The Role of HR in Mitigating the Challenges of Employee Relocation

Can your strategic HR function cover everything required for employee relocation?

Sept 05, 2023

With business agility paramount and international growth the top priority, global enterprises understand employee relocation can become their competitive advantage.

However, employee relocation requires careful thinking. Both businesses and the individual employee need procedures to ensure smooth transitions, productive working conditions, compliance with regulations, appropriate living conditions and adequate compensation — wherever the employee may be moving.

That’s where the HR department comes in.

Introduction: The Modern Landscape of Employee Relocation

Employee relocation, or global mobility, is the trending topic in HR and C-suite circles. Covid-induced downsizing of large office blocks, the efficacy of remote working tools, and appealing growth opportunities in developing markets are all driving conversations about how and where the workforce should be based.

The ability to drive down costs, hire new talent and lay a marker in new countries adds further impetus. Research shows employee relocation budgets are set to rise.

To this end, effective employee relocation procedures have become a business imperative. Companies need policies that ensure no hold-ups on transfer times, unnecessary or hidden costs, no detriment to the employee experience, and, most of all, protection against another ‘great resignation’ from a talented team member.

Globally ambitious companies are now looking to their strategic HR function – and its global mobility partners – to deliver a great employee relocation experience for both the business and the employee.

Why Employee Relocation is a Strategic HR Function

Employee relocation is a ‘people’ issue and falls squarely within the strategic HR function’s remit. Employee relocation’s prime concern is ensuring the right people are well-equipped, well-motivated, and located in the right place to drive results for the business.

Another benefit of a strong employee relocation offering is that it will allow the company to recruit and relocate highly skilled or high-potential candidates from a global rather than a local talent pool. Offering relocation opportunities can help businesses win the war for talent; research shows that up to 70% of new employees expect and want an overseas assignment during their careers.

However, employee relocation will never succeed unless the individual employee is persuaded and willing to make the right move for them and their family.

As always, the strategic HR team will seek to satisfy two parties – individual employees and corporate employers. Whether it’s an existing employee or a new hire relocating for a new role or a worker-requested or company-driven relocation, it’s up to HR to create a satisfying and seamless experience for all involved.

That means clarity on fast-moving, effective procedures for relocation benefits, compensation, housing, immigration procedures, and even schooling or childcare for dependents.

Common Challenges of Employee Relocation

Moving an employee to another location can quickly become a contentious issue. What if the employee doesn’t want to move objects? What if the employee has a young family and needs schooling and other arrangements provided? Or what if the employee is prepared to move but worries about the logistics and financial consequences of a transfer to a new city, state, country or even continent?

Here, we outline some ways the strategic HR function can oil the wheels of employee relocation.

Cultural Adaptation

Any home move or change to working conditions can be fraught with stress. Add the two together, and it’s easy to see how employees could be worried about the move to a new location. Some common concerns might include:

Will my standard of living be the same as where I am now?
Will I have a local support network?
Will I be financially better or worse off due to the move?
Will I be expected to work the same hours?
How long will I be relocated for?
What happens if I cannot speak the local language?
What happens if I lose my job while I’m abroad?
How will I pay for and manage the move?

The strategic HR function’s role is to be a friend and guide during this period. The savvy strategic HR professional will pre-empt questions with clear guidance on compensation, including how the employer will cover housing and moving costs. They will emphasise that full support and training will be made available, including, if necessary, for languages and cultural norms. They should also explain how procedures and partners are in place to ensure things like taxation, immigration, and working visas will be processed on behalf of the employee.

Above all, strategic HR should act as a cheerleader for the relocation, explaining how it will benefit both the individual and the business.

Logistical Hurdles

Even an employee excited at the prospect of a move abroad will have questions and concerns about the relocation process. They will also want clarification on their legal rights concerning relocation.

The strategic HR function will need to address both the perception of and the mechanics of the relocation and to action the processes involved. Sourcing a choice of adequate accommodation will be one potentially time-consuming task, soon followed by ensuring a smooth transfer of employee possessions to their new home or a storage facility. The HR team will need clarity on and to swiftly process compliance tasks like employee immigration status and visa applications, plus, in the case of a new market entry, the local business entity set up or an employer of record arrangement to enable the employee to work legally. Agreeing and paying moving and travel expenses, plus providing family support – for example, spousal immigration status or children’s schooling – will also be pressing priorities.

Compensation will be a key talking point. Will HR incentivise the relocation with a pay rise, promotion or both? How will the employee be covered for moving expenses, for example, via lump-sum, reimbursement or a set budget allocated for direct billing? Will wages be adjusted for the cost-of-living considerations in the new location?

Throughout, the HR function will need to deliver against several objectives: minimising cost to the company, minimising stress for the employee, and ensuring working productivity and no break in business as usual during the transition.

Emotional and Social Challenges

Emotional and social attachments also require attention. Employee relocation worries are rarely insignificant, and it’s in the employer’s interests to ensure their employee feels happy, safe and empowered in their new environment. Isolation can also become an issue, particularly in far-off, unfamiliar destinations.

Fortunately, this is where most HR departments excel. HR personnel tend to be sensitive to individual needs and natural networkers who can create a sense of camaraderie and inclusion amongst their people. Team-building exercises can break down barriers between diverse teams and communicate a shared sense of purpose. A high-performance strategic HR function will also proactively introduce relocating employees to their new colleagues and the new experiences and development opportunities their new location can provide.

Above all, strategic HR functions should offer a dedicated, always-available resource so employees can feel supported and voice concerns about their changing roles.

HR Best Practices for Employee Relocation

Every strategic HR function within a global enterprise should have procedures and parameters for employee relocations. Most of these teams will also have a go-to global mobility partner in place that can smooth the path to relocation by providing clarity on local regulations for tax, immigration and other legal matters — and, if necessary, proactively ensure these issues are covered on behalf of the business and individual.

Processes should also exist for updating employment documentation, managing moving logistics and ensuring a smooth integration with global payroll.

Pre-Relocation Preparation

As with any business project, prior planning prevents poor performance.

It is essential that the employee feels supported and valued during the run-up to relocation. This may include visiting the new location to choose or being reassured about housing and working arrangements. Detailed briefing documents should also be provided, which outline compensation and expense arrangements, working expectations, contract considerations, and supplementary information like advice on local exchange rates and resources such as medical facilities.

Many strategic HR functions will also provide details of potential local mentors or facilitate conversations with colleagues who have already ‘made the move’ to further reassure the employee and their families about the relocation process.

Ongoing Support During Transition

Employee relocation can become confusing and complicated if not planned and executed correctly. HR should aim to remain at least one step ahead of employee concerns, predicting and proactively answering employees’ questions about the process.

A global mobility partner can make this easier by taking on the legwork of form-filling and research to ensure appropriate arrangements are made on the business and employee’s behalf. Flights, accommodation and other possession moving arrangements can all be outsourced, as can visa applications and tax and immigration processes.

By ‘leaning on’ dedicated support, HR personnel can free their time to give employees regular check-ins and updates on progress towards the relocation and a practical, enjoyable onboarding experience.

Post-Relocation Integration

Talent retention is as necessary as talent recruitment, so HR teams should make every effort to ensure relocated employees feel fulfilled, motivated, valued and supported during their period abroad.

Regular check-ins can help, as can feedback sessions between employees and managers. Team events, cultural training including languages and unexpected perks such as local sports tickets can also help to create a feeling of fulfilment and well-being.

Case Study: A Successful HR-Led Employee Relocation

Consider a global company with manufacturing facilities in Europe, the Americas and Asia. They would likely want to transfer best practices from plant to plant and/or bring underperforming factories up to speed. They might even wish to install Industrial Internet of Things (IIoT) capabilities in every facility and, therefore, need to relocate an expert for months to oversee projects.

In this case, effective employee relocation procedures will become crucial. The business will want to identify and relocate an individual into a new factory and, almost certainly, a new country.

Firstly, the strategic HR function will need to address any concerns from the individual. They must review ‘mobility’ clauses in the employee’s contract and act accordingly. Adequate notice periods are a must, too.

The employee will need clarity on compensation, accommodation, travel expenses and working conditions. They might require help with moving possessions, immigration status, and their rights as employees in the new country.

They may also require new skills, for example, local language lessons and/or information about cultural norms in their new location. Briefings on unionised or other working considerations will also be necessary. Clarity over expectations on performance and results will also be essential.

A forward-thinking HR function will have procedures for all these issues. They will have partners in place for sourcing short and medium-term accommodation and, if necessary, education for young children. They will have a one-stop-shop global mobility partner to provide reassurance on tax, legal and immigration issues. They’ll have transparent processes for pre-, during and post-relocation check-ins with the staff member.

Get this right, and the results will speak for themselves: the right person, in the right place, driving the proper business outcomes.

The Future of Employee Relocation and HR’s Evolving Role

As the world becomes smaller, the population becomes more extensive, and new nations develop faster, businesses must become more agile and globally mobile if they wish to compete. A strategic HR function will smooth employee relocation transitions while ensuring ever-increasing access to a global talent pool and a superior employee experience wherever the employee may be located.

Conclusion: HR as the Cornerstone of Successful Employee Relocation

Successful employee relocations can make a difference in company growth, talent acquisition and retention. While relocation issues such as sourcing accommodation, providing appropriate compensation packages and ensuring cultural integration may seem complicated, these can all be covered with planning and a compelling mix of local experts and global mobility partners.

With relocation costs running from thousands to tens of thousands of pounds, doing things right is essential. See https://www.centuroglobal.com/global-mobility/ for how Centuro Global can help you with your strategic HR function and employee relocation needs.