With so many moving parts and unexpected costs, relocating your company is a huge undertaking. The biggest asset in your company- your employees, will experience a lot of stress and you need to pull your weight when it comes to providing them with adequate support.
If you fail to do so, your employees will become unhappy, productivity in the office drops, and you may risk losing them to competitors if they feel that they aren’t appreciated. Keep in mind that employee turnover after a relocation is high so it’s best you mitigate your risks.
In this article, we’ll take a look at a few proactive steps you can take to handle employee relocation.
When you have employees of different life circumstances and tiers, you’ll need to establish a policy guideline to ensure you and your managers are fair when it comes to compensating employees for their effort.
Most companies either go for tiered or lump sum packages.
Tiered packages usually distinguish employees based on their experience in the company and personal circumstances (family, mortgage, etc).
Lump-sum packages allow employees complete freedom to decide on how to spend it. This is suited for companies that don’t have the capacity to manage each employee’s progress.
When it comes to relocation benefits, consider tax implications. Generally, a relocation tax depends on various factors such as salary and location.
Unless you’ve hired a relocation specialist, there’s no way a small team can overlook each employee’s movement and progress. To avoid most of the headaches, you’ll need to create a reasonable timeline that your employees can abide by.
Now, timelines vary a lot from company to company. But for your employee’s sake, do include:
- Move-out and move-in dates
- Preparation for transporting personal belongings
- Submission of all relevant paperwork
- Visits to the new city
Just by having a rough guide, you’ll be instilling some order in your employees and allow them to organize their move better.
The more prepared your employees are to move to a new location, the better off you’ll both be. Give them the freedom to visit the city or town they’ll be moving to. You can offer them paid time off or reimburse their travel and accommodation expenses that includes allowances for their spouse to tag along.
By doing so, you’re letting them familiarize themselves with the city. It helps them fit in better as they have the freedom to look for cultural centers and recreational spots. Naturally, an employee with dependents would want to spend more time or arrange multiple visits. Be generous with your incentives and negotiate accordingly.
It’s common for companies to pay thousands of dollars just to relocate a single employee. These costs will skyrocket depending on the employee’s position in the company and personal commitments.
Should the employee leave the company shortly after the relocation, the company would be at a loss, and have to invest more resources into looking for a replacement. This is when a payback clause comes in handy.
Within this clause, the relocated employee has to pay back part or all of the relocation expenses paid by the company if they were to leave within a set time frame. Typically, it’s between 12-18 months upon relocating.