U.S. TAX REFORM: Companies based in the U.S. or with significant U.S. operations are right now carefully considering the effects of the 2018 Tax Cuts and Jobs Act. Bristol is acting in an advisory capacity, assessing the cost and budgeting impact of the new regulations, and collaborating with our clients on solutions. Total program impact is ranging from 10-20% cost increases compared to 2017 given similar projected volumes. Many companies are absorbing these costs in support of their transferees, which in the spirit of “keeping them whole” would seem the fairest approach. Others are seeking ways to perhaps share the cost burden with the transferee, or making offsetting adjustments in other areas of policy. For example, companies who may address benefits such as household goods shipment, storage and/or final move expenses in a lump sum may need to reconsider and recalculate those allowances.
Related, communications to transferees and policy documents are needing to be modified. Internal education of senior management and business units regarding budgeting and policy adjustment is critical, and now taking place, often with Bristol’s support. This will be an ongoing process in 2018 and beyond, as we consider policy review to be a perpetual cycle of assessment and adjustment.
POLICY FLEXIBILITY: The trend towards segmenting or tiering policies away from “one size fits all” continues. Companies are exploring, defining and clarifying their policies which may be tiered according to, for example: job level, homeowner/renter, purpose of assignment, duration of assignment, regional and location specific policies, etc. These segments are designed to match the specific benefits to the situation and to better serve the needs of the business. Bristol is assisting our clients in understanding these trends and diagnosing how they may fit with each client’s unique culture and business circumstances. Some innovative tiered policies are now including, for example, a variety of lump sum and managed budget options, a la carte and core/flex.
MILENNIALS AND EARLY CAREER TRANSFEREES: Companies are considering whether the new generation of transferee truly has different motivations, needs, and expectations for relocation policies or not. There are some indications and certainly much discussion of a possible paradigm shift underway towards more flexibility (as described above) and specific policy re-designs including lump sum, a la carte, core/flex, and self-service models. Consideration of these options for the new generation of transferee may address a company’s desire for quality improvements AND reduced costs.
GROWING BARRIERS TO RELOCATION: Prevailing wisdom has held for years that relocation volume is expanding, that mobility is a natural and accepted evolution of global business and the “world becoming smaller”, and that a relocation opportunity often leads to career enhancement, upward mobility and promotion. Whether this is true or not has a direct bearing on a company’s relocation policies. Generally, incentives and support may be less necessary if people are “lining up” for relocation opportunities that represent career growth. But are they? Depending on various factors including company culture, industry, destination locations, types of transferees, nature of assignments, etc. Bristol would note that in 2017/2018, there are growing indications of a certain reluctance to relocate within a large segment of the population due to such factors as an overall rise in global anxiety, the political climate around immigration and foreign workers, and myriad personal factors, including expanded opportunities to work at home or within the “gig” economy that may hold back candidates from wanting or needing to relocate. As a result, some companies are considering the tensions inherent in a need to reduce costs versus a need to attract, incentivize, and retain top mobile talent. In Bristol’s view, the ideal solution is a proper balance that considers business needs versus the demands of the talent pool, and that will differ from company to company.
EXPANDED ASSIGNMENT TYPES: Linked to the points described above, companies are exploring creative solutions in expanding the options that may be available in order to “get the job done” while accommodating the flexible needs of the mobile workforce, including implementing non-traditional assignment types including Extended business traveler, Short-term assignments, “Gig” Workers, Remote, and Commuter options.
BREXIT: The U.K is approximately one year away from the deadline to dissolve its membership in the European Union. Companies are urged to begin preparations for any associated impact on their mobility programs. Perhaps begin by taking stock of your current expat population in Great Britain, their individual immigration status, expected assignment duration, etc. Expectations are for added bureaucracies and delays in services such as HHG shipments and immigration processing. But it is early days yet and much is uncertain. Bristol has begun these conversations with our clients, and further, we are planning a series of client roundtable meetings in the U.K in order to enable companies to brainstorm together on this and other international mobility issues. Bristol will report on BREXIT developments and advise our clients on recommended actions throughout 2018.
Do any of these observations ring true with you? Bristol would love to hear from you and work with you to re-evaluate your policies! Reach out to your Account Manager to discuss, or contact us at email@example.com.