Relocation Policies: To Tier or Not to Tier
In answering Cartus’ 2014 Global Policy and Practices survey, 75% of respondents stated that their organization is seeing a demand for greater flexibility from their mobility programs. When asked what is driving the need for more flexible approaches, the leading survey responses were ‘budget constraints/economic climate’ at 67%; ‘changing employee needs’ (including family, spouse and elder care) at 44%; and ‘attracting qualified candidates’ and ‘emerging markets’ (housing, schools, etc.), which both came in at 40% of respondents. So, what are companies doing to meet the needs of their employees?
Meeting the Need for Relocation Program Flexibility
When asked what their organization is doing in response to requests for more flexibility in their program, 39% said that they are moving to policy tiering in response. What is tiering, and how can it help your organization? Through tiering, companies can customize their policy benefits to specific employee level or function, achieving cost control and minimizing exceptions through standardization while still assuring the appropriate levels of support.
Companies have begun dissecting their mobility programs and are delineating their policies by more clearly defined eligibility criteria. The objectives of the assignment, the employee’s role, employee level, or band level, as well as overall rationale for the global transfer, are being used to determine which tier or policy level will apply to each individual.
Tiering may assist with the unique generational differences that now exist in the workforce (e.g., Baby Boomers, Gen X’ers, and Millennials). While companies are certainly not tiering their policies solely to address the various generations, organizations need to be aware of the obvious generational nuances that add complexity to global mobility. Companies that have had one global long-term policy and have been applying the same benefits to their entire long-term population are finding that they have varying business or mobility objectives and employees at different levels who are now accepting long-term assignments or are self-selecting a relocation as a way to stay with an organization while moving to a location of his or her choice. In some cases, they are finding that many of the benefits are far too rich for certain employees. On the other hand, there is still the ”traditional” expatriate, likely a senior manager with tenure, who is a good fit for a full expatriate benefit package. This is where tiering can come into play.
Tiering: Will it Work for You?
Tiering can deliver on organizational goals by targeting benefits not only to level, but to assignment purpose as well. Read our full Mobility Insights for more details on tiering and how it may work for you. You can also watch our short video on tiering to find out how companies should begin an initial evaluation of their current mobility program by identifying strategic business drivers, general assignment objectives, and key assignee demographics.
If you have questions on tiering, please contact your Cartus representative or email us at ConsultingSolutions@Cartus.com.