The loss of workplace productivity during an employee’s corporate relocation, although difficult to measure, is both real and significant, especially given the growth in global mobility. The relocation process by definition creates substantial distraction and dissonance, reducing the employee’s focus and engagement, and ultimately, productivity. There are, however, several things that can be done from the company’s perspective that can assist in lessening the reduction of productivity problem when working with employee relocation. Read More
Category: U.S. Relocation
Too often, a company identifies an ideal candidate for a role that will require employee relocation and then communicates only with the candidate about the potential relocation. Ironically, the accompanying spouse/partner and family often endure the brunt of the move. Read More
In developing specifications for a new, outsourced provider, it is best to begin with an evaluation of your current employee mobility process and policies, and a frank assessment of how well they meet the needs of your internal customers (recruiters, managers and relocating employees). You will probably identify aspects that are working well, and that you want the outsourced provider to continue, and others that could be better. Documenting and clearly articulating your needs, expectations and goals will make it easier to evaluate relocation companies and to determine the parameters of the outsourced program. Read More
In the past, many companies relocated employees only occasionally. Typically, these relocations included limited benefits and a narrow range of locations, so it was relatively simple to administer the program and manage a small group of local suppliers in house. Today, global relocation brings so many program, tax and legal considerations that outside expertise is an essential component of administering successful domestic relocation and international relocation packages. Outsourcing global relocation can bring companies several benefits:
Specialized Executive Relocation Expertise
The specialized expertise of full-service relocation management companies is a key reason that companies outsource. Relocation management companies like TRC Global Mobility offer a complete suite of executive relocation services and broad geographic coverage. Experienced relocation providers bring policy consulting expertise and knowledge of relocation best practices and tax and legal requirements. This expertise can help companies to ensure their policy is as competitive and cost-effective as possible—and create time for the company to focus on core business priorities. Read More
Worldwide ERC just issued the following statement regarding the Supreme Court’s decision to allow a partial travel ban to take effect.
Arlington, VA— On June 26, the U.S. Supreme Court issued an unsigned order to allow the implementation of parts of an executive order signed by President Trump to temporarily suspend foreign nationals from six countries from entering the U.S. Based on the facts of the case, the Court formed a distinction between nationals who have “a bona fide relationship with a person or entity in the United States” and all other foreign nationals. The Court upheld the suspension of the ban for foreign nationals who have such a relationship, including individuals employed by a company in the U.S. Read More
Because the tax aspect of any relocation is so important, clear and continual communication with the transferring employee is essential. A transferee should never be surprised at tax time with a large and unexpected payment due to the IRS. It is the responsibility of the transferring employee to understand the tax implications of each relocation benefit, but it is incumbent upon the employer and the Relocation Management Company (if one is involved in the process) to ensure that the tax implications of benefit usage are fully explained to the transferee verbally and in writing. Read More
To facilitate a relocation, many employers offer home selling assistance to homeowner transferees. Home sale assistance can come in various forms; however, the IRS specifically calls out the Amended Value (AV) program as the favored method in terms of compliance.
An AV program allows the transferee to market the property and attempt to find a buyer before the employer acquires the property and takes it into inventory. If the transferee finds a buyer, he sells the home to a third party Relocation Management Company (RMC) for the agreed-upon price, and the RMC, in a second and separate transaction, sells the property to the buyer for the same price.
Arguably, the most complicated discussions surrounding domestic relocations involve the tax piece. For any domestic relocation expenses to be qualified as tax deductible, there are a few requirements that must be met, including:
- The move must correlate with the start date at a new job location
- The employee must be employed full time for 39 weeks during the 12-month period following the first day of work in the new location
- The new place of work must be 50 miles farther than the commute from the old residence to the old place of work
- The expenses must have been incurred due to the move
- Only reasonable expenses are deductible
- There is no limit on the dollar amount of deductible expenses
For years, comprehensive immigration reform has moved through the U.S. House and Senate in stops and starts. The new administration has signaled a more aggressive stance on immigration right out of the gate, and Congress is expected to take up comprehensive immigration reform once again. In the meantime, a great deal of uncertainty will cloud the process for companies and candidates alike.
Talent knows no borders.