With global relocation becoming the new normal, millions of professionals take up different assignments and relocate annually. Mobility is proving to be the cornerstone for business expansion and increasing revenue. Business owners must understand that there are a range of issues, mental and physical, that an expatriate is likely to encounter with a relocation. This is where the duty of care, the common longstanding principal law, comes into play. It can be defined as the company’s obligation towards its employees to protect health and safety. Hence, the duty of care must be incorporated into an employee relocation policy. The policy should consider warranting the welfare not only of the employee, but also their family throughout the relocation and new location assignment.

When health insurance is portable within the home country, the employer must ensure the employee and the family get all the current benefits in the new location. Since healthcare coverage and systems vary not only from country to country but from region to region, it is the employer’s job to make sure that the employee has global healthcare coverage. The employer should ensure benefits in the coverage area are in place before the transferee arrives at the job location. It is also essential to have a policy that includes medical evacuation services when required. 

Another thing to consider is the treatment for mental health. According to psychologists, the relocation process is ranked as one of the top stressful events in someone’s life. Part of the duty of care is to provide mental health coverage, and companies should acknowledge the inherent stress. Many companies provide an Employee Assistance Plan (EAPs). These plans provide the employee a great mental health resource.

Benefits of Duty of Care in Relocation Policy

When you have a proper duty of care instated within the employee relocation policy, it will help your employees and the development of your business. Here are some reasons why the duty of care in employee relocation is necessary. 

Attracting and Retaining the Right Talent

Irrespective of the industry you are operating in, you always want to have the best employees for your business. Since talent doesn’t always reside locally, you must provide the right relocation policy to attract and retain talent.

Getting the Right Support from the Right Places

When you have a duty of care within the employee relocation policy, you will be warranting that the employee gets all the right support from the HR department and other suppliers who are part of your relocation policies. This may include many types of providers who will provide information about schools for children, finding the right home in the new location, selling a home in the old location, in addition to many other services. 

Ensuring Fairness

One of the biggest hassles that employee relocation managers and businesses face are different relocation benefits among the same grade of employees. This is exacerbated when there is not a relocation policy in place. A proper relocation policy and duty of care outline the support and benefits that an employee is supposed to have during and after the location to a particular place. 

Cost Control

The last thing you want as an employer is to throw away money for lack of a relocation policy, or for your company to get embroiled in a legal battle with an employee for not taking care of them. When you have a relocation policy along with the duty of care, you will keep your employees happy and benefit from cost-effective relocations.  

Contact us to discuss creating or reviewing your current relocation policy.

A recent study conducted by IBIS World stated that in the last five years, the Employee Relocation Industry has had a growth of $13.9 billion, which is at 0.4 percent annually. It is believed that the impetus for this growth is due to the rising economy and corporate profit. The other factor that boosted the Employee Relocation Industry is the housing market’s positive trend in the last few years. A substantial share of the revenue for the Employee Relocation Industry is generated from the real estate market.

As a result, the study concluded that in 2021 alone, the growth in the economy and house pricing index likely contributed to about a 7.8 percent increase in the Employee Relocation Industry. Unfortunately, this improvement came at a time when the industry is immensely affected due to the COVID-19 pandemic. 

While some employees refused to relocate due to health issues, and with a drastic loss of employment in parts of 2020 and 2021, the Employee Relocation Industry suffered. But with work-life coming back to normal, the relocation of employees is picking up. Furthermore, with the new trend of the Great Resignation, companies and employers are looking to hire talent beyond domestic boundaries. However, the incentive offered to talent doesn’t end here. The existing employees can rise vertically or horizontally within the company to ensure they are retained. 

In such a scenario, where real estate plays an important part in relocation, we need to see how it affects an employee. In many situations, the employee needs to sell a property before relocation and/or purchase a new property in the new location. In this article, we will investigate the effects real estate has on the relocation of an employee and how an employer can help. 

Perspective of an Employee 

For many employees, buying and/or selling their house is critical for relocation, hence understanding their experience would help the employer to prepare and offer a better relocation outcome. 

Low-Inventory and High Prices 

Across the country, many home buyers are facing difficulty with purchases because of the record-high prices in the real estate market. While that bodes well with any employee selling the house for relocation, there is another issue. When the same employee searches for the house in their new destination, they are looking at a price that can be higher than expected. They can also be in the situation of losing out on multiple bids or they may feel rushed to buy an overpriced property. Given such a situation, there are ways the employer can help the relocating employee. 

Employer Can Help to Relocate an Employee 

If you are still wondering why there should be a relocation program for the current real estate market, the answer is simple. The last thing you would want is for your employee to leave your company because of a tough home purchase experience. Furthermore, without a mobility or relocation program in place, you are in the position to lose out on more money. You may lose time, for example, if the employee is outbid by others for a new home, thus delaying their relocation time. You also might receive more exception requests, for example, if the person is moving into an expensive real estate market.  

So, how can an employer help an employee with the relocation program? 

Extending the Corporate Housing Benefits 

If you already don’t have one, you should provide your employee with corporate housing benefits. In case you already have the benefit in place, it is time to extend the benefit longer. Corporate housing offers the transferee a short stay in fully furnished accommodations until they find a new place to call home. But this stay cannot be for an indefinite period. With relocating employees having a hard time finding a house in this real estate market, extending the stay should be an option when applied for by the employee. 

Extending the Timeline 

The high-priced real estate market, with delayed enclosures, travel bans, and the introduction of an air-bubble due to the pandemic resulted in employees failing to utilize the relocation policy within the stipulated time. As a result, some people failed to relocate within the required timeline and had to forgo the benefits. Employers should evaluate existing relocation policies. The impetus is on employers is to identify the areas where they can extend timelines and offer the benefits to the relocated employee, mainly when it comes to real estate. 

Final Words 

One of the best ways to execute an employee relocation assistance program is to work with an experienced Relocation Management Company (RMC). An RMC can help your employees with relocating, finding the right house/closing, plus the many other steps needed in an employee’s relocation. An RMC can also design a cost-effective relocation policy that serves transferees’ needs while still saving your company money.