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7 Key Components of A Successful Employee Relocation Program

Companies have to relocate employees for different reasons. They may be changing locations entirely, need to make up for a skills deficit in a regional office, or want to attract top talent located elsewhere.

A comprehensive relocation program can make these scenarios less of a headache and more of an opportunity. The program you create will differ based on your budget, resources, and business goals, but it should include the following features.

Incorporate Your Talent Management Strategy Into Your Plan

Relocation isn’t as simple as throwing a moving budget at an employee and sending them on their way. Everything from a stressful moving process to friction with their new team can compel an employee to start looking for other jobs. There goes that person you invested so much money into developing.

Your relocation program should first and foremost have a set of principles that determine conditions that need to be met before transferring an employee. Is relocation a short-term fix or will it make a positive impact on the organization’s business goals? Does the employee in question adapt well to change?

Relocations are expensive, so a comprehensive policy can prevent you from pouring too much money into accommodating a new hire or funding an existing employee’s move.

Prepare Detailed Information About The New Location

Now that you’ve decided an employee is worth the investment, it’s time to make sure they believe you’re worth the move. Every employee should receive detailed information on the area they’re moving to. This includes, but is not limited to:

  • Average cost of living
  • Information on different neighborhoods
  • Information on the school system

The point of this is to make the process feel as painless as possible. Even if an employee is willing to move, the logistics of a relocation are overwhelming and can add stress not just to themselves but to their family as well. Providing details that reduce their burden is the easiest and cheapest part of your program.

Offer Temporary Accommodations At The Start of Their Relocation

Finding a new place doesn’t happen overnight. Employees have to either sell their existing place, provide their landlord with enough notice, or find someone to take over their current lease. Even if tying up loose ends in their old city proves simple, finding a new place may not be as straightforward. It’s also expensive if they need to stay in a hotel or find a short term rental while house hunting.

Providing employees with free accommodations for a couple of months is a smart way to tempt talent to move and avoid any relocation resentment.

Allocate Money To Moving Expenses

An employee may not be in a position to (or want to) spend money on moving trucks or new furniture. By providing a relocation budget, you can draw in new talent that’s willing to move, but are reluctant to incur moving expenses.

If your organization absolutely cannot afford to cover the costs of a move, provide information on how they can deduct work-related moving expenses on their tax return, if applicable. Be mindful of what conditions apply in your jurisdiction in order to be eligible for this deduction.

U.S. companies: About IRS Form 3903

Canadian companies: About Line 219

U.K. companies: About employer reporting exemptions for relocation costs

Australian companies: About work deductions

Cover Real Estate Expenses

Employees who are house rich and cash poor have a lot of their equity tied up in their home. This means they may not have the cash flow to invest in all the incidental expenses that come with moving. Providing some funding for closing costs and legal fees can help soften the financial hardship that comes from transferring locations. This can be pricey for your organization, but worth it for the right employees.

In fact, this is where incorporating your talent management strategy and relocation strategy comes in handy. If you’ve established processes and principles for deciding which employees to relocate, you can create a tiered system of relocation benefits for varying levels of seniority, priority, or experience.

Include Pay Adjustments and Relocation Bonuses

Even if you can’t swing the other forms of financial assistance, this is one of the minimum features you should include. If your company is relocating to a city with a higher cost of living, an employee’s existing salary won’t go as far. And even if they do suck it up and take the unadjusted paycheck, it’s only a matter of time before they start searching for higher paying gigs in the area. The last thing you want is for nearby competitors to start poaching your talent. You can sweeten the deal and get uncertain employees off the fence by throwing in a relocation bonus.

Offer Support For The Family

If your employee has a family, this only compounds the difficulty of their situation. For starters, their family has to uproot their lives. But on a more practical level, there’s double, triple, or quadruple the logistics to handle. Their spouse may need to find a new job and their children will have to start at new schools. To reduce some of the emotional stress tied to such a big move, provide employees with school information, job search resources, or even some work schedule flexibility in the first couple of months.

It’s inevitable that your company will go through changes. That can’t be controlled. What you can control is how you react to them. By respecting the impact organizational changes have on your employees and giving them the tools they need to respond to them, you can ride the waves of organizational change without draining valuable talent as well.

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