In a global marketplace, employee relocation services help businesses put the right team in the right place. Whether you’re planning an international project, inviting employees from abroad or opening a new office, you’ll need to manage all the usual business travel logistics from flights to accommodation and visas.

Apart from managing travel itineraries, HR departments need to settle workers into unfamiliar environments, while finance departments must tackle the various costs of relocation. This is where a concrete policy helps. In this blog, we’ll explain why a corporate relocation policy is so important and give you the essential components of a successful one.

What is the meaning of employee relocation?

Employee relocation describes the process of moving workers from one location to another. This might involve settling new hires to your central corporate office, executive relocation to a different country, or transferring a seasoned team to a nearby city.

Whether the move is to a close suburb or across the world, employee relocation requires talent to uproot their lives, which is why an attractive and well-crafted corporate relocation service is key to success.

When does employee relocation make sense?

As with short-term business travel, there are numerous reasons for longer-term relocation. Here are a few typical scenarios:

New hires are brought to the company’s headquarters for in-depth, in-person training.

  • New employees are moved from another city or country to work at company headquarters on a permanent basis.
  • The company opens a new satellite office in a different country that requires experienced team members.
  • The company works on a site-specific project that requires workers with a certain set of skills.
  • The employee requests a transfer to a different country that they’ve always wanted to live in.
  • An employee is offered a promotion with the caveat that they move to a different region.

Relocation benefits for employers

With the growth of remote work and flexitime, more employees are willing to move for a job – particularly if it’s to a location with a lower cost of living.

Replacing seasoned employees is a costly endeavour, too. Gallup research finds that replacing front-line employees costs 40% of their salary, a percentage that goes up to 80% for technical professionals and a staggering 200% for experienced managers. Location flexibility boosts employee retention, helping your company hold onto top talent.

At the same time, employee relocation helps grow your business, whether it’s scaling up through staffing projects or opening new satellite locations.

Relocation benefits for employees

Employees are drawn to relocation for a variety of reasons, including the opportunity for new experiences and career progression. According to a 2024 Remote Workforce Report, 71% of companies surveyed hire internationally, opening the doors up for promotions and advancements.

A change of scenery alone can be incentive for those who already enjoy business travel. Relocation lets workers spark new connections and grow an in-person network of like-minded professionals abroad, all while experiencing a different culture.

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How does employee relocation work?

Relocations can be voluntary or involuntary. With voluntary employee relocation, the employee typically makes the request for a transfer, which is then signed off on by the employer.

With involuntary relocation, the employer is the one who makes the request as a caveat for promotion.

In either type, once agreed upon by both parties, the employer will create a custom corporate relocation package covering all moving and travel expenses. At this stage, many companies enlist the help of a business relocation service to manage the logistics of the move, from finding accommodation to providing family support.

Types of moves requiring a relocation service

Not all relocation involves a permanent international move. In fact, many requests are short-term, and project based. Here are the three main types of employee and executive relocation:

Business travel

Lots of jobs involve frequent business travel that lasts more than a weekend here or there. Sales representatives and consultants often return to the same city for meetings, which necessitates recurring itineraries and accommodation. Travelling for a specific project also falls under this category, whether it lasts for weeks or months.

In these cases, using a corporate travel platform like Booking.com for Business helps immensely with managing multiple itineraries. Admin teams can also track travel expenses for fast reimbursement, while ensuring employees are safe on the road.

Short-term employee relocation

Unlike business travel, which allows an employee to dip in and out of the country, a short-term relocation requires residency. However, it will be for a fixed term with a set end date.

Long-term employee relocation

Long-term relocation requires the employee to move to another city or country for at least a year, or even indefinitely. While short-term executive relocation comes with an end date, long-term plans are more open-ended. They also involve more complicated legal, tax, and compliance issues.

How does relocation affect employees?

There’s a multitude of benefits associated with business relocation, but along with these come challenges. Moving for work isn’t a decision that’s taken lightly, as relocation can have an impact on family life, personal time, and cost of living. For big moves abroad, a relocation might also require the need for language lessons and ongoing company support.

Relocation costs for employees

Relocation costs for employees should be covered by the employer, include moving, supplies, and potential employment support for families. Even when the move is voluntary, relocation expenses should be considered as part of any financial package.

Can employees refuse to relocate?

When an employer moves their business location and requests an employee to come along, this is considered an involuntary move. But can employees refuse to relocate? It depends on the employment contract. Some include a mobility clause, which states that employees are required to move (within reasonable limit) if asked.

What is an employee relocation policy?

Corporate relocation policies are packages of benefits available to workers that move to new locations. This includes financial assistance to cover relocation costs for employees. It also includes administrative assistance to ease the strain of moving, including support with things like visas, finding accommodation, and help with packing.

In addition to listing all the benefits and assistance, a corporate relocation policy outlines employee rights and employer responsibilities.

What should an employee relocation policy include?

The ultimate purpose of any employee relocation policy is to take all the guesswork out of rights and expectations. To this end, you’ll need to include the following sections:

  1. Eligibility for benefits: Cover who is eligible for financial support and whether this varies by job title or relocation type.
  2. Outline of benefits: Describe the specific types of benefits and their financial limits.
  3. How to claim benefits: Outline how the employee can claim benefits, whether this involves receipt reimbursement or use of accounting software.
  4. How to handle unexpected expenses: How does the company handle unforeseen issues, such as cancelled flights?
  5. Non-reimbursable expenses: Are there any travel-related expenses that aren’t covered?
  6. Tax implications of benefits: Do these financial benefits count as taxable income in your country?
  7. Administrative relocation support: Does the employer aid with visas and languages? Is a local guide provided?
  8. Family relocation support: Does the employer help provide temporary assistance or job support for family members?

What is a relocation allowance?

A relocation allowance is part of the overall package, referring to the financial benefit employees can expect as part of the move. This may be offered as a lump-sum payment, or reimbursement for travel expense receipts.

Relocation allowances typically cover the same costs incurred during business travel:

  • Airfare and train tickets
  • Car hire costs
  • Per-diem for meals
  • Cost of temporary accommodation
  • Cost of moving house

In addition, they cover the cost of storage and incidentals.

What is a typical relocation package?

While a relocation allowance covers travel-related costs, a full relocation package describes additional benefits associated with the cost of moving house.

If your company’s not providing accommodation, this starts with the expenses of house hunting for an employee’s new permanent address. Some corporate relocation packages help buyers pay for real estate agent fees, surveying and conveyancing fees, and mortgage application costs.

You should also expect to cover the cost of moving, including packing and storage at the new address. Once the employee has moved into their new home, additional costs include appliance installation and utility hook-ups.

Bear in mind that none of these costs are required; it’s up to your business to determine which expenses are covered. Many companies offer tiered packages. For example, executives’ relocation would have more expenses paid than new hires. Fully covered corporate relocation packages are typically reserved for senior employees.

Why does your business need a corporate relocation policy?

The first reason to use a relocation policy is that it entices talent to your preferred locations. Employees might be hesitant about making a big move unless they know they’ll receive adequate support, and seeing it spelled out in writing helps seal the deal.

Secondly, corporate relocation policies ensure that you stay within budget. Moving costs can quickly spiral out of control, but by outlining spending limits along with non-reimbursable expenses, you can keep expectations in check.

Step-by-step guide to writing an employee relocation policy

A good employee relocation policy drives grade-A talent to your business, assisting with recruitment and retention. Here’s how to write one.

Step 1: Meet with all relevant departments

Get your human resources, business, and finance departments together to discuss what is – and isn’t – possible. While the HR team typically writes this policy, they’ll need to discuss timelines, deadlines, and internal processes. Then, you can also meet with hiring managers to identify employees best suited to relocation opportunities as they arise.

Step 2: Select preferred vendors

Research and create a list of preferred outside service providers to list in the policy. This includes preferred real estate agents, moving companies, and corporate relocation services.

Step 3: Identify potential legal issues

Identify your target locations. If moving employees internationally, you’ll need to speak to the legal team to discuss immigration issues and visas. You’ll also need to think about tax compliance, which should be covered in the document.

Step 4: Work to a realistic timeline and budget

Together with the finance team, research and create an initial budget. Decide which expenses will be covered, and which are non-reimbursable, so that you can describe them accurately to employees.

Step 5: Make expectations clear

With your budget, goals, and benefits defined, write your policy using clear and user-friendly language. It should answer all questions that an employee might have, defining the benefits and perks they can expect as part of a relocation package. Be sure to include contact details for someone who can clarify any issues.

Step 6: Get approval from all stakeholders

Send the policy draft to all stakeholders for approval. This should include the HR, legal, and finance teams.

Step 7: Collect feedback and adjust as needed

As you start relocating employees, ask for feedback along the way. Were there any benefits they would have liked covered? Did any unexpected challenges arise as part of the relocation process? Use this feedback to revisit and revise your policy over time.

Special considerations for SMEs

While larger corporations often have the departments and personnel to handle relocation services internally, SMEs are more likely to require outside expertise. This is where an international relocation company can help to ensure your employee paperwork is travel-ready and legally compliant.

Small businesses often need to find short- and mid-term stays for employees as they search for more permanent residences. For convenient travel booking, turn to SME travel management platforms like Booking.com for Business. You’ll not only be able to book and manage travel during the relocation process, but also gain full visibility over the costs of accommodation, flights and car rentals.. Travel assistance is included too, so you can give your employees the support they need during transitions.

What does a corporate relocation service do?

Whether domestic or international, a corporate relocation service facilitates moves. They help juggle all the moving parts involved during this transition, from packing to offering real estate support. International relocation services also assist with visa applications and language services. For employees travelling with families, a good business relocation service will find schools, provide employment assistance, and arrange transport.

What to look for in a business relocation service

An international relocation service is sometimes confused with a moving company. While they will liaise with a moving company to pack and physically move belongings, the service is more comprehensive.

A business relocation service will do more than simply move your things from point A to point B. As you compare options for employees, look out for services that can also:

  • Provide intercultural training
  • Arrange language lessons
  • Coordinate with real estate agents
  • Arrange travel visas
  • Help with family support

Employee relocation can be an overwhelming prospect, but with the right planning and policy it needn’t be stressful. The key is to maintain an open line of communication throughout the process, ensuring your valued employees get the support they need at every step.

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