break fees.

III. Destination Services

Moving to a new location can be stressful. Area orientations, home-finding trips, destination closing cost payments, temporary housing and settling-in services can help ease the burden of a relocation. By providing destination services, the transferring employee will be able to focus on their new role sooner.

Temporary Housing

Providing fully furnished temporary housing can offset any meal reimbursement since temporary housing includes equipped kitchens.

House Hunting Trip

Providing a travel lump sum will simplify the process and allow employees to book/pay for house hunting trips.

Destination Closing Costs

Many companies will offer this reimbursement to executives versus non-executives.

• Capping support is a way to control costs for this taxable benefit, especially if your company is providing gross up. This could be especially helpful when moving employees to high-cost housing destinations.
• Only allowing reimbursement of typical closing costs is recommended to ensure your company is not reimbursing items that are non-standard.

Renter Destination Services

Some employers offer closing cost assistance to current renters buying a home in their new location.

• If you decide to provide this benefit, decide who will qualify. Only new-hire or existing employees, only executives or based on job level?
• Although it’s not the most commonly offered benefit, an incentive to rent can provide your company with potential cost savings on future relocations.
  • Good option for employees who relocate often, thereby your company can forego paying closing and future home sale costs on a repetitive basis for the same employee.

IV. Household Goods (HHG)

The HHG move is one of the most stressful stages of a relocation.

• Make sure your RMC is proactive in their communications and provides opportunities for the transferee to give live feedback so that problems can be addressed immediately.
• Most companies will provide tax assistance with HHG moves, especially since the Tax Cuts and Jobs Act (TCJA) of 2018 was passed.

Vehicle Shipment

Create cost savings by basing the number of vehicles authorized on move distance. It is common for companies to offer at least one vehicle to be shipped if the distance will be over 500 miles, and up to two if the distance is over 1000 miles. This reduces the stress of requiring the employee and family to travel long distances in separate vehicles.

Temporary Storage

Most companies will provide temporary storage of the employee’s household goods until permanent housing is secured.

• To save costs, do not provide this benefit for personal reasons, e.g., during home remodeling, when the employee may want to store items until the work is complete, or if the employee is going on vacation and cannot be present for HHG delivery.

V. Lump Sum

Decide if you want to offer a partial or full lump sum policy to transferees. Some employees may enjoy the freedom of being able to use their relocation money as they see fit. Pros for providing lump sums include the following:

• Cost containment.
• Easy budgeting and administration.
• Market competitiveness.
• Great for employees with less to move.
• Internship programs.

There are three main types of lump sums discussed below: lump sum only (no counseling); managed lump sum (with counseling); and lump sum (in addition to other benefits).

A. Lump Sum Only Benefit (no counseling)

The transferee receives one lump sum payment. The employee decides how they plan to spend these funds.

• Commonly used with non-executives including entry-level hires and employees in development programs who rotate locations frequently.
• Typically, not utilized with higher-level relocations.
• Majority of lump sums are less than $5K

B. Managed Lump Sum (with counseling)

Allows your company to retain partial control over how the employee uses the money while still allowing some flexibility. The RMC counsels the employee on approved ways they can use their managed lump sum, and the funds are provided as a reimbursement after the employee incurs the cost or is direct billed to one of your RMC’s supplier partners.

• Managed lump sums are used more often as the only benefit to executives or higher-level employees versus a lump sum only (no counseling), used more often with entry-level employees.

C. Lump Sum (in addition other benefits)

This is the most frequently used type of lump sum benefit. It works well because companies can provide other benefits – tailored to the individual’s specific relocation needs – while still providing a lump sum that the employee can spend as they wish.

• This type of benefit will also allow your company to control costs and it adds some additional flexibility for the employee.

VI. Cost of Living Assistance (COLA)

Some of your employees may be moving to an area with a lower cost of living and some may be moving to a much higher cost destination. If higher costs exist, some companies will provide a limited term cost of living allowance to bridge the financial gap. Options for payout could include monthly, quarterly, annually or a one-time lump sum.

• Set an ending time-period for this benefit and decide whether the benefit will slowly decrease/taper during that time-period.
• It is best to only offer this benefit to those employees moving to higher cost destinations. If your employee is moving from one high cost of living area to another, consider withholding this benefit. Often employers will establish a threshold (typically a percentage), to offer the benefit. Others will identify specific areas/cities and only offer the benefit to employees moving to these pre-determined locations.

VII. Policy Exceptions

Decide how you want to handle policy exceptions and make sure you and your RMC are in sync. Even though you may have a great employee relocation policy, it’s not always one-size-fits-all! Individual cultures, specific needs and family dynamics may create the need for exceptions. Make sure your RMC is tracking all requests/outcomes. This information will help you determine where policy changes are needed.

Some common policy exception requests might include the following:

• Additional temporary housing or household goods storage.
• Additional crating of items, vehicles to be shipped or other services for a household goods move.
• Home listing parameters.
• Qualifying home requirements.
• Additional reimbursements for travel.
• Repair Requirements.
• Benefit extensions.

VIII. Policy Tiers vs Core Flex Benefits

With policy tiers, the company selects which employees receive specific benefit packages. Often, policy tiers are based on an employee’s role at the company. For example, relocation benefits provided to an executive might be different than benefits provided to an entry-level employee. While a tiered policy allows a company to be selective regarding which benefits are offered to each level of employee, some benefits may be offered in all packages. In other words, a HHG move could be offered to all relocating employees, but the cost of the move could have caps for lower-level employees. Some companies will only offer home sale assistance to higher level employees, but all other benefits may be the same regardless of role/job level of the employee.

In addition to employee position level, other factors that could affect which tier an employee fits into might include whether they are a homeowner versus renter, or a new hire versus an existing employee.

Core Flex benefits include a grouping of benefits that everyone receives, but the employee is also offered other possible benefits that they can pick from, sometimes based on their job title.

In Conclusion

Whatever policy decisions you make, consider partnering with a good RMC who can help write your policy and administer it cost-effectively. For more best practices, get our 2020 Benchmark Survey.

We firmly believe that for an organization to be successful in today’s world, you have to have the right people doing the right things in the right location. That said, the decision to relocate an employee is not to be taken lightly – it’s a major commitment for both the organization and the employee who’s moving. If done poorly, you risk more than the money spent on relocating – your organization can suffer a severe reputational and talent hit as well.

That’s why it’s essential that your relocation program is carried out by caring professionals who are committed to creating a great experience for your organization and its employees. We’d like to share with you what our relocation process is like, both before the move and after employee settles into their new location.

Before the Move

The relocation experience begins once you authorize an employee for a relocation. Within 24-hours, your employee’s dedicated WHR Group counselor will reach out to introduce themselves as the main point of contact and schedule a time for an initial phone call. At this point, we find most employees are somewhere between excited and apprehensive ¬– they typically understand that this move is good for their career, but they might have concerns about leaving their familiar environment for their new life somewhere else.

Our counselors are looking to accomplish three goals during this initial outreach: to conduct an initial needs assessment (Are we moving a car? A pet? A piano?), to level-set expectations as to what is and isn’t covered in the relocation package, and most importantly to reassure your employee that their move is in good hands. Our counselors will also go over the benefits included in your relocation program, which could include:

• Homesale assistance or breaking a lease
• The physical moving of household goods, be it domestically or internationally
• Destination services such as home purchase assistance, temporary housing, and language training
• A cost of living adjustment
• Expense reimbursement or tax assistance

During the Move

The transition itself is often when stakes are the highest – and not just for the relocating employee. There’s a lot to arrange that require third-party vendors (like real estate agents and moving companies) and timing is paramount. Fair or not, your employees and their families will evaluate your company on how well their physical move is managed. This is a perfect opportunity for you to show how much your employees welfare means to you. Being able to quickly adapt with empathy around logistics like what happens when the move is scheduled during inclement weather can make the difference between your employees feeling like their experience is being handled competently…or like they’ve been left out of the loop and in the lurch.

We appreciate how critical it is that the move be handled with care, efficiency, and compassion. That’s why we make sure your employees and your company have online access to all the information you need to stay on top of the move. We also have two-person teams serving as your employees’ advocates: setting appointments, confirming status updates, ready at all times to step in at the slightest indication of a concern.

And all throughout the move, the relocating employee can rest easy, secure that their moving needs are being expertly tended to.

After the Move

Even after the relocation is complete and your employee has moved into their new environment, they may still have lingering concerns. Our counselors continue to work with them well after the transition to make sure they are completely satisfied with the entire relocation process. Questions at this stage might include:

• How to submit receipts for expenses incurred during the move
• Which expenses are covered under the company’s relocation program
• What are the tax implications of certain relocation-related expenses

Our founding values statement reads: “We value hard work, empathy, proactiveness, and trustworthiness in everything we do and from everyone we employ.” We believe the only way to create a great relocation experience for your company and its associates is to be proactive and to really commit to the best interests of the relocating employee. And that can only be accomplished by forging a genuine relationship between the counselor and employee.

Does this relocation process sound like the one your company offers? We invite you to benchmark your current relocation program against those of your competitors using our free Relocation Benchmark Comparison tool. Check it out and see where you stand!