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Frequent Business Travelers/Commuter Assignments: A Practical Guide

Commuter assignments likely to accelerate in the Post-COVID world.  Are You Ready?

30 March 2020

Among the most significant developments in the growing “flexibility” trend is the increased focus on Extended Business Travel (EBT) and Commuter assignments as a formal part of the global mobility policy portfolio. Agile companies are seeking to meet the challenges of rapidly evolving work patterns, the greater demand for flexibility, and to overcome personal barriers such as family reluctance to move, dual career concerns and assignments to difficult locations

Bristol expects this trend to continue in the post-COVID world and indeed see even greater utilization.  Is your company anticipating a need for more flexibility?  Do you have policy guidelines in place?  Now may be a good time to plan and develop your approach.

BENCHMARKING:  WHAT ARE OTHER COMPANIES DOING? 

The first step is to learn from others. There is a body of knowledge on the topic but detailed survey data may be hard to come by for several reasons including that business travel is often not handled by Mobility departments.  Such arrangements often “fly under the radar” of Global Mobility as conventional business trips are often extended on an ad-hoc basis by the business unit in charge.  So common is this occurrence that our industry often refers to them as “stealth” or “accidental” expats among other things.  Therefore, the main issues surrounding EBTs / FBTs are immigration, tax compliance and tracking because “accidental” assignments can have serious consequences for the business. 

EBT policy may also be difficult to define as the boundaries are often blurred among a variety of short-term, project, commuter, rotational and business travel arrangements. Further, imposing a strict EBT policy may be disconnected from real case-by-case conditions and not provide the flexibility or exceptions that must be granted in order to meet them.  Case-by-case solutions are frequently negotiated outside of these policies. 

However, we believe a structured outline CAN be achieved as an effective guide to communicate throughout the business and ensure a high degree of consistency and compliance.  As discussed in greater detail below, the policy elements themselves are fairly straightforward, typically covering travel, lodging, meals, and transportation including frequency of return.  Most important in Bristol’s view is a strong organizational commitment to tracking, compliance and communication.

DEFINITIONS:  THREE BROAD CATEGORIES

EBT policies are often grouped as a subset of short-term assignment (STA) policy with which they share many attributes:

Extended Business Trip (EBT):  Single host location, single trip.  Duration up to 3 months (shy of formal STA threshold).  Not often managed by Mobility Departments.

Frequent Business Travelers (FBT): Single or multiple locations, multiple trips. Employee remains based in home country but travels frequently to foreign work destination(s). Can be considered “virtual assignees” when doing the same type of work as an STA.  Often used as alternative to STA/LTA if the employee/family is resistant to relocation.

Commuters:  Employees who commute every week or two  (or some other schedule) to one or several foreign work locations while maintaining home country residence.  Also used as alternative to STA/LTA if the EE/family is resistant to relocation.

FORMULATING AN APPROACH - MANAGEMENT ISSUES

As you seek to establish a policy framework we suggest you begin by asking the following questions of all stakeholders throughout the organization:

Feasibility / Eligibility:  Will EBT / Commuter arrangements work for our company?  For what types of roles?  For what destination and origin locations?  What are the factors (e.g. distance from home) that would trigger an EBT policy vs. our standard LTA/STA? 

Ownership of EBT/FBTs.  Will Global Mobility manage Commuter and Business Travel assignments?  Or will business units manage them with advice and counsel from GM?  Confirm this throughout the business.  Stress the importance (or mandate) of consultation with GM.

Business reasons.  What is driving the case for a business traveler vs. a short-term or long-term assignee?  Remember that EBT’s are not always cheaper than standard STAs.  Are they used as an alternative to overcome case-by-case resistance to STA/LTA, or is the business need simply better met by an EBT at times?  We recommend that Global Mobility require a formal business case and produce a cost projection for each proposed assignment.

Compliance and Tracking:  EBTs present a number of challenges ranging from tax, immigration and security to cost. We know for example that tax compliance is more complex than just the “180 day rule” and that companies are often held responsible for employee non-compliance even if the contract or LOU states employee responsibility.  The number of days spent in each country must be monitored along with myriad individual country tax statutes.

Compounding the problem: the often siloed tax, immigration, finance, and HR teams along with multiple non-integrated technology systems can severely hamper the effort to unify global coordination and tracking. We suggest that GM can take the lead in pulling together these teams and processes while also advising in setting the terms and conditions of each package and managing consultation with external experts.

What about the employee?  Remember that the ultimate focus is on the safety, well-being and productivity of the associate.  EBTs can be as problematic as traditional expat assignments… or even more so.  Be aware that family issues are paramount.  Be mindful of the stresses of frequent absences and separation along with the grueling travel schedules.  Consider flexibility and enhanced support.  Frequency of home visitation is a key provision.  Take “Duty of Care” seriously!

FORMULATING AN APPROACH - POLICY CHECKLIST

We suggest you establish guidelines for the following typical provisions.  

We hope this provides a useful outline!  Bristol welcomes the opportunity to provide you with company-specific guidance, advice, benchmarking and process assistance.  Please reach out to Martin (mfoxwell@bristolglobal.com), your Bristol account director, or contact us at info@bristolglobal.com.

 

 

 

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