Category: Relocation Policy Review

Remote Worker Expenses: What is the Expectation?

Post author By Sam Hoey | CRP, GMS
Post date December 1, 2020

young smiling woman working on laptop — Shot of a young businesswoman using a laptop while working in her home office

Employers and employees are grappling with the quandary of how to handle remote worker expenses. Simply put, there are many questions that remain outstanding relating to “who” is going to pay for “what.” With the world continuing to respond to the COVID-19 pandemic, the work from anywhere movement is further clouding some of these expense issues. As a result, understanding the issue is vitally important. Clear communication is critical to ensure the employer/employee relationship remains positive and supportive.

In some cases, the cost of telecommuting is simple to compute. An employee who lives within a few miles of a workplace might need to purchase some equipment to create a functional office in their home. While this sounds reasonable, there are other indirect expenses that may accompany creation of a home workspace. Often neither the employer nor the employee realize these indirect expenses until after they arise.

What are Remote Worker Expenses?

Compiling a list of remote worker expenses may sound like an easy task. And in reality, looking at the direct expenses is easy. These are the immediate out-of-pocket expenses involved in creating a workplace in the home.

Direct Expenses May Include:

Voice Communication: cell phone or direct line
Computer laptop, desktop, or tablet, with cords and monitors, mouses and mousepads
Computer software and licenses including security setups
Office supplies such as paper, pens, and folders

What about the indirect expenses? These are the expenses that accumulate behind the scenes, often relating to the direct expenses. However, they are often not recognized as remote worker expenses.

Indirect Expenses May Include:

Electricity to run computer equipment
Internet access and use
Noise cancelling headphones
Cell phone or direct line charges relating to increased work use
Lighting for the home workspace
Masks and safety equipment
Heating and cooling of the home workspace during normal working hours
Furniture used as office equipment on behalf of the employer

It is not always clear that companies have an obligation to pay for direct or indirect remote worker expenses. Some states require reimbursement for business expenses, while others do not. Employers should understand their obligations with respect to paying for remote worker expenses. However, they should also consider issues of fairness and equity for workers in these situations.

Work from Anywhere Policies may Impact Remote Worker Expenses

Beyond expenses relating to a home workspace, there are other considerations for remote worker expenses. Many companies now allow their employees to work from anywhere. As a result, some employees have moved from very expensive areas such as San Francisco, California to less expensive areas such as Missoula, Montana.

According to Salary.com, it costs 92.2% more to live in San Francisco than in Missoula. What is the issue for employers? Companies need to examine whether pay should be adjusted for remote workers who move from expensive cities to less expensive cities. Such worker pay adjustments would be subject to several complex issues. Pay varies by geography not just because of the cost of living, but by other factors including supply, demand, and productivity.

Thoughtful Consideration on Remote Worker Expenses is Important

It is easy to see how the issue of remote worker expenses may require employers to pursue some thoughtful consideration. While a few remote workers may save on costs relating to commuting or wardrobe, not all share the same level of savings. The cost burden of working from a home workspace is not always equal from one employee to the next. Fairness and equity should be top of mind for any company when looking at these issues.

It is also important for companies to examine their compensation policies. Changes may be in line for employees working from home workspaces, as well as for employees that move to lower-cost locations.

What Should Companies do?

Companies should work with a Relocation Management Company (RMC) that has knowledge and experience in managing relocation and group moves. Qualified RMCs will help companies understand the issues and gain access to useful resources to guide policy decisions and follow industry best practices.

Companies should understand how to address issues relating to remote worker expenses. The transition from working in an office to working from a home workspace is similar to arranging for a corporate group move. There may be some expenses that the company chooses to reimburse. The GMS expense management program provides a quick and easy reimbursement process for employees, wherever they are located.

Conclusion

GMS’ team of corporate relocation experts has helped thousands of our clients with their relocation programs and group moves. As a result, our team can help your company understand the issues relating to remote worker expenses. We can also help your company consider the impact of work from anywhere policies on compensation issues.

GMS was the first relocation company to register as a “.com.” The company also created the first online interactive tools and calculators, and revolutionized the entire relocation industry. GMS continues to set the industry pace as the pioneer in innovation and technology solutions with its proprietary MyRelocation^® technology platform.

New SafeRelo™ COVID-19 Knowledge Portal

GMS recently launched its new SafeRelo™ COVID-19 Knowledge Portal featuring a number of helpful resources including:

Curated selection of news and articles specific to managing relocation programs and issues relating to COVID-19
Comprehensive guide to national, international, and local online sources for current data
Program/Policy Evaluation (PPE) Tool for instant relocation policy reviews

Contact our experts online to learn more about how your company might address the issue of remote worker expenses, or give us a call at 800.617.1904 or 480.922.0700 today.

GMS is sharing public knowledge and can help companies more clearly understand how to address remote worker expenses. However, GMS is not a CPA firm, and is not giving financial advice. Everyone’s financial situation is different; individuals and employers should consult their financial advisors prior to making any decisions.

We're Here to Help! Request a Courtesy Consultation

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Tags COVID-19, COVID-19 Travel Recommendations, Domestic Relocation, Domestic Relocation Tips, Domestic Relocation Trends, Move During COVID, Move During COVID-19, policy review, relocation expense management, Relocation Expense Reporting, relocation expenses, Relocation Policy Review, relocation technology, Remote Worker Expenses, Top 5 COVID-19 Risks

Corporate Relocation Corporate relocation tips Domestic Relocation Domestic Relocation Tips Global Relocation Global Relocation Tips Relocation Best Practices Relocation Management Relocation Policy Review Relocation Programs

Expedited Bidding Benefits: How Your Company Can Gain Immediate Results

Post author By Nancy Kritzer | CRP
Post date November 23, 2020

Two male and two female Relocation Management Company representatives presenting their proposal by video to a male Human Resource Professional who hopes to gain expedited bidding benefits

If your company is seeking better results from your relocation program, expedited bidding benefits bring immediate savings. As many companies learn, outsourcing the management of their relocation program to a Relocation Management Company (RMC) provides several advantages. Doing so through a quick process helps the company achieve even greater results in the short term. Companies that use an expedited bidding process report significant savings in both time and costs.

GMS’ benchmark study of companies that leverage an expedited approach to bidding on the management of their relocation program show why this is a preferred process. Our team of global relocation experts has identified the top five expedited bidding benefits that companies can expect.

Top 5 Expedited Bidding Benefits

1. Cost Savings Right from the Start

Companies instituting an expedited approach create competition in the process. Relocation Management Companies pursuing their business will put forth their most competitive fee structures. Direct costs are likely to be the lowest in the quest to obtain the account. With these immediate savings from the expedited bidding process, companies are assured of cost effective solutions.

2. Complimentary Consulting

Some of the most valuable expedited bidding benefits related to mobility consulting. As part of the process, companies can request many of the following at no cost:

Policy development and revisions
Relocation program design
Current policy reviews

As part of this process, companies can learn much about an RMC’s abilities, including:

Knowledge of relocation processes
Level of experience on points important to the company
Consulting work quality and timeliness

3. Speedy Implementation Saves Time and Offers Quick Access to Expedited Bidding Benefits

Expedited bidding benefits relating to time savings can directly correlate to cost savings. The quicker a relocation program be implemented, the quicker the company achieves program savings and efficiencies. GMS’ data shows that on average, more than 90% of companies using expedited bidding complete their relocation program implementation in just 22 days. Given the amount of work that may be involved, including creating relocation APIs, policy documents, and communication, a shorter implementation timeframe lets the company quickly return its focus to other strategic objectives.

4. Process is a Better Fit for Buying Solutions

Companies that retain an RMC to manage its relocation program understand they are buying solutions that will help their employees. As a result, these solutions require a much different approach than the process they would use to purchase equipment parts or to source machinery. Ultimately, relocation management requires that the company ensures the right fit for the right reasons. The right fit ensures the company will maximize their expedited bidding benefits.

5. Frees up Administrative Burden of Formal Requests

Companies that fully understand their purchasing processes know the amount of administrative burdens and resources necessary to complete formal Requests for Information and/or Proposals. By foregoing these types of resource-intensive approaches that often create more problems for the company, employees can pursue value-added activities while RMCs carry the burden of responses.

What Should Companies do to Gain Expedited Bidding Benefits?

Companies should seek to gain expedited bidding benefits by utilizing an expedited process for outsourcing the management of their relocation program. Relocation Management Companies with extensive industry experience and knowledge will prove to be the best resources in this effort. Qualified RMCs will guide companies to successful results with a customized, right-fit program and greater expedited bidding benefits.

Conclusion

GMS’ team of corporate relocation experts has helped thousands of our clients with their relocation programs. Our team can help your company gain the maximum amount of expedited bidding benefits by leveraging our expertise to present the most cost-effective and efficient relocation management solutions.

New SafeRelo™ COVID-19 Knowledge Portal

GMS recently launched its new SafeRelo™ COVID-19 Knowledge Portal featuring a number of helpful resources including:

Curated selection of news and articles specific to managing relocation programs and issues relating to COVID-19
Comprehensive guide to national, international, and local online sources for current data
Program/Policy Evaluation (PPE) Tool for instant relocation policy reviews

Contact our experts online to discuss your company’s interest in obtaining expedited bidding benefits, or give us a call at 800.617.1904 or 480.922.0700 today.

We're Here to Help! Request a Courtesy Consultation

Tags corporate mobility, corporate relocation, Domestic Relocation, Domestic Relocation Tips, Expedited Bidding, Expedited Bidding Benefits, expeditied bidding, global relocation, Global Relocation Tips, Relocation Benchmarking, relocation policies, Relocation Policy Benchmarking, Relocation Policy Review, relocation programs

Corporate Relocation Domestic Relocation Global Relocation Global Relocation Challenges Relocation Best Practices Relocation Management Relocation Policy Review Relocation Programs Talent Mobility

2020-21 Corporate Relocation Budget: Start Planning Now

Post author By Sam Hoey | CRP, GMS
Post date September 1, 2020

Young woman collecting important documents — Shot of an attractive young businesswoman going through paperwork while sitting with her laptop

It is not too early to start thinking about your company’s 2020-21 corporate relocation budget. Many companies start reviewing budgets on a regular timeframe. However, the year 2020 has been anything but regular. Every nation in the world has been dealing with the impact of the COVID-19 pandemic. From border restrictions to stay-at-home orders, the vast majority of companies have been facing multiple disruptions.

As a result, these disruptions are bound to have some type of impact on corporate budgets. Companies will find it difficult to determine the “new normal” in their business and industry.

Issues That May Lead to 2020-21 Corporate Relocation Budget Increases

Business Growth

Some companies have seen increasing demand for their products and services. For example, Amazon’s recent second-quarter report earnings call indicates tremendous growth for the company:

Earnings per Share: $10.30 (average analyst’s estimate: $1.46)
Revenue: $88.9 billion (average analyst’s estimate: $81.56 billion)
Sales: up 40% year over year in the quarter
Drivers: online retail, cloud services

Of special note is Amazon’s online grocery and delivery services, with significant progress in this area.

New Corporate Expansions

Other companies are planning significant expansions. Nikola Motor Company announced it will break ground on a manufacturing plant in Coolidge, Arizona. The plant should create thousands of jobs within Pinal County. Nikola expects to produce up to 35,000 hydrogen electric and electric semi-trucks.

Not to be outdone, Tesla recently announced it will build its next factory in Austin, Texas. Known as a Terafactory, the next Tesla Gigafactory will make the Tesla Cybertruck electric pickup truck and the Model Y. Additionally, Tesla’s headquarters location may also soon relocate to Austin.

Issues That May Lead to 2020-21 Corporate Relocation Budget Changes

Immigration Limitations

Beyond business growth and new corporate expansions, other issues may lead to budget changes. Limits on immigration may decrease a company’s ability to hire foreign nationals to work inside the United States. However, alternatives may still allow companies to hire qualified staff. These alternatives require specific conditions, with possible increases in costs in some areas such as travel and facilities.

Need for Highly Qualified Staff

Other issues could include staffing requirements. Some industries such as healthcare have seen a dramatic rise in the need for corporate housing solutions. This is due in part to a dramatic increase in a truly mobile workforce to deal with effects of the COVID-19 pandemic.

How Should a Company Approach Reviewing its 2020-21 Corporate Relocation Budget?

Every company looking to review its 2020-21 corporate relocation budget should consider the following 5 specific points:

1. Relocation Policy Review

It is imperative that companies undertake a review of their relocation policy. Best practice is to review this policy every 12 to 18 months. With changes impacting nearly every component of a company’s 2020-21 corporate relocation budget, a policy review will help define areas that should be examined for compliance, utilization, and cost savings.

Do you know if your company’s business continuity plan includes points related to its relocation program? A relocation policy review will highlight areas that should be considered, such as employees on temporary assignment who may need to be quickly reassigned to a different location.

2. Historical Data Review

A thorough review of expenses will provide a good indicator of areas in need of attention. That being said, it is now critically important to also factor in multiple forces that may impact the future budget, including:

Immigration issues
Travel restrictions
Costs to comply with COVID-19 sanitation guidelines
Virtual talent acquisition
Virtual office requirements
Tax compliance issues

A number of points specific to each company’s needs can be considered in light of new business operating guidelines.

3. Significant Cost Generators

Many costs in relocation budgets are due to significant cost generators. Often these costs are driven by specific activities such as moving an employee to a new destination, or reimbursing temporary housing costs during a short term assignment. A thorough review should include examining these activities in detail as they impact the relocation budget:

Home Sales
Home Purchases
Temporary Housing Costs
Tax Obligations
Household Goods Moves

Be sure to compare and account for cost differences between global relocations and domestic relocations.

4. Accounting Accruals

Companies often account for business expenses that occur in one period by setting aside amounts known as accruals. Future expenses are then allocated toward the accrual amount. Reviewing your 2020-21 corporate relocation budget, consider those expenses that might be better accounted for through accruals.

A good practice is to review the prior year’s accruals to determine if similar amounts should be in the budget through accrual accounting methods. This will also help ensure a smoother expense tracking and recording process. It may also assist the company with cash management requirements.

5. 2020-21 Corporate Relocation Budget Strategic Initiatives

Consider the impact of any strategic initiatives that might result in additional employee relocations, new hires, or corporate expansions. Is the company planning to build a new manufacturing facility or open a sales office? Are there discussions of future partnerships with other firms? Are new talent management programs in development?

With the advent of COVID-19, today’s workforce is even more responsive to changing company requirements. Given the swift nature of how companies responded to the pandemic, be sure to plan for future contingencies, changes, and disruptions.

What Should Employers do for Their 2020-21 Corporate Relocation Budget?

Employers should work with a Relocation Management Company (RMC) that has knowledge and experience with relocation budgets and managing for contingencies. RMCs are ideal sources for industry best practices. RMCs also have valuable knowledge on global issues relating to immigration, travel, and how the relocation industry and service providers are changing to meet new requirements due to the COVID-19 pandemic.

Conclusion

GMS’ team of global relocation experts has helped thousands of our clients understand how to develop and prepare robust relocation programs that follow industry best practices. Our team can help your company understand how to account for each of these 5 specific points during the review of its 2020-21 corporate relocation budget.

Contact our experts online to request a relocation policy review as part of your 2020-21 corporate relocation budget review process, or give us a call at 800.617.1904 or 480.922.0700 today.

We're Here to Help! Request a Courtesy Consultation

Relocation Best Practices Relocation Management Relocation Policy Review Relocation Programs Relocation Technology

Centralization Advantages: What You Should Know

Post author By John Fernandez | CRP, GMS, SSB
Post date February 10, 2020

Companies benchmarking their relocation policies often learn about many centralization advantages that can be obtained by moving away from a decentralized business model for their relocation program. Often a company’s decentralized relocation program develops over time through business mergers and acquisitions. Challenges come to light when a transferee from one location moves to a new location that has different relocation policies.

What are the Challenges of Decentralization?

There are many challenges for companies that follow a decentralized business model for their relocation program. Reporting systems are often inconsistent. Therefore, it is difficult to obtain accurate information on the full scope of the relocation program. Costs are often excessive due to a high number of policy exceptions, use of multiple vendors for the same processes, and in-house costs related to maintaining multiple relocation programs. Since business units, HR teams, and other departments operate independently, lack of ownership hampers progress.

Impact on Employees

These challenges impact the satisfaction of new hires and transferees who are subject to decentralized relocation programs. There may be confusion for employees with currencies, visas and documentation, and reporting requirements. Ultimately, these challenges may reflect back on the company’s reputation among job seekers and other employees approached for relocation opportunities.

What are the Centralization Advantages for Relocation Programs?

Companies that develop a centralized business model for their relocation program gain in many ways. These centralization advantages cover all aspects of relocation, and include:

Consistency in operating platforms with robust integration options
Cost containment to reduce variation and increase forecasting and predictability
Customized billing processes that meet the company’s needs
Defined ownership across local, regional, and global entities
Global access to courtesy mobility consulting 24/7/365
Greater discounts across a streamlined network of vendors along with dual bid savings
Reporting capabilities across multiple platforms, anytime, anywhere

What Should Companies do to Obtain Centralization Advantages?

Companies should work with a qualified Relocation Management Company (RMC) that has extensive experience in helping companies obtain centralization advantages for relocation programs. GMS has published a Case Study on Decentralization that describes how a client was able to obtain centralization advantages that led to significant cost savings and greater employee satisfaction.

Companies should ask their RMC a wide range of critical questions to address all of their main concerns. The RMC will help them understand how to obtain centralization advantages for their relocation program. Also, the RMC will help them design their relocation program. As a result, this will help gain the most benefits for the company, new hires, and transferees.

Industry Benchmarking Studies Highlight Centralization Advantages

GMS has also recently published several Industry Benchmarking Studies that will help companies learn whether their relocation program is designed following industry-specific best practices. There are many benefits to a corporate relocation policy benchmarking. For example, employers can learn how they can ensure their competitiveness in their industry to attract and retain talent with the highest level of skills and experience.

Industry best practice is to schedule a relocation program and policy review every 12 to 18 months to ensure your company maintains its competitive position. This review will also help your company learn about how the relocation industry is evolving to meet increased employee demands.

Conclusion

Global Mobility Solutions’ team of corporate relocation experts has helped thousands of our clients benchmark their relocation program and obtain significant savings and process improvements through centralization advantages. Our team can help your company understand how to obtain centralization advantages for its relocation program. As a result, your company will be positioned to make a number of improvements to its relocation program as it works to obtain centralization advantages.

GMS was the first relocation company to register as a .com. The company also created the first online interactive tools and calculators, and revolutionized the entire relocation industry. GMS continues to set the industry pace as the pioneer in innovation and technology solutions with its proprietary MyRelocation^® technology platform.

Global Mobility Solutions is proud to be named and ranked #1 Overall, and #1 in Quality of Service by HRO Today’s 2019 Baker’s Dozen Customer Satisfaction Survey.

Learn more about the centralization advantages your company can obtain for its relocation program. Contact our experts online or give us a call at 800.617.1904 or 480.922.0700 today.

We're Here to Help! Request a Courtesy Consultation

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Affinity Programs and Relocation: How Your Company Can Benefit

Post author By Ann Knapp | CRP, GMS, CMC
Post date December 17, 2019

Portrait of cheerful young manager handshake with new employee.

Many companies can benefit by adding affinity programs to their relocation policy. Relocation offers ample opportunities for transferees and new hires to use services. As a result, a robust relocation policy with well-structured affinity programs may provide a revenue stream to help offset administrative costs. Also transferees and new hires may benefit from special programs and discounts offered through these programs.

What are Affinity Programs?

Affinity programs are a structured partnership between businesses that promotes use of a service or purchase of an item. The Association of Chamber of Commerce Executives notes that these programs must provide value and specific price advantages for members in order to be successful.

A typical affinity program may follow the following steps:

Employer enters into an agreement with a business partner
Employer then offers the services to their employees
Employees gain a benefit from using the services (such as discounts on products and services)
Profits attributed to the employee’s use of the service are shared between the employer and the business partner

Employees gain value when they receive exclusive discounts and services in return for their participation. They also gain expert, hands-on guidance of experienced support staff from the business partner. Staff members are ready to help guide affinity program recipients through the process of selecting, ordering, and tracking the various services they desire.

Employers gain from affinity programs in several areas:

Revenue stream from profit share
Increased employee satisfaction
Enhanced goodwill through offering valued services
Association with a trusted business partner
Seen as an employer of choice among job seekers

What are Typical Affinity Programs in Relocation?

Typical affinity programs in relocation might include profit sharing based on transferee and new hire use of services offered by a Relocation Management Company (RMC). Services that may be eligible might include household goods moves, home selling/buying, mortgages, housing, or travel. These programs can be structured in many ways to meet employer’s needs as well as provide clear and defined value for employees.

Example: Traditional Temporary Housing

For example, transferees may be offered the option of using traditional temporary housing while they search for a home in their new location. If the transferee chooses to use this option, the employer will gain in the form of a profit share.

Importantly, the employer will also gain from having the transferee use housing that meets specific requirements for maintenance, cleanliness, amenities, and security. Transferees are more likely to have a positive experience when they use traditional temporary housing, as opposed to other housing options. This in turn will increase employee satisfaction with their relocation experience.

Many other housing options might initially seem attractive and offer a lower cost, but they may not meet cleanliness standards, and may carry hidden costs and unexpected issues for the transferee.

What Should Employers do About Affinity Programs?

Employers interested in learning more about affinity programs in relocation should work with a Relocation Management Company that has knowledge and expertise with these programs. An experienced RMC can help employers design their relocation policy to provide value for employees while returning many benefits to employers.

GMS offers clients its exclusive MyRelocation^® Affinity Program. Through this program, eligible clients are able to gain many valuable benefits for their companies and their employees, where available.

Conclusion

GMS’ team of domestic relocation experts has helped thousands of our clients develop value-added benefits as part of their relocation policies. Our team can help your company determine how to define affinity programs that provide positive returns and valuable benefits for employees.

Global Mobility Solutions is proud to be named and ranked #1 Overall, and #1 in Quality of Service by HRO Today’s 2019 Baker’s Dozen Customer Satisfaction Survey.

Contact our experts online to learn more about how to define affinity programs in your company’s relocation policy, or give us a call at 800.617.1904 or 480.922.0700 today.

Tags Affinity Programs, corporate relocation, Corporate Relocation Services, Domestic Relocation, Global Relocation Tips, relocation best practices, relocation programs

Relocation Best Practices Relocation Challenges Relocation Policy Review Relocation Programs

Year-End Relocation Expense Reconciliation: How You Should Prepare

Post author By Sam Hoey | CRP, GMS
Post date November 19, 2019

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Companies with relocation programs should prepare for their year-end relocation expense reconciliation. The relocation program may have several parts that flow into multiple departments and functions such as Accounting, Human Resources, Travel, and Tax. Therefore, thorough preparation is critical to capture all relevant information. Approaching this requirement with sufficient attention to detail will help ensure data accuracy and on-time reporting.

GMS recommends companies follow best practices for their annual reporting processes. There are five steps companies should take to ensure a positive result.

5 Steps to Prepare for a Year-End Relocation Expense Reconciliation

1. Create a Checklist for the Reconciliation

To start this process, begin writing a checklist. This checklist should include all of the information that accurate reporting requires. The checklist items should include several of the following data points:

Compensation data
Employees receiving tax filing services (those on the tax eligibility list)
Equity
Imputed income
Salaries/Wages
Taxes

Dates that are important for the year-end relocation expense reconciliation should be noted, such as:

Early cutoff dates
Due dates to receive data
Reporting deadline dates
Tax filing deadline dates

2. Schedule a Year-End Relocation Expense Reconciliation Preparation Meeting

Be sure to include representatives from all departments that must provide data for the reconciliation. Vacation time and holidays may impact work schedules, especially in the month of December. As a result, schedule this meeting to allow plenty of time for employees to learn what their role in the process is, what is needed from them, and to let them prepare the necessary data for reporting.

This meeting provides an opportunity to communicate expectations, as well as to develop relationships with colleagues who can assist with future year-end relocation expense reconciliation processes.

3. Confirm Data Accuracy

Companies should confirm all of the data that is reported for the reconciliation is accurate. Accurate accounting systems and processes should be in place to confirm data that is shared for the review. This step is absolutely vital to the entire process, as incorrect data could result in errors and additional costs. Data that should be confirmed includes:

Addresses
Benefits
Personal time (sick days)
Salaries/Wages
Social Security numbers
Tax ID numbers
Vacation time

Companies should ensure a thorough review of this data. An internal audit accountant might be helpful to confirm the accuracy of this data.

4. Finalize the Data to Prepare for Reporting

This step is to ensure the data includes all final reports through the end of the reporting period. Templates and sheets for the year-end relocation expense reconciliation may include blank lines or empty cells with highlights to note future data entry. For example, final year-end payroll figures may not be known until late December. All of this data should be stored on a server that is secure and continually backed up for easy retrieval if necessary.

5. Submit Reports

Confirm the reporting deadlines for every country that requires a report. Different groups of assignees or transferees may need to be further segregated for specific reporting requirements by tax reporting organizations. Whenever possible, send data early and confirm receipt. Note the final tax payment due dates for the year, and arrange for the payments.

What Does This Mean?

Companies should follow best practices to ensure accurate and on-time reporting for their year-end relocation expense reconciliation. By following best practices to confirm data and important dates, companies can avoid costly errors, expensive rework, and rush projects.

What Should Employers do About Their Year-End Relocation Expense Reconciliation?

Employers planning for their year-end relocation expense reconciliation should work with a qualified and experienced Relocation Management Company (RMC). RMCs will have knowledge that can assist companies in understanding all of the important parts of a reconciliation. They can also share recommendations and guidelines to ensure data verification and timely reporting processes. Companies should request an audit of their year-end relocation expense reconciliation to ensure they have a robust process.

Conclusion

GMS’ team of corporate relocation experts has helped thousands of our clients with reviews of their reconciliation processes. Our team can help your company understand how to design a year-end relocation expense reconciliation that follows industry best practices to ensure data accuracy and on-time reporting.

GMS was the first relocation company to register as a .com, created the first online interactive tools and calculators, and revolutionized the entire relocation industry. GMS continues to set the industry pace as the pioneer in innovation and technology solutions with its proprietary MyRelocation™ technology platform.

Global Mobility Solutions is proud to be named and ranked #1 Overall, and #1 in Quality of Service by HRO Today’s 2019 Baker’s Dozen Customer Satisfaction Survey.

Contact our experts online to request an audit of your year-end relocation expense reconciliation, or give us a call at 800.617.1904 or 480.922.0700 today.

Tags relocation best practices, Relocation Cost Management, Relocation Costs, Relocation Expense Reporting, relocation expenses, relocation programs, Year-End Relocation Expense Reconciliation

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Lump Sum Relocation Packages: What are the Advantages? What are the Disadvantages?

Post author By Ann Knapp | CRP, GMS, CMC
Post date November 5, 2019

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Global Mobility Solutions recently surveyed its clients to determine the impact of lump sum relocation packages on their organizations. Industry trends arising this year are having a direct impact on transferees. Often these trends become visible through the use of business intelligence and data analytics.

What are Lump Sum Relocation Packages?

Lump sum relocation packages are a specific amount of money that employers offer to transferees or new hires. This money replaces a number of relocation benefits such as household goods moves, culture and language training, or home-finding assistance. Essentially, employers expect employees receiving a lump sum payment to manage their own relocation process.

Advantages of Lump Sum Relocation Packages

Simplification

The advantages of lump sum relocation packages are related to helping employers simplify the process. The main advantage is that employers and their mobility managers have less complications around relocation support. Providing support during an employee’s relocation is reduced to answering questions about when the lump sum funds will be available.

Budgeting and Forecasting

Another simplification for employers revolves around budgeting and forecasting. Instead of working to understand the true costs of hiring new employees or transferring employees from one location to another, the budget process is tied to a number that is applied across the board based on tiers in the relocation program. An executive homeowner with a family relocating from Duluth, MN, to New York, NY is given the same lump sum payment as another single executive renter who is relocating from Las Vegas, NV, to Fort Wayne, IN. The renter will pocket a significant amount of money. However, the homeowner will not have enough funds to cover the costs of moving their family.

Disadvantages of Lump Sum Relocation Packages

Inadequate Coverage

Lump sum relocation packages make things easier for employers when it comes to administration and budgeting. However, there are several disadvantages employers are beginning to see in their organizations. First among these disadvantages are that many lump sum payments do not adequately cover all of an employee’s relocation costs. GMS’ 2019 Lump Sum Survey shows that employees are spending more, and sometimes significantly more, on their relocation than their lump sum payment. This includes:

61 % of homeowners reporting spending more
50% of renters reporting spending more

Employee Dissatisfaction

Ultimately, more than half of relocating employees do not receive enough lump sum cash to cover their expenses. Naturally, this results in a higher level of dissatisfaction with the organization’s lump sum relocation packages. Overall, dissatisfaction with lump sum payments follows these patterns:

58% of homeowners reporting dissatisfaction
53% of renters reporting dissatisfaction

Loss of Control

A significant disadvantage is the employer’s loss of control over how budget dollars are spent. Lump sum relocation packages disbursed directly to employees may result in company funds being spent on non-relocation expenses including cars, televisions, vacations, or any number of items. Funds spent on non-relocation expenses do not support the successful relocation of the employee. As a result, the relocation may be at higher risk of failure.

Inefficiencies

Many GMS clients achieve significant spending reductions with relocation programs that follow industry best practices. A major GMS client recently conducted an in-depth study of their relocation program expenses. This client learned that if their organization moved to a lump sum program, they might increase their relocation program expenses by 40%. In other words, by following industry best practices, this client keeps relocation budget dollars that otherwise would have been spent on inefficient lump sum relocation packages. Any GMS client can achieve the same reduction in relocation costs through:

Benchmarking their relocation policy to industry best practices
Efficient relocation program operation
Providing support to transferees that they actually need
Using business intelligence and data analytics to understand the true costs of their relocation program
Utilizing a competitive vendor network of relocation service providers

What Does This Mean?

Companies that offer lump sum relocation packages could potentially save a significant amount of budget dollars by following industry best practices. Lump sum payments let employers simplify their internal processes related to support, budgeting, and forecasting. However, this simplification may be costing employers up to 40% or more of their relocation budget dollars. It also results in over half of transferees reporting dissatisfaction with their relocation packages.

What Should Employers do About Lump Sum Relocation Packages?

Employers with transferees or new hires that are recent college graduates, individual contributors, or new to their professional career may be the best candidates for lump sum relocation packages. These employees are often renters and may not have a significant amount of household goods to move to a new location. Also, they tend to not require a significant investment in talent acquisition, as they compete for lower tier positions.

For employers who have new hires and transferees at higher tiers, industry best practice is to provide a range of benefits. Employees at higher tiers often require a significant investment in talent acquisition. Benefits that help ensure successful relocations also result in higher employee satisfaction.

Industry Benchmarking Studies Help Employers Compare Their Relocation Program

GMS has recently published several Industry Benchmarking Studies to help employers learn whether their company’s relocation program is designed following industry-specific best practices. There are many benefits to a corporate relocation policy benchmarking. For example, employers can learn how lump sum relocation packages in their relocation program compare to those offered by competitors in their specific industry.

Conclusion

GMS’ team of corporate relocation experts has helped thousands of our clients understand how to create relocation policies that attract and retain talent. Our team can help your company provide the best experience for transferees and new hires who have lump sum relocation packages.

Global Mobility Solutions is proud to be named and ranked #1 Overall, and #1 in Quality of Service by HRO Today’s 2019 Baker’s Dozen Customer Satisfaction Survey.

Contact our experts online to discuss how your company can leverage lump sum relocation packages for new hires and transferees, or give us a call at 800.617.1904 or 480.922.0700 today.

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Tags Domestic Relocation, lump sum, Lump Sum Programs, Lump Sum Relocation Packages, managed cap, Managed Cap Programs, relocation, Relocation Benchmarking, relocation best practices, Relocation Models, relocation programs, Workforce Mobility

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What are the Top 5 Benefits of Managed Cap Relocation Programs?

Post author By Sam Hoey | CRP, GMS
Post date April 16, 2019

Happy couple sitting by the boxes in their new apartment and talking to each other on a coffee break.

Managed cap relocation programs provide several benefits for companies and transferees. These programs provide services and allowances up to a specific capped dollar amount. This amount is set by the employer and noted in the company’s relocation policy.

Companies seeking to develop a relocation program often inquire about traditional lump sum programs. However, once they learn about the top 5 benefits of managed cap programs, most companies prefer them over lump sum programs.

What is a Traditional Lump Sum Relocation Program?

A traditional lump sum relocation program is simple in its approach. Basically, an employer provides a relocating employee a specific amount of funds. The relocating employee works with a Relocation Management Company (RMC) to choose services within the parameters of their employer’s relocation policy. As a result, the employer has little involvement in the relocation beyond arranging the funds.

In a traditional lump sum relocation program, a relocating employee must:

Review and choose van lines to move their household goods
Pack their goods, or arrange for packing services
Arrange travel to their new destination
Find and arrange for new housing options
Set up destination services including utilities and internet

What are the Disadvantages of a Traditional Lump Sum Relocation Program?

There are some disadvantages of a traditional lump sum relocation program. First and foremost is the relocating employee’s lack of expertise in making all of the arrangements to facilitate their move. Many people remember times they have moved to a new location, experiencing various challenges along the way. If these experiences are not all favorable, the memory of that experience may alter their perception of their new location, employer, or assignment. Also, any issues that arise may result in delays for the relocating employee to start their new position. If the lump sum amount is paid as a bonus on an employee’s paycheck, the amount will be taxed as income. As a result, this greatly reduces the amount of the relocation benefit to the employee.

Top 5 Benefits of Managed Cap Relocation Programs

Managed cap relocation programs offer several direct benefits for companies and relocating employees. The top 5 benefits of managed cap relocation programs are:

Assists employers with talent acquisition
Enables a strong focus on cost containment and savings
Program administration requires minimal management resources
Quick and easy implementation
Requires limited quality assurance management

What Does This Mean?

Managed cap relocation programs include support services from the RMC. Relocating employees receive policy counseling from experts to help them allocate their relocation funds. The RMC answers employee questions and acts as a guide through their relocation process. Relocating employees in managed cap relocation programs experience fewer budget overages. Also, these employees consistently report higher satisfaction levels than those employees who use traditional lump sum relocation programs.

What Should Employers do Regarding Managed Cap Relocation Programs?

Companies currently looking to implement a lump sum relocation programs should consider implementing managed cap relocation programs. Companies will gain 5 distinct benefits by choosing this type of relocation program instead of a lump sum relocation program. Also, they will experience higher relocating employee satisfaction levels.

Conclusion

GMS’ team of global relocation experts has helped thousands of our clients determine the relocation program that is the best fit for their organization and employees. As a result, our team can help your company understand how to gain the 5 benefits of managed cap relocation programs.

Global Mobility Solutions is proud to be named and ranked #1 Overall, and #1 in Quality of Service by HRO Today’s 2019 Baker’s Dozen Customer Satisfaction Survey.

Learn best practices from Global Mobility Solutions, the relocation industry and technology experts who are dedicated to keeping you informed and connected. Contact our experts online to discuss your company’s interest in managed cap relocation programs, or give us a call at 800.617.1904 or 480.922.0700 today.

Tags lump sum, Lump Sum Programs, managed cap, Managed Cap Programs, relocation management, Relocation Models, relocation policies, Relocation Policy Benchmarking, relocation programs

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The Future of Corporate Headquarters

Post author By Sam Hoey | CRP, GMS
Post date February 21, 2019

Many companies face challenges when considering where to locate their corporate headquarters. Major global companies such as Amazon, Apple, General Electric, and Google have recently announced expansion or relocation efforts that will take them to their next-generation workforce.

Recent expansion and relocation efforts for corporate headquarters have focused on major metropolitan areas.

Corporate Headquarters of Major Companies

Amazon

Amazon plans to create a second corporate headquarters location in Arlington County, Virginia’s Crystal City neighborhood. The location is across from Washington, D.C. The company said it will receive $573 million combined from Virginia and Arlington in performance-based direct incentives. These incentives include Amazon creating several thousand jobs at the new location. Notably, although Amazon had originally also chosen a second location in Long Island City, Queens, New York for another headquarters, mounting opposition led the company to pull out of its plans. This speaks to the importance of building local support among all stakeholders for any new corporate headquarters development.

Apple

Apple is planning to expand its presence in Austin, Texas with a $1 Billion new corporate headquarters campus. Apple’s future plans will eventually make it the largest employer in Austin. The new campus will accommodate 5,000 employees to start, and feature capacity for up to 15,000 employees.

General Electric

General Electric relocated its corporate headquarters to Boston, Massachusetts in 2016 and instantly became the state’s largest public company. Company officials noted that the Boston metropolitan area’s concentration of top universities and startup technology firms was the main attraction for their relocation. The move is seen as a way for the industrial conglomerate to rebrand itself as a forward-looking technology company. Although GE continues to face challenging markets and a changing economic future, the fundamental reason for the company’s move is shown in their intent to remain in Boston.

Google

Google plans to spend $1 Billion to expand the company’s New York City Hudson Square facility. The campus will be the main corporate location for its New York-based global business organization. The company will double its New York City workforce.

Corporate Headquarters Require Workforce with Significant Skills and Education

Companies looking to expand or relocate their corporate headquarters require employees with skills and education. Typical functions at these locations may focus on executive and managerial roles, product engineering and development, talent acquisition and talent management, sales and marketing, corporate communications, legal concerns, and finance. Many of the positions within these functions require degrees from institutions of higher education. Employees must be proficient with technology across multiple platforms. They must also display a broad range of soft skills including verbal and written communication, coaching, and leadership. Any company looking at a new location should work to keep current employees with desired skills and education during the relocation.

What Should Employers Seeking to Expand or Relocate Their Corporate Headquarters do?

Companies that are looking to expand or relocate their corporate headquarters should work with a Relocation Management Company (RMC) that has expert knowledge and extensive experience in corporate relocation services. Corporate relocation programs provide companies and employees all of the resources and tools they need to ensure a smooth and successful relocation process.

Choose an RMC that provides ongoing employee support services, supplier management, relocation benefits, and expense management. Employers should provide many resources for their relocating employees and their families. As a result, they will feel confident in accepting their new assignments and enthusiastic about the company’s corporate headquarters relocation.

Conclusion

GMS’ team of corporate relocation experts has the knowledge and expertise to help your company manage its corporate headquarters relocation budget. We will also offer your employees the best relocation experience during a corporate headquarters expansion or relocation. This will increase your company’s ability to retain current employees as well as attract new hires at your new location.

Contact our team of experts to discuss how we can help your company’s corporate headquarters relocation budget stay within company guidelines, or call us directly at 800.617.1904 or 480.922.0700 today.

Tags corporate relocation, Corporate Relocation Services, mobility management, Outsourcing Relocation Programs, relocation management, Relocation Models, relocation policies, relocation programs, Talent Management, Workforce Mobility

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Top 5 Reasons Why You Should Benchmark Your Relocation Policy

Post author By John Fernandez | CRP, GMS, SSB
Post date December 4, 2018

Young businesswoman giving presentation on future plans to her colleagues at office

Industry best practice shows employers should benchmark their relocation policy every 12 to 18 months to ensure your company remains competitive with your industry peers. A thorough benchmark will also help you learn about how the relocation industry is changing to reflect higher employee expectations for relocations.

As an employer, are you confident that every internal stakeholder in your company understands the importance of your relocation policy? Do you think they understand how it relates to their functional discipline? Most employers understand their relocation policy impacts several departments. As the competitive landscape changes in their industry as well as in the relocation industry, the importance of why employers should benchmark their relocation policy becomes increasingly clear.

Top 5 Reasons You Should Benchmark Your Relocation Policy:

1. You Should Benchmark to Identify Enhancements and Cost Savings

Reviewing industry best practices can show areas where your company can save costs or enhance your relocation policy to reduce costly exceptions. Learning about new and changing regulations can help your company avoid costs that may arise from immigration, legal, or tax issues. A thorough benchmark will identify technological enhancements that may be useful for communications, processes, or cost savings.

2. Align Corporate Mobility Objectives on a Global Basis

Many companies have operations spread around the world. This may lead to significant differences in relocation policies and implementations. Employers should benchmark their relocation policy to identify such differences. They should also work to align all areas to a consistent policy that fully supports corporate objectives regardless of location.

3. Understand Your Industry’s Competitive Relocation Landscape

Most of your industry peers also have relocation policies they use to attract and retain new hires and transferees. Employers should benchmark their relocation policy to identify how their industry competitors are designing their relocation policies. With this information, employers can then design a relocation policy that ensures they remain competitive and will be able to attract highly skilled talent.

4. Learn About Relocation Innovations

Technology is useful for informing and engaging employees throughout their relocation process. It also increases the speed of communications and provides valuable information and assistance. Technology can help transferees receive reimbursements in a timely manner. Employers should benchmark their relocation policy to help them learn about new ideas and innovative solutions to employee relocation issues.

5. Increase Internal Stakeholder Knowledge on Why You Should Benchmark

At most companies, several departments interact with the relocation process. Internal stakeholders from finance, procurement, and legal can learn how transferees interact with each department, what their needs are, and what the best practices are related to their discipline. Employers should benchmark their relocation policy and include internal stakeholders in the process. This will ensure their understanding of relocation policy guidelines. Also, it will help provide transferees with a smooth and easy relocation process as they interact with diverse internal stakeholders.

What Should Employers Do?

Employers should benchmark their relocation policy with a knowledgeable Relocation Management Company (RMC). The policy benchmark should include a full assessment of the company’s current policy as well as corporate objectives. This allows the RMC to benchmark the relocation policy to industry best practices. As a result, the RMC will be able to present a full complement of recommendations to ensure the employer can implement relocation policy best practices. This will also help them maintain a competitive edge in their industry.

Conclusion

Global Mobility Solutions’ team of corporate relocation experts has helped thousands of our clients understand why they should benchmark their relocation policy. We can help your company understand how to create a relocation policy that reflects industry best practices. As a result, this will ensure the policy attracts highly skilled new hires and transferees.

Learn best practices from Global Mobility Solutions, the relocation industry and technology experts who are dedicated to keeping you informed and connected. Contact our experts online or give us a call at 800.617.1904 or 480.922.0700 today.

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At GMS, we make it a priority to know how talent mobility is changing in each major industry. What are the best practices? How are other companies changing their programs to retain a competitive edge? Your Mobility Pro will be in touch within 1 business day to help answer your questions and benchmark your industry.

Tags relocation, relocation best practices, relocation policies, Relocation Policy Benchmarking, relocation programs, relocation technology