A Look at Typical Relocation Packages
Relocation packages, also known as relocation benefits, are policies and support that companies offer employees transferring to a location for a position. Each company will have different needs when it comes to relocation benefits, and it can be challenging for companies to determine exactly what should be covered in these policies and what employees should be responsible for on their own.
To ensure the selected applicant receives a strong and appealing offer, providing a comprehensive and competitive relocation package for relocating employees is highly advisable. When crafting a relocation package, companies typically consider several key components to make the transition as smooth as possible for their employees.
By offering a well-rounded relocation package, companies ease the transition for their employees and demonstrate their commitment to supporting their workforce. This can lead to increased employee satisfaction, decreased turnover, and a more positive company culture. As businesses continue to adapt to a global workforce, investing in comprehensive relocation benefits will remain a crucial strategy for attracting and retaining top talent.
Companies can typically tailor relocation programs to each hiring situation. Some companies choose to have their HR department handle employee transfers. Still, if the company wants to be consistent with its relocation packages on each hire, using a reliable relocation management company is probably a good idea.
What Does A Standard Relocation Package Include?
Most relocation policies outline some form of reimbursement or coverage for many of the everyday expenses associated with moving. Relocation benefits often include full packing and unpacking services and a quality and reliable moving company to get the employee’s household goods from point A to point B.
In addition to moving expenses, home sale assistance is another common benefit offered to transferees. This can include selling programs that utilize vetted real estate agents specializing in relocation to help ensure a quicker and more prosperous home sale for the relocating employee.
Specific policies might support employees who need to terminate their rental agreements prematurely, helping them manage any associated penalties. Additionally, the relocation package may encompass house-hunting trips. This implies that the employer could finance one or two visits for the relocating employee to explore their future neighborhood and inspect various houses or apartments before making a decision.
Corporate housing options, also known as temporary housing, are typically included in most relocation policies. This provides the employee with a temporary accommodation after they’ve relocated to find a permanent home in their new location, allowing them to start on their desired start date for the position without delay.
Many companies also offer transportation coverage or reimbursement as part of their relocation packages. This might cover airfare for the employee and their family or expenses for driving across state lines. In some instances, companies may also cover the employee’s transportation costs for their vehicle.
What Expenses Are Typically Covered During Relocation?
While not an exhaustive list, the following are common relocation costs for which many companies provide support to their relocating employees:
- Corporate housing options
- Household goods transportation (HHG)
- Storage facility (temporary storage of the HHG shipment
- Miscellaneous expense allowance
- Home sale costs
- Spousal employment assistance
- Travel-related costs, such as airfare, meals, and hotel nights
As every company has different goals and objectives for its relocation program, many-tiered relocation policies offer various levels of support for each employee.
Here is a breakdown of the most common U.S. domestic relocation policy tiers per GMS research:

What Types Of Employees Receive Relocation Packages?
This aspect will depend upon the company’s need for each position and the importance of getting that employee to the new location. The best practice for relocation programs is to build a tiered system based on employee level.
These tiers are commonly built around entry-level employees, professionals, directors, and vice presidents. Additionally, many companies offer executive relocation packages to cover the costs of relocation for most executive-level employees. Some companies may also provide international relocation packages for employees relocating globally.
Common Methods to Address Costs in Relocation Packages
Different policy tiers within your relocation program may require different strategies for covering your employee’s relocation costs. It is essential to understand the advantages and disadvantages of these standard methods.
Direct Billing: The relocation management company manages the procurement, organization, and direct payment to the service providers involved in your employee’s relocation. They review, combine, and forward the invoices to you for settlement. Although this approach may be pricier, it guarantees that your employee maximizes their benefits and reaches their new location promptly, alleviating any concerns about the expenses associated with the move.
Expense Reimbursement: The employee pays for moving expenses upfront, and the company issues a reimbursement check at the end of the process. While not generally intended to cover an employee’s entire move (few families have the cash to pay tens of thousands of dollars for a move), reimbursements are commonly used for miscellaneous expenses as outlined in the company’s relocation policy. Typically, reimbursements are used for items such as travel costs or other related items.
Lump Sum: Unlike an expense reimbursement, a lump sum is commonly used as the primary financial benefit to a relocating employee. In a lump sum policy, a set amount of money is given upfront to the employee to handle the moving expenses as they see fit.
Generally provided to entry-level or lower-level employees, the lump sum is typically the only relocation benefit offered. While the lump sum is seen as an excellent cost control tool for companies, it places additional burdens on employees, as they are left to manage their move independently. This is in addition to the lump sum, which is typically considered taxable income. Employees who receive their relocation benefits as a lump sum should note the payment for tax purposes. Employers should consider adding a tax gross-up to the lump sum to help mitigate the effects of the income tax on the employee’s benefit.
Ready to Set Up Relocation Packages for Employees?
Partnering with Global Mobility Solutions (GMS) ensures that your company offers comprehensive, cost-effective, and employee-centric relocation packages. GMS provides a tailored approach that aligns with your unique organizational needs, offering flexibility. This model allows you to select from a network of top-tier service providers or integrate your preferred partners, ensuring a customized experience for each relocation. Their expertise in managing all aspects of the relocation process—from pre-decision assessments to destination services—reduces risks, enhances employee satisfaction, and improves retention rates.
By leveraging GMS’s industry-leading MyRelocation® technology platform, your company can streamline relocation management, track expenses, and provide real-time support to transferees. This comprehensive support facilitates smoother transitions for employees and strengthens your employer brand by demonstrating a commitment to employee well-being. With over 30 years of experience and a global presence in over 140 countries, GMS has an expert team equipped to handle the complexities of workforce mobility, enabling your company to attract and retain top talent anywhere in the world.
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