The sudden arrival of COVID-19 turned the world of global mobility strategy and management upside down. Assignees and their families did not want to be away from their home country and loved ones, and some found themselves in particularly dangerous hot zones. Rules and restrictions changed by the day, and some countries locked down completely.
Companies considered their duty of care responsibilities, reacting as quickly as they could to repatriate employees and families under trying circumstances and ensure those who stayed in the host country were as safe as possible. They relied on their relocation management companies and the RMC’s destination service partners, moving companies, immigration partners and more, many of whom put forth a herculean effort to get the assignees home quickly and safely.
After this flurry of repatriation activity, most U.S. domestic and international relocation activities came to a grinding halt. Assignments ceased or took on a new, virtual form. As an industry dependent on the movement of people, the global mobility community struggled as shelter-in-place and quarantine restrictions, along with border closures, confined all but essential workers.
Since those frightening early days, the global economy has recovered more quickly than initially feared. Relocation activity has resumed, but it will be some time before we see the volume of assignments and permanent transfers prevalent pre-COVID.
In addition to employee relocation volume, COVID will have lasting effects on global mobility strategy and policy. The pandemic accelerated several trends already underway; in some cases, theoretical “some-day” changes have arrived. It also introduced new ways for companies to achieve their global mobility objectives. All of this makes it an excellent time to consider these changes and trends and ensure your program remains modern and competitive.
Global Mobility Strategy Trends
With the workforce dispersed, face-to-face meetings, once considered essential, gave way to collaboration technology like Zoom and Microsoft® Teams. These technologies are not new, but they evolved from curiosities to ubiquitous amazingly quickly. They allowed global business to resume virtually. Many expatriates could continue their assignments from their home country or a remote location in the host country if they remained there.
This arrangement has been so successful that many companies are considering virtual assignments as a more permanent replacement for onsite assignments. Working simultaneously across time zones has never been easier, and companies are finding that, with the support of appropriate technology, it might not always be necessary to send an employee on assignment. The potential cost savings are apparent.
When companies do send employees abroad, they have long discussed the need to keep track of their whereabouts, not for nefarious reasons but to fulfill their duty of care responsibilities and remain immigration- and tax-compliant. Yet, according to Mercer’s 2020 Worldwide Survey of International Assignment Policies and Practices, only 60 percent of companies that deploy talent overseas have an employee tracking process in place. The pandemic was a wake-up call for many companies, forcing them to address shortcomings in their tracking capabilities.
We expect many more organizations to leverage relocation technology for their global mobility tracking, program administration, and data management/security and streamline administrative tasks, such as quantifying assignment costs and tax calculations.
Work from Anywhere
The “work from anywhere” model that has gained traction throughout the pandemic will have a lasting impact on all facets of employment. Quickly improvised home workplaces evolved into more accommodating and permanent set-ups once companies postponed returning to the office indefinitely. Eventually, it became clear that many workers might never go back to the office.
As employees moved beyond standby mode, many questioned the future of the Monday through Friday commute to a brick-and-mortar office location. If an employee is tied to a specific office location but does not have to be present in the office, the options for where to live become wide open. If one can work from home in New York, can home be a less costly place like Kansas City? Or a more exotic place like Bangkok? The continuing talent shortage has given workers more leverage to push the location envelope. Employees are emboldened to ask permission to move—or to relocate themselves and assume approval.
Of course, none of this is as simple as it sounds. Employees who choose to move unbeknown to their employers could assume considerable risk for themselves and their company. If an employee works from another country without approval, immigration, tax and employment law issues can permanently jeopardize a company’s ability to do business there.
The Rise of Flexpatriates
Another trend accelerated by the pandemic is the “flexpatriate.” Flexpatriates include global commuters, those on international rotations, extended business travelers and now workers who perform international work virtually.
Short-term trips abroad and virtual assignments are cheaper and more straightforward for companies and workers alike. As a result, we expect more companies to add or expand existing flexpatriate programs. However, we do not expect most companies to abandon more traditional international assignments or permanent moves anytime soon. While companies traditionally reserved these assignments for high-potential and high-performing talent, many younger employees actively seek international experiences for personal and professional development. Flexpatriate programs are likely to be just one part of an organization’s global mobility strategy.
Core-Flex Policies Finally Might Have Arrived
With such a competitive market for talent, companies are keen to create a positive employee experience while maintaining equity and controlling costs. Core-flex programs offer a potential solution. In this model, all international assignees receive certain core benefits. Beyond this, they can choose flex benefits to suit their needs up to a maximum budgeted amount.
Core flex policies have been the next hot trend for years, yet in a 2020 AirInc study, only 14 percent of the surveyed organizations used a core-flex global policy model for any of their moves. However, an additional 36 percent of companies were considering core-flex options. In a similar study conducted by KPMG, 74 percent of companies surveyed had a core-flex program in place or were considering this option.
The Synergy of Talent Management and Talent Mobility
Global talent management teams and their global mobility counterparts continue to work more closely together. This collaboration has fostered more purposeful and strategic partnerships with stakeholders throughout their organization. The result is greater understanding and support of the critical role of talent and mobility professionals in achieving overall business goals. Some key areas of collaboration include:
The pandemic has not diminished the continuing talent shortage that companies face. Aligning the organization’s mobility program with its overall talent objectives is critical for future success. Obstacles to cross-border moves have made companies source talent locally if possible (local nationals and foreign nationals who are already in-country). However, the easing of the pandemic and related restrictions is creating the potential to recruit from areas that may not have been feasible before.
Diversity, Equity and Inclusion (DEI)
Corporate diversity, equity and inclusion initiatives have also raised awareness that minority populations have traditionally been under-represented in global mobility, both as leaders and as international assignees. As a result, global talent recruiters find that organizations are paying more attention to diversity issues within their global mobility strategy.
Environmental, Social and Governance Goals and Practices
More companies are committing to environmental, social and governance (ESG) goals and practices because they believe this is the right thing to do, because shareholders, clients, employees and other stakeholders demand it or both. Specific company actions and initiatives to support ESG can touch both talent management and talent mobility. An obvious example would be more careful consideration and management of corporate travel.
Local tax and immigration authorities are well aware of the remote work trend (this applies to U.S. states too). Some jurisdictions exercised limited forbearance during the early part of the pandemic, but they can be expected to monitor compliance and enforce regulations going forward. Corporations can get into considerable trouble if they fail to monitor and manage their employees’ work locations.
As borders continue to open, more employees may ask for relocation assistance. Or they will simply make a move on their own with the continued expectation of being a remote worker from an international location. Companies will need policies and procedures that distinguish remote workers from traditional international assignees to mitigate the risks of unmanaged moves.
Talent management and talent mobility are partnering to support the employees while protecting and advancing the needs of the business. These initiatives can include establishing a program framework for the international remote worker. If done correctly, this could provide a satisfying experience for the employee, further the company’s business objectives and manage risk for the business.
Learn more about the trends in this Global Mobility Strategy whitepaper!
Read this whitepaper on Global Mobility Policy Trends, Design and Best Practices that will help you to assess your global mobility policies in light of current realities.