With the right set of incentives and quality ROI to the employee’s time and effort, it is very much possible to retain said precious human resources. The employee relocation process might be manageable for firms, but it requires a high level of commitment and effort from the employee’s end. In all such cases, while it is not mandatory, however, it is still advised that employers must offer an employee relocation package for a smoother transition and better retention.
What is an Employee Relocation Package?
Before we proceed into the basics of how an employee relocation package must be created, here is a brief glance at these packages.
When a corporation decides to relocate personnel, whether a current employee, a new hire, or an intern, it’s known as employee relocation. Employee relocation is an often-used strategy in the business world. It has the ability to offer various perks such as that y our company’s skill pool will be bolstered as a result, and you’ll have an easier time finding the finest possible employees.
Relocating an employee also entails paying for some or all of the expenses the employee will incur. Relocation payments aren’t required by law, but they might encourage a high-value person (or prospect) to migrate to a new area and help keep with you for the long haul.
Contents of an Employee Relocation Package
According to the findings, incentive schemes may boost employee enthusiasm for their jobs. A 15% boost in performance happens when incentives are initially introduced for finishing a task. Worker’s efficiency rises by 27% when given incentives to stick with a task until it is completed. Performance rises by 26% when “thinking smarter” is rewarded via incentive schemes. This clearly indicates that organizations incorporating employee relocation plans have a higher chance of increased efficiency and retention.
However, the problem then arises regarding the contents of an employee relocation package. Since no individual out there is the same as the next, it can be very hard to gauge the essentials that appeal to the masses. As per research, it has been indicated that there is no hard and fast rule regarding the contents of an employee relocation package. Furthermore, these aspects can differ from one company to the next. Here is a brief look at the most sought-after contents in any relocation package.
Home Purchases and Sales
Suppose an employee’s house does not sell within a certain time. In that case, the employer’s relocating package will help sell the property and make arrangements to purchase a new property in the shifted region.
Legal and financial support in terminating leases or assisting an employee in becoming acceptable for a loan are some benefits that plans may provide. If an employee decides to accept the transfer offer, these perks might be the key. Employers can also offer temporary settlements for the employers to settle in and look for their place in the meanwhile.
The process of relocating from one area to the next can be pretty expensive for the employees. An efficient employee relocation package will cover the basic relocating costs. Employers may reimburse expenses like transportation and moving household belongings.
Some companies do not refund their workers for relocation expenditures but instead pay them beforehand in lump amounts to cover all costs. If there’s money left, employees may retain it or use it to pay for expenditures not covered by the lump payment. A lump amount means that the HR department doesn’t have to worry about negotiating or keeping track of every invoice.
Site Visits for Free
While this one doesn’t have a common occurrence in a common employee relocation package, it is still essential for an easy and smooth transition from one region to the next. Employers and HR departments often include site visits free of cost for the employee to better know themselves in the newer area or job. This helps the employee get to know the area and the familiars themselves.
Support for the Family
When you hire somebody and ask him to relocate nearer to your workplace, be it in another city or country, keep in mind that they most likely have a set of people who rely on your employee for various needs. Families of newly relocated individuals may find it beneficial to assist with the transition. When this is the case, it may also include finding other jobs for a married partner and locating childcare services and a suitable school for the kids.
Costs Allocated for Employee Relocation
The cost allocated for employee relocation can differ from one firm to the next. The employee relocation plan is usually made on the basis of taxes, insurance, travel costs, and short-term housing expenses (if provided). In 2014, firms paid an average of $71,803 to relocate newly recruited householders and $23,766 to relocate newly hired renters, according to an ERC Worldwide study from 2015.
Other factors can weigh into the fluctuation of an employee relocation plan costs—a major player in the housing market. Before making relocation decisions for their employees, firms should be aware of the housing markets. The results for awareness here can be yielded throughout. This is because employees take responsibility for helping with the sales, sometimes cover losses, pay for any temporary living situation, or even offer a permanent residency with charges deducted from salaries.
Moreover, an added cost would be if the employee relocation plan setup process is assigned to third parties’ relocation firms.
The willingness of an employee to uproot their life and relocate for a job can be heightened with an appealing employee relocation package. The above mentioned were some of the elements to include along with the possible costs that can be associated.