Question:
We only relocate one or two employees in a typical year. Do we really need a formal relocation policy?
MoveCenter Expert:
Yes. In fact, your low relocation volume is one of the reasons to have one.
Companies with large relocation volume naturally develop institutional knowledge. Their HR teams know what benefits they typically provide, what questions employees will ask, how relocation expenses are handled, and where problems tend to occur.
When relocations happen only occasionally, that knowledge is much harder to maintain. Your last relocation may have been two years ago. The person who managed it may have changed roles or left the company. No one remembers exactly what was approved, why an exception was made, whether certain expenses were grossed up, or what was promised to the employee. Then another candidate needs relocation assistance, and HR is starting over.
A written relocation policy gives you the answers before you need them. More importantly, it ensures that even an occasional relocation benefits from a deliberate strategy rather than a series of decisions made as the move unfolds.
Low Volume Doesn’t Mean Low Stakes
If your company is willing to pay to relocate even one employee, there is a business reason for making that investment.
You may be recruiting someone with skills you cannot find locally, moving an experienced employee into a critical role, retaining talent the organization needs elsewhere, developing future leadership, or supporting growth in a new market. In each case, relocation is supporting a talent objective.
Your relocation policy should support that objective, too.
A relocation package can influence whether a candidate accepts an offer or a current employee agrees to move. The right question isn’t simply, “What moving expenses are we willing to pay?” It is what support will make the relocation viable and competitive for the talent you need while appropriately managing the company’s investment.
That is why competitive benchmarking is valuable, but it should be a starting point. What other employers provide matters. What your organization needs its relocation program to accomplish matters more.
Without a Policy, Every Move Becomes a New Negotiation
Without an established policy, routine relocation questions become individual company decisions.
Will you provide home sale assistance? How much temporary housing is covered? Is there a home-finding trip? Which household members are included? Who selects the moving company? Which expenses will be reimbursed or paid directly? Will taxable relocation benefits be grossed up? Who can approve an exception?
Those decisions also create precedent. If one employee receives 60 days of temporary housing, what will a similarly situated employee receive next year? If a hiring manager negotiates an additional benefit to secure a candidate, how will you handle the next request?
A written policy establishes the organization’s position before an individual recruiting situation influences it. HR can still make exceptions when circumstances or business needs justify them, but those decisions are made from an established framework rather than negotiated from scratch.
Relocation Is Also an HR and Compliance Matter
Relocation touches recruiting, compensation, payroll, tax reporting, procurement, employee relations, reimbursement practices, documentation, and commitments made to employees.
A policy defines eligibility, covered benefits, benefit limits, required suppliers, documentation requirements, approval authority, and the process for exceptions. It establishes how expenses will be handled and whether the company will provide tax assistance or gross-up on taxable benefits.
It can also work in conjunction with a repayment agreement when the company requires employees to repay relocation expenses if they voluntarily leave within a specified period.
These issues exist whether you relocate one employee or 1,000. Addressing them before the move helps HR administer comparable situations consistently and reduces the likelihood that important decisions are being made after an employee has incurred an expense or someone has already made a commitment.
One Employee Deserves the Benefit of a Strategy
A company relocating one employee does not need the same program infrastructure as a company relocating 1,000. It does need the same thoughtful approach to determining what the relocation program should accomplish.
A smaller program should be right-sized, not improvised.
That is why MoveCenter provides complimentary relocation policy development and writing for every client, whether you relocate one employee or 1,000.
We don’t simply provide a policy template. We work with you to understand your recruiting and retention objectives, employee populations, competitive environment, corporate culture, budget, internal requirements, and the types of relocations you anticipate. We bring competitive market knowledge and decades of relocation experience to help determine which benefits and program structure best support your objectives while managing your investment responsibly.
The written policy is the result. The real value is having a thoughtful relocation strategy in place before the person you need is ready to move.
