ResalesRelocating: What To Expect From Your Company
What can a relocating employee expect in terms of assistance when he or she
is asked to move to a new city?
According to the Employee Relocation
Council, standard relocation policy elements are on the increase and
usually include the following elements:
1. Shipping of household goods
This generally includes shipping, packing, unpacking and storage.
2. Temporary living
The majority of coverage is offered for the new location rather than the old.
3. Househunting trips
Over the years, it has become more common for employers to offer multiple
trips. Today, 46 percent of companies cover one trip and 49 percent cover
multiple trips. Most employers offering multiple trips cover two
househunting trips. (*1997)
4. Purchase closing costs
Most companies will reimburse all "normal, required" costs associated with
the purchase of home at the destination location, but generally restrict
coverage to transferees that were homeowners at the old location and/or have
attained certain job levels.
5. Miscellaneous expense allowance
With no requirement to itemize or document expenses, the allowance is
intended to cover incidental expenses related to the move, i.e., auto
registration, appliance hook-ups, etc. It is usually equal to one month"s
salary.
6. Real estate sales assistance
Nearly all companies offer such assistance, under one of the following
programs:
In-house purchase program, where the company offers to buy the home
A third party purchase program, similar to the in-house purchase
program except the company contracts with an outside firm to purchase and
resell the home
Guarantee-against-loss, where the company does not offer to buy the home
but guarantees the market value of the residence (selling expenses are
usually also reimbursed.)
Direct reimbursement, where the company reimburses selling expenses
with no attempt to protect the home"s market value.
The third party program is the primary form of assistance and is used by 70
percent of companies, followed by the direct reimbursement program and
in-house purchase programs, each used by about 10 percent of companies.
About 50% of ERC member companies provide career assistance to transfering
spouses, and another 45% provide assistance to unmarried life partners of the
spouse. Two-thirds offer this assistance through a formal policy, while the
remainder offer it on an employee request basis. Most companies with formal
spouse employment assistance policies make it available to the spouses of all
current employees, regardless of the transferee"s level within the company.
A 1997 ERC survey of its members produced the following breakdown of current
employee relocation costs:
Among current employees, the type of assistance available in 1997 averaged
as follows:
Cost Shipping of Household Goods -$7,311
Federal Tax Liability - $7,185
Purchase Closing Costs - $6,358
Bonuses/incentives given for employee-generated homesales - $4,119
Miscellaneous expense allowance - $4,108
Temporary living at new location - $3,680
Duplicate housing costs - $2,596
Homefinding trips - $1,702
Spouse employment assistance - $1,319
Travel and lodging expenses at the time of move - $1,205
*Averages based on transferees who actually received assistance.
For more information, please contact the The
Employee Relocation Center.