Relocation policy design and review

To ensure that they have the right people in the right place at the right time, organisations that move individuals or groups of employees need to address how to provide cost-effective yet motivating benefits packages.

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See more features about the Global Mobility Industry in the Autumn 2016 issue of Relocate magazine on our Digital Issues page.


Relocation policy design is a crucial aspect of the mobility and HR functions. If the organisation has no relocation policy currently, or if the policy that is in place no longer enables the attraction, deployment and retention of key personnel, then it is essential to introduce or redesign organisational policy to ensure that individuals and their families can be moved effectively. Companies may also need to review their policy to address a number of other pertinent issues. These include, for example: to respond to organisational change such as mergers and acquisitions and the introduction of joint ventures; to address cost savings and compliance issues; and to support the development of talent locally, regionally or globally.It is important to ensure that policies – whether they are designed afresh or reviewed – reflect the motivations that individuals express for moving and, balanced against this, organisational requirements.Every organisation is different, having its own challenges and its own culture. Because of this, there can be no single solution or ‘magic answer’ in policy design. That said, a number of basic principles underpin relocation policy design and implementation and are worthy of note.

Strategy, culture and structure

The first policy design or review step typically involves gaining a detailed understanding of the organisation's strategy, culture and structure and its key drivers for relocating employees. For example, the organisation may be planning a group move when an operation is to be closed or scaled down in one location and the existing employees moved to a different part of the same country or abroad.The company may be in a period of expansion, acquiring other businesses domestically or internationally. It may be setting up operations in new environments or places where it already has existing units. New projects are also a common driver of mobility.Besides requiring a policy to address organisational activities, mobility policy design and review may also be required to meet the needs of individual employee relocations. Typically, employers need to ensure that skills gaps are filled, that projects are staffed and managed effectively, and that talent development initiatives provide exposure to different environments in order to build up the competencies of staff.International assignments develop a global mindset, and they are increasingly expected by the younger generation, who see their future careers linked to international experiences.How policies are designed and implemented should reflect the organisation’s particular cultural backdrop and structure. It is also important that the mobility policy dovetails with HR strategy and other HR policies that are aligned with it.In relation to cultural fit, the policy design should reflect factors such as: organisational decentralisation; planned expansion or reduction; predicted mobility volumes and roles; employee and family profiles; and potential and actual locations of operation, taking into account challenging destinations.Benchmarking is helpful to find out how other comparable organisations manage their mobility issues, and useful lessons can be drawn from this. However, it is likely that every organisation will require its own bespoke solution in terms of policy design – though this may draw upon ideas and actions used by peers in the field.

The role of stakeholders

In developing a new policy or revising an existing one, mobility professionals must consult with relevant organisational stakeholders, as it is critical to obtain their buy-in if the policy implementation is to be successful. It is important to consult senior management first of all, in order to understand the strategic direction of the organisation and to gain awareness of any potential change that might affect mobility. It is also crucial to speak with existing and/or potential transferees or assignees, to understand their perspectives and what motivates them to move.Other stakeholders in the business who should be consulted include specialist services like payroll, tax, legal and HR personnel. External parties, such as relocation consultancies and data providers, can also prove to be useful sources of information.

Policy segmentation

It is becoming increasingly common practice for policy design to be segmented. For example, it is likely that the assignment policy that applies to a skills-transfer full-length expatriate assignment will differ from that offered to an international assignee undertaking a short-term or commuter assignment. Self-initiated movers and graduate trainees can also receive different policy elements. Assignees being transferred permanently to a new location abroad and/or being moved to a new location in their home country also require attention in policy. 
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The traditional model used for relocating staff internationally on a long-term assignment is the balance sheet, but host-based pay is increasingly being applied as an alternative. The latter is a more cost-effective approach, but policy designers need to take care, because this type of policy can hinder mobility if no account is taken of the gains that assignees and their families can experience when moving to higher-net-pay locations.The balance sheet is usually considered to be a costly method of remunerating assignees, but its design is such that assignees are theoretically no better or worse off, and the quid pro quo is the facilitation of international mobility.This provides just one example of why mobility professionals involved in policy design need to consider all the implications of the design choice. Cost savings may be an important driver of policy review, but it is important to ensure that, by achieving this objective, mobility does not become compromised.Another driver of policy review can be the need to simplify administration and improve the clarity of the benefits available to those relocating. Again, care needs to be taken.

Lump sums

For instance, lump-sum approaches are popular. They are simple in design and relatively easy to implement. Employees and their families are able to spend the money given to them in the manner that suits them best. However, the organisation does have a duty of care, and employees may not fully protect themselves in their spending decisions. If assignees are left to decide how best to spend their lump sum and they decide to spend it on furnishings, rather than healthcare provision in a remote or difficult location abroad, they may leave themselves and their organisations vulnerable in a medical emergency (see health feature in the Autumn 2016 issue, p46). This means that policy design should set out a number of core benefits that apply to all transfers, with specialised benefits and services applicable to different segments of the mobile population.Certain benefit elements, such as cultural, language and security training, are particularly helpful in terms of integrating assignees and their families into their new environment abroad (see language learning feature in the Autumn 2016 issue, p18). Again, this is an area that, if not prescribed by the company, may not be taken up by the assignees and families, resulting in assignment dissatisfaction, loss of productivity and, potentially, early return (with consequent cost implications).

Gaining approval and buy-in, and launching the policy

After consulting relevant parties and writing (or rewriting) the proposed policy, it is important to gain approval for it and ensure buy-in from senior management and the specialist in-house and external stakeholders, as well as the end users.Before launching the policy, it is important to set context for it by highlighting the drivers for its introduction or review alongside the benefits that the policy will bring to the organisation and the individuals affected by it. It is also important to provide, as far as is possible, a cost–benefit analysis, or at least to demonstrate how the success of this initiative will be measured.A consultation process is advisable, to take on board feedback received and ensure that the approval is in place for the launch. It is unlikely that any policy design will be right first time, so it is important to be prepared for rewriting and amending, adding and subtracting elements, and even rethinking sections of the policy. At this point, the fine tuning could well reveal the need to incorporate more detail and depth, or, if the policy is viewed as being too prescriptive, to generalise sections so that they become more applicable in practice.A delicate balancing act will be needed, as the policy has to be fit for purpose but not be so general as to lead to innumerable exceptions further down the line.

Communication is key

When the policy is ready to be launched, it is important to ensure that all parties who will be involved with it receive the details and understand them. For example, any service providers who are involved in implementing policy, as well as internal stakeholders involved in the relocation process, such as payroll and legal teams, need to be informed of any changes.If the policy relates to international mobility, it is critical to inform the host operation’s HR and line managers who are to receive the international assignees and their families of any policy changes, so that they can implement the policy correctly. It is also important to spell out how any policy revisions will be addressed for existing staff who are currently subject to a previous policy (whether existing transferees are moved across to the new policy and, if so, if this is carried out in a phased manner or not).Good communication is critical to success. An explanatory document or a presentation may go some way towards explaining the changes, but it is more likely that discussion will be needed to ensure full understanding. Webinars and online chats may prove useful in communications, particularly if operations are spread widely across the globe. Relocating individuals must receive up-to-date letters and contracts as necessary. It is good practice to ensure policy transparency such that the policy is freely available, for example on the organisation’s intranet.To ensure that all those affected by policy changes are notified, it is helpful to keep an up-to-date database. A communications plan and an implementation timeline are also likely to prove valuable. If the policy relates to a group move, whether this be domestic or international, it is important that the timing of the communication is consistent such that all those affected are notified at the same time, to ensure a clear communication path that minimises rumour and dissent.

Feedback and evaluation

The notion of ‘plan, do, review’ applies to relocation policy design. Evaluation of the policy in action, and tailoring of issues to improve their effectiveness, are critical to ensure that the policy remains effective and up-to-date.The benefits of the policy, as previously articulated in gaining buy-in to its design or review, need to be assessed in practice. Has the policy achieved what it set out to facilitate? Is it cost-effective?To find out, mobility professionals need to ensure that they capture and respond to feedback, and that they take steps to measure (in any appropriate way that fits with the organisation’s structure, culture and strategic direction) the return on investment in employee mobility. Policy design is not a single, one-off event but a continual process-review exercise that aims to enhance employee and organisational effectiveness in the long term.Hence, it is important to remember that, in going forward, the policy is not a static document and, while continual alterations are not ideal, it will be necessary to monitor each aspect of policy content and ensure that it meets organisational and employee needs, and responds to change.An ongoing monitoring process can operate via data collection, with feedback and measurements of return on investment collated to form part of a future review exercise. A process map that addresses the relocation journey can prove particularly helpful in identifying blockages or bottlenecks where policy redesign could make a significant improvement to mobility in the future.

For more news and features about Global Mobility, visit our Mobility Industry section.

The following sections may also be of interest: International Assignments, Talent Management


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