Reflecting on the breadth of information we can share and what truly matters to the Global Mobility community, I recognize that the Global Mobility landscape is constantly changing, one of the reasons I enjoy it so much. This first article focuses on how I have seen it evolve, and, in future editions, I aim to discuss current mobility themes.
Having always been involved in Global Mobility in one way or another, I have witnessed the era of generous expatriate packages. Employees relocating abroad once received substantial support, including schooling, housing, hardship allowances, and expat level cost-of-living adjustments. However, these packages resulted in significant expenses for companies, not just because of payouts but also due to complex tax implications. Additionally, managing such benefits was extremely labour-intensive for employers. Despite their generosity, these packages lacked flexibility.
This led to the creation of various new package models, such as the core-flex system, where employees may use points or assigned budgets. The effectiveness of this approach depends on what is included in the ‘core’ versus ‘flex’ options. For example, I have heard about companies placing tax support in the flex pool, which left some employees not finding this important and not choosing it and this led to penalties for late filings and not understanding what needed to be done. Traditional packages provided certain tax reliefs, but with lump-sum or core-flex arrangements, those advantages were no longer present.
Today, there’s a greater emphasis on one-way relocations, moving away from attempts to keep employees wholly compensated, and instead offering more support as they figure out social security and pension issues across multiple countries. Alongside this shift, companies face the challenges posed by remote work, striving to minimize risk and determine the best structures to ensure fairness across the company.
Short-term assignment and commuter packages have also returned as options, as they typically focus solely on the employee while the family often remains at home. This method enables employers to offer a different set of benefits to the employee that differ from those of traditional assignments.
The Global Mobility function continues to evolve and respond to these new realities. There are countless fascinating topics to explore, and I am eager to start this journey. Some areas I would like to explore include the grey area of the question of work per country, examining different policies and packages, the dilemmas I faced as a Global Mobility Manager, and how Global Mobility works with other HR functions, among many others.
If you have suggestions for additional topics that you feel need to be explored, please let us know at: maria.bouwsma@heartrelo.com