Meet the WHR Family

Due to the pandemic, this long overdue trip finally took place in the summer of 2023. I was given the opportunity to travel from Singapore to our WHR headquarters in Pewaukee, Wisconsin to spend some time with my US colleagues.

After doing video calls for the past two years, it was exciting to meet my colleagues in person. The first thing that I said to my US counterpart Jon DesChane (who I talk with almost every week) was, “Oh my gosh, you are so tall!”

Week 1

During my first week in the office, my colleagues organized a potluck. At the pantry, Kay Cucinello from the Household Goods Department came up to me and said “Ni hao” with a big smile on her face. Wow. There were at least fifteen types of food and yes, I tried every single one of them: puppy chow, peanut butter brownie trifle, the famous Wisconsin cheese curds to name a few. My Director, Heather Hess, CRP, GMS prepared at least three dishes and amazed me with her mouth-watering buffalo chicken dip. I was touched by my generous colleagues who took time out of their busy schedule to give me such a warm welcome. If I may paraphrase, the way to a woman’s heart is through her stomach!

Jon, who reminds me of Sheldon from The Big Bang Theory (I believe Jon actually majored in Physics), thought it would be a good idea to bring me to a baseball game. Despite Jon being an avid sports fan and trying his level best to do a Baseball for Dummies 101 during the game itself, I caught no ball.

Nevertheless, it was definitely a once-in-a-lifetime experience and to me, the highlights of watching the baseball game were:

1. Pre-drinks before the game.

2. A colleague nudged me to remove the Milwaukee Milkmen cap when the national anthem was played as a sign of respect, please pardon the ignorance of a foreigner.

3. During interludes, there were brief interactions with the audience. One was with a war veteran, and he was treated with utmost respect by everyone.

4. Queuing for snacks—I did not try the hotdog as I do not take beef, but the bratwurst was delicious. Special thanks to our Head of Global Sales, Chris Lagerman who gave us all a treat.

5. The fun vibes with people singing along to Neil Diamond’s Sweet Caroline (Good times never seemed so good, so good, so good …).

6. Sean Thrun, our Strategic Initiatives Manager bought me a pack of Big League Chew and I learned that chewing gum and baseball have a long history. Sean was in Singapore recently and he knew that chewing gum is illegal in Singapore, I kid you not.

7. Fireworks at the end which lasted for more than fifteen minutes.

By the time the game ended, the temperature had dropped quite a bit. Another colleague from Accounting Department offered to send me back to my serviced apartment. Never in my wildest dream did I imagine that we would end up having a karaoke session in the car, singing JVKE’s Golden Hour and Queen’s Bohemian Rhapsody at the top of our lungs. I cannot remember when was the last time I had so much fun. This totally changed my perception of our Accounting team, who were usually the quietest bunch in the whole office. Accounting (led by our powerhouse CFO, Jami Long) ROCKS!

Week 2

My awesome HR Manager Kimberley Uitz, SHRM-CP, GPHR mobilized the entire office to set up the Bags/Cornhole Tournament, which was brought forward to August for my sake. In the spirit of the tournament, my teammate and I came up with the name “Oh Shucks” for our team. The other Client Service Managers, David Peters, CRP and Ben Koceja displayed their agility and prowess in the game effortlessly. A casual toss from these masters and the bean bag goes right into the hole.

I had no regrets squeezing a pair of badminton rackets and shuttle cocks (badminton is one of the most popular sports in Asia) into my luggage because I got a glimpse of our Supply Chain Manager, Adam Rasmussen‘s competitive streak as he impressed me with his lightning reflexes and powerful smash.

Special shoutout to our IT Director, Jeff Beyer and his boys, who are always on standby to help us with our IT set-up.

What I learned at our US Office

Generally, what I learned about my colleagues in the US office:

  1. People tend to rise earlier here, and some of my colleagues start work as early as 7am. Lunch is a simple affair where most people bring food from home, unlike in Singapore where going out for lunch is the highlight of our day.
  2. Almost everyone I know in the office has a pet cat and/or dog, some even more than one.
  3. People in Wisconsin love sports, and even if you don’t play, you would support a baseball team.
  4. The Midwestern hospitality is real. When Heather brought me to an Arts festival, we were walking around the neighborhood and came upon a family giving out free bratwurst in front of their house. There was a steady stream of people coming in, just sitting together and having a cordial chat over bratwurst. Perhaps it was the summer heat that melted the ice between total strangers, or people are generally friendly in this city. Kimberley and her beautiful family spent their whole Saturday with me: we went for a little hike at the Devil’s Lake, visited Wollersheim Winery and they brought me to a shop selling all kinds of cheese (can’t miss that in America’s Dairyland). My big boss, Roger Thrun (founder of WHR) was the perfect gentleman when he brought me out for a tour at his lavender farm, but that is a story for another day.
  5. Myth debunked: US is dangerous. I stayed in a place called Oconomowoc, which was a nice and safe neighborhood. Just like any big city in any part of the world, there are some dodgy places where you would not want to go alone. I am indebted to my team for being such great hosts and planning everything for me to enjoy my first-ever trip to the US.

You can’t count someone as your family until you have had a disagreement. There are times when we disagree on how certain things should be done. This could be due to cultural differences, regional nuances and how we perceive things from a different lens. This trip has helped me to understand my US WHR family so much better, and I hope vice versa too. At the end of the day, we all want the best for our family and I know without a doubt, that my family always have my back.

Relocating Employees to Switzerland? 10 Apps to Recommend.

Relocating Employees to Switzerland 10 Apps to Recommend

Is your organization relocating employees to Switzerland? HR, global mobility, and talent acquisition teams are expected to guide employees through this process and provide key resources. Some of the greatest resources an organization can provide to that employee are free or low-cost mobile phone apps. From Swiss customs to public transportation: here are 10 must-have apps you should recommend when relocating employees to Switzerland.

Transportation App for Employees Relocating to Switzerland

SBB

SBB stands for Schweizerische Bundesbahnen, which translates to Swiss Federal Railways. Consequently, as Switzerland’s largest transport company, SBB runs all major trains in the country. At the same time, SBB also provides links to the European high-speed network. Every day over a million passengers and more than two hundred thousand tonnes of freight travel on board more than ten thousand trains along the SBB rail network. Employees relocating to Switzerland can use the SBB Mobile app for public transportation all throughout the country. Relocating employees can also buy tickets from ticketing machines or at ticket offices in bus or train stations. Some buses in rural areas don’t have machines and ticket offices.

Payment App for Employees Relocating to Switzerland

TWINT

With TWINT, Switzerland’s payment app, employees relocating to Switzerland can make convenient and secure payments using their smartphones. The TWINT app makes it easy for expats to pay at store cash registers, in the supermarket, in the online shop, and when shopping in the farm shop – digitally and cashlessly.

Customs App for Employees Relocating to Switzerland

QuickZoll

QuickZoll is the official Swiss customs app for individuals. As a private individual, QuickZoll allows to employees relocating to Switzerland to independently declare goods for importation for their own use or as a gift and pay any applicable taxes and duties directly. In addition, the Swiss Customs app summarises all the important facts about entry to Switzerland briefly and concisely.

Public Safety App for Employees Relocating to Switzerland

Alertswiss

Alertswiss is the official, free mobile app which publishes all relevant information pertaining to precautions and behavior during disasters and emergencies in Switzerland. Although Switzerland is rarely affected by major disasters, it is good to know which dangers exist and which behaviour can protect employees relocating to Switzerland. Relocating employees can receive alerts, warnings, and information about their current location directly and constantly on their smartphones. 

Social App for Employees Relocating to Switzerland

InterNations

InterNations is a global community for people who live and work abroad. It’s the largest network of its kind, with around 4 million members in 420 cities worldwide. It offers networking and socializing both online and in person. Additionally, members can attend events, participate in forums, and receive tips and advice on expat life. In similar fashion, InterNations conducts an annual Expat Insider survey that ranks countries and cities. In 2023, Mexico was ranked the best place for expats.

Language Apps for Employees Relocating to Switzerland

Google Translate

Google Translate‘s mobile app is a must-have for expats in Switzerland. Chiefly, it is a multilingual neural machine translation service developed by Google to translate text, documents and websites from one language into another. Given that Switzerland has 4 national languages (German/Swiss German, French, Italian, and Romansh), employees relocating to Switzerland can look forward to translating many street signs, menus, and more.

Duolingo

Communication App for Employees Relocating to Switzerland

WhatsApp

Food Apps for Employees Relocating to Switzerland

Just Eat

Formerly known as Eat.ch, Just Eat is an excellent solution for employees in hotels, temporary housing, or transferees waiting for their kitchen supplies to be delivered by the moving company. Expats in Switzerland, accordingly, can order takeout or delivery from the Just Eat app from most cities in Switzerland, including Zürich, Geneva, Basel, Bern, Lausanne, and more. 

Too Good to Go

Due to its high cost of living, expats in Switzerland may have an affinity for the mobile app Too Good To Go. Too Good To Go is a free app that helps reduce food waste by allowing users to buy unsold food from restaurants, bakeries, and other businesses at a discount. In their 2022 annual impact report, Too Good To Go stated 2 million users open the app daily which saved 79 million meals. Even more, the app serves a greater purpose; It’s estimated nearly one-third of all food is wasted while 828 million people go hungry every day. By selling unsold food at discounted prices, businesses reduce excess waste and help communities reduce greenhouse gas emissions. 

Relocating Employees to the US? 10 Apps to Recommend.

Relocating employees to the US

Is your organization relocating employees to the US? HR, global mobility, and talent acquisition teams are expected to guide employees through this process and provide key resources. Some of the greatest resources an organization can provide to that employee are free or low-cost mobile phone apps. From language training to hotels, travel, and more: here are 10 must-have apps you should recommend when relocating employees to the US.

Social Apps for Employees Relocating to the US

InterNations

InterNations is a global community for people who live and work abroad. It’s the largest network of its kind, with around 4 million members in 420 cities worldwide. InterNations offers networking and socializing both online and in person. InterNations members can attend events, participate in forums, and receive tips and advice on expat life. InterNations also offers an Expat Insider survey that ranks countries and cities. In 2023, Mexico was ranked the best place for expats.

MeetUp

Meetup is a social networking site that allows people to find and join groups based on their interests. Meetups are informal meetings or get-togethers for people with similar interests. Meetups can be in-person or virtual, and can take place in places like cafés or parks. There are no membership fees to join Meetup, which makes it an excellent app for expats to build their new friend groups and social networks. 

Language App for Employees Relocating to the US

Duolingo

Communication App for Employees Relocating to the US

WhatsApp

Hotel & Travel App for Employees Relocating to the US

Booking.com

Headquartered in Amsterdam, Booking.com is an online travel agency that connects travelers with a wide variety of places to stay. The company was founded in Amsterdam in 1996 and has over 28 million accommodation listings. Booking.com offers discounts on hotels, flights, car rentals, taxis, and attractions. This is extremely useful for expats who are left for themselves to book hotel stays on short notice, or rental vehicles during their preview trip and temporary housing. 

Transportation Apps for Employees Relocating to the US

Uber & Uber Eats

When employees are relocating to the US, ride-hailing apps such as Uber are cost-effective solutions to getting to and from hotels, temporary housing, apartments, and homes. Furthermore, when expats are tired and jet-lagged from travel, they can order a plethora of food and other products on Uber Eats from the comfort of their hotel or temporary housing.

Lyft

Similar to Uber, Lyft provides ride-hailing, rental cars, and food delivery in the United States and Canada. Lyft offers a marketplace where drivers can be matched with riders through the Lyft app. Lyft also offers other transportation options, such as motorized scooters and bicycle-sharing. Lyft offers ride booking, payment processing, and car transportation services. Lyft can be a fantastic alternative when there is a spike in price, or lack of availability through Uber. 

Mental Health App for Employees Relocating to the US

Headspace

After death and divorce, it’s said that relocating is the third most stressful event in a person’s lifetime. Headspace is an app that offers guided meditations, courses, and mindfulness exercises on topics like stress, anxiety, and building resilience. The app aims to improve concentration and mood, and reduce anxiety. Offering hundreds of meditations, sleep sounds and music, focus music, and mood-boosting workouts, Headspace is an excellent mental health tool for expats who need to slow down and breathe. 

Home Goods App for Employees Relocating to the US

Amazon Prime

When expats need something delivered on short notice to a hotel, temporary housing, or unfurnished home, Amazon Prime can be an excellent and cost-effective solution. Some assignees may choose to bypass their household goods shipment altogether and purchase everything at their destination with a furnishings allowance. From TVs to furniture, cleaning supplies, and more, Amazon Prime is an excellent way for expats to furnish their new homes or deliver an essential item to temporary housing.

Self-Move App for Employees Relocating in the US

SimpleMove®

SimpleMove is a free, online platform developed by WHR Global. It can be used by: (1) employees relocating themselves within the US; (2) HR and talent acqusition teams who want to a self-move or lump sum solution for US relocations; or (3) established global mobility programs who want a cost-effective solutions for US relocations.

The largest financial benefit is a tax-free, cash-back rebate paid to the employee when they sell or purchase a home through a SimpleMove real estate agent. The rebate, paid after closing, is based on $5 USD per every $1,000 USD of the sale or purchase price. There is no cap on the rebate amount; For example, a $300,000 USD home sale or purchase will provide the relocating employee with a $1,500 USD rebate. This is in addition to accessing WHR Global’s network of moving companies, rental agents, temporary housing providers, mortgage lenders, and other helpful resources within the platform.

Relocating Employees Contact WHR Global Image

7 Benefits of Outsourcing Your Relocation Program

In the days of low volume, Human Resource professionals comfortably managed the relocation of a few key employees without the aid of a specialist. These moves might have been a generous lump sum with access to a preferred household goods carrier, but while this worked in the past, relocation best practices and the workforce industry itself have changed significantly. In order to source the very best talent for the job, it has become essential for companies to have a global relocation program that adheres to today’s best practices while also staying up to date on tax and legal requirements. Creating and successfully running a relocation program that competes in today’s global market is a demanding task that requires more time and understanding than ever before, which is why HR departments traditionally outsource the relocation process. Using a professional relocation management company (or RMC) eases the burden of meeting the demand for top talent by providing these seven fundamental benefits.
relocation program

1. Knowledgeable Relocation Experts

If relocation is something you manage right now, there’s a good chance you manage other workforce-related tasks in your department, such as recruiting, onboarding, and training. Balancing so many responsibilities makes it difficult to become a subject matter expert in all of these areas.

With the aid of an RMC, you and your transferring employees won’t have to worry about being the subject matter expert on relocation because RMCs have staff trained specifically to make your program as smooth and seamless as possible.

At WHR Group, we take our staff’s knowledge one step further by requiring real estate licensure to ensure you and your employees have the most experienced and knowledgeable real estate experts on your side.

2. More Time to Focus on Impact

We’ve already established relocation management as a task that really requires your full attention, often leaving your other responsibilities in the dust.

Having an RMC manage your relocations for you allows you to have a higher impact in your strategic initiatives.

3. Vast Network of Suppliers

Having a trusted supplier network in place is an important aspect for any professional RMC. RMCs build relationships with suppliers ranging from household goods carriers to international destination agents so you don’t have to.

Managing a relocation program is difficult enough without also having to manage the selection and qualification of these third parties. While a huge undertaking, it’s one that is easily accomplished through an RMC, which typically has a team dedicated to managing this network.

By being connected to a larger network of tracked and vetted suppliers, you are guaranteed to offer your employees more choices when it comes to who they work with, with more consistent service and at discounted rates.

4. Competitive Policies

An important consideration for your relocation program is knowing what benefits will entice job candidates most, no matter where the job is located. It’s a delicate balance of offering the most competitive relocation benefits in your industry while still being cost-conscious.

A professional RMC will benchmark your relocation policies against your competition to ensure you continue attracting the candidates you are most interested in.

5. Increased Cost Savings

RMCs are constantly moving high volumes of transferring employees for multiple clients annually. This means they are building strong relationships with several different suppliers for things like home sales, temporary housing, and international services, which benefits you with suppliers’ best-rate pricing and a track record of top-tier service.

This varied knowledge also enables RMCs to make policy recommendations for maximum cost savings on your program.

6. Tax Compliance

The tax and legal requirements of relocating employees are extensive, which is why RMCs offer considerable advantages.

Your RMC will guide you through any issues or concerns while ensuring that all tax-deductible requirements are met on each of your relocations.

7. Ease of Technology

Managing the relocation process through a system not built exclusively for your relocation program can make an already difficult job impossible. For this reason, RMCs continuously invest in their relocation system to respond to the evolution of tax laws, reporting needs, and clients’ unique policy requirements.

These systems, like the one WHR Group built for its clients from the ground up, offer real-time access to customizable reports, cost analysis tools, and the ability to track your employees’ relocations through a sophisticated internal workflow.

 

The challenges of managing a relocation program in-house have led many HR departments to seek outsourcing opportunities. Because relocation management requires a vast amount of consideration, it is an ideal candidate for outsourcing. By seeking an RMC for your company, you play a vital role in renewing and strengthening not just your relocation program but your involvement in HR and the workforce industry as a whole.

The RMC you choose should function as an extension of your department and your company. Selecting an RMC that designs a program in your company’s best interest ensures you remain a competitive, compliant, and cost-conscious employer.

For more information on how WHR Group can take your relocation program to the next level, call us at 800-523-3318 or email contactus@whrg.com.

5 Corporate Relocation Trends to Keep an Eye On | Q4 2023

Employee Relocation Abstract globe focusing on North America illustration Ai generat

Here are 5 corporate relocation trends WHR Global is keeping an eye on for Q4 and beyond!

Global Housing Costs

Verdict: ↑ Varied ↓

Whether purchasing or renting around the world, global housing costs are expensive, but the past 12 months have been inconsistent. Within the corporate relocation industry, it’s important to keep an ear to the ground in key hubs of economic activity so organizations know when to adjust housing allowances, begin to offer mortgage support for homeowners, or improve the level of support. Below are examples of just a few key economic zones WHR is monitoring closely:

 

  • Germany: Year-over-year (YOY) property price decrease of -4%.
  • Japan: YOY property price increase of 5%.
  • Netherlands: YOY property price decrease of -9%.
  • Singapore: YOY property price increase of 7%.
  • Switzerland: YOY property price increase of 4%.
  • United Arab Emirates: YOY property price increase of 18%.

  • United States:
    • Homebuyers: average 30-year fixed mortgage rate increase from 6.02% (15-Sep-2022) to 7.18% (15-Sep-2023).
    • Boston, MA: median monthly rent increase of 3% YOY from $3,200 USD/month to $3,300 USD/month.
    • Los Angeles, CA: median monthly rent decrease of -8% YOY from $3,195 USD/month to $2,950 USD/month.
    • Houston, TX: median monthly rent remained stagnant with a 0% YOY difference from $1,794 USD/month to $1,795 USD/month.
    • New York, NY: median monthly rent increase of 5% YOY from $3,480 USD/month to $3,664 USD/month.
    • Miami, FL: median monthly rent decrease of -12% YOY from $3,800 USD/month to $3,350 USD/month.

Corporate Relocation in the Netherlands

Verdict: ↑ Trending Up ↑

Thanks to the European Union’s Right to Work and expat-friendly legislation such as the 30% facility, corporate relocation is positioned to trend upwards. For those unfamiliar, the Netherlands 30% facility allows employers to choose to pay their employees 30% of their annual salary tax-free (provided they meet certain baseline conditions). Expats also enjoy geopolitical stability, a consistently high quality of life, and expat-friendly banks such as ABN AMRO.

Netherlands Migration Statistics (2013-2022)

This chart shows immigration, emigration, and net immigration for the Netherlands from 2013-2022.

Immigration
Emigration
Net Migration
20132013 2014 2014 2015 2015 2016 2016 2017 2017 2018 2018 2019 2019 2020 2020 2021 2021 2022 2022Migration to the Netherlands (in 000s)50050040040030030020020010010000-100-100-200-200
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ESG Considerations in Corporate Relocation RFPs

Verdict: ↑ Trending Up ↑

Environmental Social Governance (ESG) is becoming commonplace in most corporate relocation RFPs. As organizations focus on sustainability and ethical practices, these factors play a pivotal role in their vendor selection. ESG compliance aligns with a company’s values, reflecting positively on its brand image.

Choosing corporate relocation services providers committed to these principles demonstrates a commitment to social and environmental responsibility, appealing to both employees and stakeholders. Organizations should seek out corporate relocation serivces providers who value committed action plans such as EcoVadis certifications and Science-Based Targets.

EcoVadis helps organizations manage ESG risk and compliance, meet corporate sustainability goals, and drive impact at scale by guiding the sustainability performance improvement of corporations and their supply chains.

Science-Based Targets help organizations lead the way to a zero-carbon economy, boost innovation and drive sustainable growth by setting ambitious, science-based emissions reduction targets. 

Air Shipments in Corporate Relocation

Verdict: ↓ Slightly Trending Down ↓

As detailed in our article, “ESG in Global Mobility: Turning the Tide on Air Shipments,” there are significant ESG advantages to reducing or eliminating air shipments. Air shipments have long been the go-to choice for international relocations and corporate moves due to their speed and efficiency. However, the environmental impact of air cargo emissions cannot be overlooked. As a greener alternative, sea container shipments present a compelling case for global mobility programs to transition towards more eco-friendly transportation modes.

To compare typical CO2 emissions between modes of transport (measured in grams of CO2 per metric ton of goods shipped per mile): flights emit 500 grams of CO2/metric ton of cargo per kilometer of transportation. However, ships emit only between 10 to 40 grams of CO2 per kilometer.

Communicate the difference in CO2 emissions between air, road, and sea shipments. Your employees may self-select a more eco-friendly option (if feasible), sending fewer items in their air shipments or not utilizing them at all. Or, instead of an LDN air shipment container which has a weight capacity of 750 lbs, consider reducing this entitlement to a D air shipment container which has a weight capacity of approximately 500 lbs.

Implement programs such as Discard & Donate to reduce shipment sizes, thereby reducing organizational costs and CO2 emissions. Consider offering a cash allowance in lieu of the air shipment, or eliminate the air shipment option altogether.

Global Mobility ESG

Inclusive Language in Employee Relocation Policies

Verdict: ↑ Trending Up ↑

As discussed during various regional relocation council meetings, including WiERC & CRC Chicago, corporations can have a large positive or negative impact on their employees by how their policy language is written. Writing a definition for family size, as an example, can have large downstream impacts if a family member feels excluded.

Here are some of the considerations employers should take into account when defining family size in their relocation policies:

  • Is your definition for family size consistent across all HR policies?
  • Is your relocation policy inclusive of same-sex relationships?
  • Should dependent children be limited to 18-years-old and younger? Or should dependent children include those up to 21-years-old if they’re still attending school?
  • Should your relocation policy include or exclude elderly dependents? If elderly dependents are included, this could have immigration complications.
Family moving home

Conclusion

In summary, the corporate relocation landscape is undergoing significant shifts, and WHR Global is diligently monitoring these trends for Q4 and beyond. The global housing market presents a complex and varied picture, emphasizing the need for organizations to remain adaptable and responsive in adjusting housing allowances and support mechanisms. The Netherlands emerges as a promising destination for corporate relocation, thanks to favorable legislation and expat-friendly policies. Additionally, the rise of Environmental Social Governance (ESG) considerations in relocation requests for proposals (RFPs) underscores the growing importance of sustainability and ethical practices. Finally, the focus on inclusive language in employee relocation policies highlights the impact that thoughtful policy design can have on employees’ well-being and satisfaction. As the corporate relocation landscape evolves, staying informed and embracing these trends will be crucial for organizations seeking to navigate this dynamic environment successfully.

What is COLA (Cost of Living Adjustment)?

Cost of Living Adjustment (COLA) is a crucial aspect corporations consider when relocating employees or hiring talent from different geographical regions.  What is COLA? COLAs are payments designed to compensate employees for the higher cost of living they encounter in their new destination. Learn more about calculating cost of living adjustments, definition, and factors in cola payments.

Understanding Cost of Living Adjustment (COLA)

Cost of Living Allowances or Adjustments, commonly known as COLA, serve a common purpose: to bridge the gap between the cost of living in a low or moderate region and that in a higher-cost location. The employer compensates the employee based on housing, goods and services, and taxes, enabling them to maintain the same standard of living in their new area. This is the purest definition of a cola, but many nuances go into the calculation.

Calculating Cost of Living Adjustment

An accurate calculation is the foundation of a fair cost of living adjustment. Several providers offer services to calculate housing costs, goods, services, and other factors to determine the standard. The origination city’s cost index is then compared to the new town’s to identify the cost difference. Many employers have a limited number of potential locations for employee relocations, making it easier to assess cost indexes. Employers may also compare entire regions instead of individual cities for easy calculation. WHR can help our clients understand the COLA formula and make the best decision.

Factors in Calculating COLA

Employers must decide under what conditions they will offer a cost-of-living adjustment. The percentage of change in the cost of living between the locations is a critical factor in determining COLA. The question becomes, what is a standard cost of living raise? Some employers may require a cost-of-living shift greater than 3%, 5%, or 10% to provide the COLA. Those aiming to offer more generous benefits may set a lower threshold for cost-of-living changes to benefit a more significant number of employees. Every employer will determine their COLA benefits differently. The cost of living adjustment will also vary by employee and, of course, location. Many of these are case-by-case situations for COLA payments.

Duration and Payment of COLA

Once a COLA is determined to be provided, the next consideration is the duration and payment method. Traditionally, U.S. domestic COLAs are calculated once and paid as a lump sum allowance or distributed over a specified period. Companies may maintain the adjustment for an extended period to allow employees more time to adapt to their new location.

 On the other hand, international COLAs are recommended to be recalculated more frequently due to fluctuating currency rates, inflation, and other uncontrollable factors. For international assignments with pre-determined end dates, companies often offer the cost of living adjustment for the entire duration. However, if the assignment is open-ended, the company may transition the employee to the local standard of living (localizing) and discontinue the COLA after a set period.

Importance of Benchmarking

Relocation benefits can vary significantly across industries. Therefore, benchmarking your organization’s COLA policy against peers is crucial. Some industries may offer more frequent and generous COLAs, while others may not consider it at all. Understanding these variations can help determine whether a COLA adjustment or increase is needed. Ultimately, it can help you tailor your policy to meet your organization’s needs. The last piece to consider in benchmarking is understanding market rates in target relocation areas.

Conclusion

Cost of Living Adjustment is a vital tool/formula corporations use to ensure their employees can maintain the same standard of living when relocating to higher-cost locations. Companies can design worker compensation and relocation packages that attract and retain top talent by understanding the factors involved in calculating COLA and benchmarking against industry peers.

Improve your COLA benefits with our Allowances & Per Diems Benchmark.