International HR Adviser Autumn 2018 by International HR Adviser

AUTUMN 2018

ISSUE 74

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International HR Adviser The Leading Magazine For International HR Professionals Worldwide

FEATURES INCLUDE: Healthcare: Let’s Get Digital • The Irresistable Mobility Experience • Taxing Issues: A Shrinking World The Future Of Work And The Impact On Global Mobility • A View From The Plane Window: Enhancing The Employee Experience And The Survey Says … Serviced Apartments Reach 1 Million+ Globally • 5 Actions to Enhance Leadership Diversity Is It All About Compliance? Should Global Mobility Professionals Be More Business Minded? The Power of Benchmarking • Global Tax Update

ADVISORY PANEL FOR THIS ISSUE:

The 2018 Global HR Conference FOR GLOBAL HR PROFESSIONALS ONLY

Monday 8th October 2018, from 12.30pm – 5pm The Adelphi Building, Smith & Wollensky, 1-11 John Adam Street, London, WC2N 6HT (very close to Charing Cross & Embankment stations)

Places are limited, so delegates do need to pre-register. Registration takes place from 12.30pm where you can enjoy complimentary refreshments and network with colleagues in the industry, and the first seminar will start at 1.30pm. THE SEMINAR PROGRAMME IS AS FOLLOWS:

Permanent Transfers

The number of "permanent transfers" is on the rise as a proportion of all international moves. Permanent transfers have a higher risk of assignment failure, however, often because considerations beyond simply ‘containing costs’ haven't been adequately addressed. The issues discussed will include: • Trends and challenges • Calculation of salaries and policy on relocation assistance and benefits • Phase out of benefits and allowances • Difference between employee- and company-initiated transfers Sponsored by ECA International and hosted by Lewis Turner

Global Mobility Trends and Tax Update

An overview of Global Mobility trends and an update on current tax issues impacting employers with internationally mobile employees. Sponsored by BDO LLP and hosted by Karen McGrory

How to Implement a Business Traveller Management Programme

Liam Brennan, CEO of the GT Global Tracker will talk on the growing business traveller management issues. We know it is a problem - but what should we do internally to build a business case to implement a programme? Liam will talk about building an internal task force securing buy-in from colleagues in Tax, Payroll, Legal, Immigration, Mobility, Travel and Security – all departments affected by accumulated business travel. Liam will also discuss several different models that can be implemented to monitor this increasingly important sector in Mobility. Sponsored by GT Global Tracker

Immigration Update

This seminar will cover the proposed roll out of the EU Settlement Scheme to support EU nationals and their families, and will include a brief overview of the position in respect of British nationals remaining in the 27 EU member states. Sponsored by Kingsley Napley LLP and hosted by Ilda de Sousa

Global Mobility in an Uncertain World

This seminar will cover Brexit, the rise of nationalism, increased business travel regulations and new areas of growth in global mobility. Sponsored by Santa Fe Relocation

This event is free to attend so if you would like to join us for this educational afternoon please email helen@internationalhradviser.com with the name/s of those who would like to attend, along with their job title and email address. Sponsored by:

CONTENTS

In This Issue 3

Global Mobility: The Future Of Work And The Impact On Global Mobility Santa Fe Relocation

Healthcare: Let’s Get Digital Liam Hughes, Cigna Europe

Is It All About Compliance? Should Global Mobility Professionals Be More Business Minded? Holly Maria Creed, Global Mobility Manager

5 Actions to Enhance Leadership Diversity Lauren Herring, IMPACT Group

The Irresistable Mobility Experience Gethin Hine & Rumi Das, Deloitte’s Global Workforce Practice

Global Tax Update Andrew Bailey, BDO LLP

Taxing Issues: A Shrinking World Andrew Bailey, BDO LLP

A View From The Plane Window – Enhancing The Employee Experience Stuart Jackson, Sterling

What Can GM Technology Offer HR Business Partners? Tim Wells, Equus Software

And The Survey Says … Serviced Apartments Reach 1 Million+ Globally Jo Layton, The Apartment Service

The Challenges of Implementing Global HR Systems and Processes David Regan & Chris Lynn, Squire Patton Boggs

The Power of Benchmarking Emma Holder, The Expat Academy

Diary Dates

Directory

www.internationalhradviser.com HELEN ELLIOTT • Publisher • T: +44 (0) 20 8661 0186 • E: helen@internationalhradviser.com DAMIAN PORTER • Publishing Director • T: +44 (0) 1737 551506 • E: damian@internationalhradviser.com International HR Adviser, PO Box 921, Sutton, SM1 2WB, UK Cover Design by Chris Duggan In Loving Memory of Assunta Mondello While every effort has been made to ensure accuracy of information contained in this issue of “International HR Adviser”, the publishers and Directors of Inkspell Ltd cannot accept responsibility for errors or omissions. Neither the publishers of “International HR Adviser” nor any third parties who provide information for “Expatriate Adviser” magazine, shall have any responsibility for or be liable in respect of the content or the accuracy of the information so provided, or for any errors or omissions therein. “International HR Adviser” does not endorse any products, services or company listings featured in this issue.

GLOBAL MOBILITY

The Future Of Work And The Impact On Global Mobility In this article, we explore key business and geopolitical drivers behind the latest mobility trends and their potential impact on the deployment of internationally mobile employees, the shift in assignment trends, and the increasing pressures on organisations and global mobility and HR teams to respond to new business opportunities. The tide of change impacting the global mobility industry is significant, as organisations look to new markets and locations to remain competitive. In parallel, global compliance, immigration and uncertainty create increasing challenges on pressured global mobility teams. The purpose of the article is to reflect on how your own organisation is evolving and adapting to shifting global economic patterns and how global mobility and HR teams can maintain governance over all forms of risk. Which of the many roles should global mobility professionals play? Compliance and administration, supply-chain, talent, advisory and risk (fiscal, employment, immigration and data) or other? This represents an interesting challenge and an opportunity to shape the future of work.

Globalisation? It’s Everywhere These Days…

Globalisation enjoyed a one-way growth spurt for a quarter of a century as a result of waves of economic reform. Between the 1980s and the 2007-8 global financial crisis, most of the economic trends reinforced the growth of globalisation in business, and the need to move talent to support that. This caused a massive increase in the numbers of companies that moved from being International to Multinational to Transnational and ultimately Global. Combined with the rise of technology, ever-smaller companies were able to join this global economy. This meant a substantial one-time surge of assignees, as pioneers from head office established new businesses, sourced local champions in privatisations, or built new factories closer to customers, or in areas with lower labour costs (depending on who they were explaining it to).

2018: Green Shoots Of Growth Rather Than Blooming Economies

As we now enter the fourth industrial revolution, organisations recognise that traditional business models, which worked for them in the past, won’t necessarily work as effectively in the future. E-commerce and the dynamic impact of artificial intelligence (AI) and digitisation of many business functions has created disruption and challenge – certainly for those operating in mature, traditional markets. Mckinsey Highlights: Optimistic Growth, Closer To Home Markets i Even during trade-related threats, respondents remain enthusiastic about their companies’ prospects. Accordingly, when asked which countries will provide their companies with the biggest growth opportunities, the responses vary by region though the United States is cited most often, followed by China. • In developed Asia: respondents most often cite China and Japan, followed by the United States and Australia • In Latin America: Brazil is most common (46% name it, compared with 8% of the global average) • In Europe: Germany is cited most often, followed by the United States, China, and the United Kingdom.

Brexit - Should I Go, Or Should I Stay?

One of the key defining events that marked the turn from an outward looking global

focus to a more national based one was the UK’s Brexit decision in 2016. Brexit has been a catalyst for organisations to re-think where they see the greatest benefit of locating their headquarters, research laboratories, and other key high value or geography-dependent sites. Financial institutions that require passporting rights to operate across the EU are looking at options in Paris, Frankfurt and Madrid. As an example, Unilever, the Anglo-Dutch giant recently announced in March 2018 that they would be moving their Head Offices to Rotterdam, rather the current UK/Netherlands set up. The question remains at what stage Global Mobility enters the process to ensure compliance for those currently on international assignments and any prospective ‘group moves’ has a well thought through strategy for operational execution. It is not however, one-way traffic out of the UK and in fact, using Fig. 1 below (Source: The Santa Fe Global Mobility Survey 2018ii), the UK remains one of the top sending and receiving destinations, with 2% net increase in sending internationals from the UK but with the UK level as a destination. While the final outcomes from Brexit are still unclear on many fronts, this is a time of unprecedented change and indeed opportunity to prepare for the next decade and beyond in this ‘brave new world’. The list of most common destinations and sending locations hasn’t changed significantly from 2017, as seen in the Fig.1. (The increase in Spain may represent an increase in Spanish companies in the survey compared to last year).

Fig. 1: Top sending and receiving countries according to 654 global mobility/HR respondents in theSanta Fe Relocation Global Mobility Survey 2018 Destinations (% most common)

Sending from (% most sent from)

2017

2018

2017

18%

14%

11%

China

11%

13%

France

10%

14%

10%

Singapore

China

Germany

Spain

France

Australia

2018

INTERNATIONAL HR ADVISER AUTUMN

The Rise Of Chinese Companies

Furthermore, the Survey reports also that China has reclaimed top spot as the most challenging destination to send assignees globally. 1. China

15%

(+6%)

2. India

(+1%)

3. USA

(-2%)

The change suggests that new companies entering China find the fast-paced nature of a highly competitive market a challenge. Research from Santa Fe China indicates that much of the Chinese outbound mobility seen so far is in the preliminary phase where key individuals are sent from Headquarters to set up the initial overseas markets. International development ideas such as the Belt and Road initiative see Chinese companies investing huge amounts in infrastructure at all points between China and Europe. Whilst the labour dispatched to build facilities may not feel like expatriates in the traditional meanings of the word, the issues of compliance and risk management still apply, and the strategic aspects of workforce planning would still be relevant.

Changing Assignment Types Trend

In the Santa Fe Global Mobility Survey, we have for the past three years asked participants about their current and future assignment trends. The results show that short-term assignments continue to be where the growth lies, with the traditional long-term assignment numbers being broadly flat. However, with deeper analysis, there

seems to be much more to it than that: is this just companies using short-term assignments instead of long-term, or are they looking at something more structural in how they use assignees in their business? As organisations re-think their talent strategy to ensure that they optimise their best talent, for example in underperforming markets, the future investment in international assignments or permanent transfers will be based on more commercial analytics, the returns and investment become more of a business/people algorithm underpinned by robust data analytics that connect HR, Finance and Business Operations in more informed, dynamic way. Whereas once it would have been necessary to relocate for a period of time, it is now possible to work with a team in another location using a combination of business trips and technology. In addition, the re-integration after a longterm assignment, the challenge of what assignments mean for dual career families, and the wider range of assignment destinations mean that the old model is fragmenting. Whilst there may be a similar number of assignees being spread across more countries means that the corporate network in any given country will be smaller. The best companies we work with are being smarter about linking their Global Mobility programmes into their Talent Development programmes. As the long-term strategic opportunities fade in a lower-growth environment, using a series of thought-through shorter-term developmental assignments can enable companies to obtain most of the value of a long-term, without the costs and disruptions.

Stable And Agile

“Over the next decade, AI won’t replace managers, but managers who use AI will replace those who don’t. The most nimble and adaptable companies and executives will thrive!” ‘The Big Idea’ HBRiii July 2017, illustrates that organisations are recognising that nimble players are able to disrupt niche markets in traditional markets, and supply-chains and larger organisations are having to re-think not only their business strategies but also the infrastructures that support their internal supply-chains. Although it is hard to predict exactly which companies will dominate in the new environment, a general principle is clear: Organisations that can rapidly sense and respond to opportunities will seize the advantage in the AI-enabled landscape. So, the successful strategy is to be willing to experiment and learn quickly. Over the last decade however, the trend has shifted. Firstly, there has been a slowdown in the number of new factories being built in developed markets, or even the recently emerged countries in Europe. Secondly, many organisations have completed re-structuring of their supply/ value-chains by relocating service centres and research hubs, reducing the mobility that went with that exercise. With the advancement of technology, even that has slowed down, with self-service IT or artificial intelligence replacing labour, regardless of how inexpensive it is, and partisan resistance to too much exportation of jobs. Effectively, therefore, organisations can increasingly source skills and expertise, either through local staff, outsourcing or AI without the need for international assignments.

Fig 2: Changing Assignment Types

Type of travel

Business trip

Commuter assignment

Short-term assignment

Long-term assignment

Permanent transfer or hire

Old scenario

Trips for preparatory or relationship purposes.

Project-based, with no physical move.

Traditional up to one year model for projects or roles, with physical move.

Traditional two to three year model with asignment benefits for 'strategic' reasons.

Usually for external hires or localisation

New world

What used to take a business trip can now often be a Skype call with screen sharing of presentations.

What used to take a commuter assignment can now be accomplished wiith remote working combined with a few business trips.

Short-term assignments could become commuter assignments, with less disruption to careers and families, as the lower cost of airfares relative to ther expatriate costs redresses the balance.

The disruption to a dual-career couple with children can be mitigated by trading a Long-term assignment for a Short-term assignment followed by a period of commuting. A small apartment and lots of flights will cost less than a family house and expatriate school fees.

Where no home to return to, move is 'permanent' to make clear that there is no intention to return back to the source country.

Typical scenario

Was a Commuter Was a Short-term Was a Long-term assignment, now a assignment, now a assignment, now a series of business trips. commuter assignment. short-term assignment followed by commutes or business trips.

Fewer Strategic assignments, relatively more Developmental assignments.

Assignments from source countries other than headquarter deployed on a move to move basis.

GLOBAL MOBILITY Who Manages And Who Is Accountable For Business Travel?

With the continued growth in Business Travellers and greater fluidity and ambiguity in determining formal assignment types and accidental ones, global mobility and HR teams will need to ensure they work diligently to educate and escalate the need for more structure with business leadership. Today, there is the potential for a compliance breach and in the absence of a formalised, systematic approach, global mobility will be expected to take accountability merely because the word international is included in business travel. Based on Santa Fe’s 2018 Global Mobility survey results, HR and global mobility teams see themselves both accountable and responsible for managing international business travellers, with only 11% of senior management taking accountability. Interestingly, while 68% of respondents in the same Survey report having a formal programme for managing business travellers, only 21% have technology to manage it effectively. The 6% who neither track nor manage international business travellers may be fortunate not to experience compliance issues. However, if they do, they are potentially more likely to be subject to penalties than those who can demonstrate a process or technology solution that had failed situationally, since government agencies are placing more onus on corporations to selfregulate their compliance obligations.

What Next For Global Mobility And HR Functions?

Globalisation in this fourth industrial revolution will see new niche markets and disruptors influence global giant corporations’ purpose,

structures and strategies. From a people perspective too, technology is enabling access to education and interaction for a more diverse society, especially females in locations where there have been restrictions and boundaries. Forbes Insightsiv provide overwhelming data to support this position: ‘Looking forward, companies must also grapple with an ageing workforce, a declining pipeline of qualified talent, and the challenges of managing a multigenerational workforce. But as long as organisations can keep their “eye on the prize,” that is, to keep diversity and inclusion efforts at the top of their priority list, it will position them to weather these challenges and come out ahead of the competition.’ The vogue ‘Talent Mobility’ term has been bandied for some time, but the reality for some organisations is that HR and Global Mobility teams are dislocated from the true value they could be delivering. There is a wave of transformation and it is underpinned by technology and how organisations can re-harness their engagement with their people to take advantage of new work practices, new roles (some haven’t been created yet) and a new purpose in what value they create internally and externally. We invite you to reflect on the changes in your industry, organisation, department and your own job: • Are your international assignment and mobility policies fit for purpose? • Who owns compliance, including for international business travellers? • What will be the impact of technology on your existing roles? • How does Global Mobility integrate with

other HR functions and business functions? • Will Global Mobility continue to exist in its existing format? • HR and commercial data – how could the data held by global mobility facilitate competitive advantage? Finally, we provide you with our view on some of the changes you should be expecting over the short to medium-term. If you would like full details of these Papers, these are available on The future of Work and the Impact on Global Mobility Santa Fe website page. References: i Economic Conditions Snapshot. McKinsey Global Survey results. March 2018 ii Santa Fe Relocation: The Global Mobility Survey: REACT ‘Transformation in the age of uncertainty’ iii The Business of Artificial Intelligence What it can – and cannot – do for your organization. Erik Brynjolfsson and Andrew McAfee. The Big Idea, July 2017. iv Forbes Insights Global Diversity and Inclusion Fostering Innovation Through a Diverse Workforce.

SANTA FE RELOCATION

Santa Fe Relocation is a global mobility company specialising in managing and delivering high-quality relocation services worldwide. Our core competence is providing services that help corporations and their employees relocate and settle in a new country. Santa Fe Relocation is wholly owned by the Santa Fe Group, which is listed on NASDAQ in Copenhagen, Denmark. For more information, visit us at santaferelo.com

Fig 3: Tomorrow’s world, today Today

Tomorrow

• Compliance is critucal, and becoming more complex for a variety od reasons. The move towards more short-term assignments, more flexible policies and new work patterns adds to this complexity. • Short-term business travellers increasingly formaliased into an assignment type with pressure to be managed within global mobility programnmes. • AI and technology will replace traditional activities - we already read about 'chatbots' in HR dealing with routine tasks and even policy support. Certainly, the recruiting industry already relies on such AI. • Pressure on employee head count as organisations seek to leverage technology to deliver operational services. • Pressure on Global Mobility professionals to provide more effective data analytics. • Pressure to demonstrate commercial awareness (arond 40% of respondents know their total programme costs, 22% compare forecast versus actual assignment costs). • Pressure to be more engaged in advisory activities with business leadership. • New destinations and projects being undertaken in emerging locations, requiring greater due diligence. • GDPR - only 30% of Global Mobility professionals were aware of and planning for it, prior to its implementation.

• Talent: greater engagement on objective assessment of assignee suitablity. Enable diversity by challenging traditional thinking on assignment profiling. • Talent: development of new policies and innovative ideas to enable greater culture, gender and generational diversity. • Talent: greater engagement with talent and HR to track postassignment retention and include in data analytics. • Data analytics: increasing focus on providing talent and commercial analytics to demonstrate return on investment. • Employee experience: focusing more on how AI and technology can drive the employee value proposition to enable a positive employee and family experience as part of their internationally mobile career. • Advisory: focus on earlier engagement on international projects, new territories, and new work patterns, including contingent assignees, as talented employees see parallel career paths in the 'gig' economy. • Risk: broader responsibility for overall risk for internationally mobile employees, in conjunction with internal and external subject matter secialists including corporate and employment tax, legal, HR and externally, with immigration, taxation and relocation partners. • Supply-chain owners: redefining Global Mobility global/ local collaboration service models that enable the operational work delivered today in more cost-effective and risk-assured governance processes.

INTERNATIONAL HR ADVISER AUTUMN

Let’s Get Digital Working together, insurers and employers can use technology innovations to benefit globally mobile employees. We live in an age where we’re busier than ever with demanding work commitments, an active home life and pressures to stay fit and healthy. Being time poor means we rely heavily on technology to help our lives run smoothly, and when it comes to managing our health, this is no different. When we’re in good health we want to maintain it. When we’re ill we want to be seen right away, and when we’ve been diagnosed with a health condition we want to be able to manage it. Recent researchi shows that those working abroad are concerned about their wellbeing and ability to care for their families financially. They are also particularly worried about the medical care available and the financial consequences of falling ill. Moreover, they face additional challenges due to a higher level of insecurity and pressure from working outside their home country. In some cases, the health and wellbeing support from their employers may not match their needs. Support for globally mobile employees is more important than ever before, and employees are looking for reliable alternatives.

Convenient Healthcare Is The Driving Force Behind Emerging Digital Health Tools

Globally mobile employees are a valued resource and play a critical role in supporting global business strategies, therefore, more accessible, convenient healthcare is the driving force behind emerging digital health tools. With the progression of technology and digital tools, employers are now looking at ways they can help engage their staff with their health, whilst providing fast access support for any healthcare concerns. Employee sickness absence remains a major problem for companies globally, and we know from our research that 61%ii of globally mobile individuals are not as happy with their personal health and wellbeing as the general population. However, employers now have the opportunity to embrace digital technology and use it to encourage positive change in employee health. This can directly impact employee productivity and absenteeism, as well as helping to improve organisational productivity. Senior management participation and encouragement will also help to drive health engagement across the workplace.

Having the tools in place is one thing, however, in order to drive take-up, employers need the right strategy. Technology innovations can have a significant impact on the health and wellbeing of a workforce, and early intervention pathways can help to reduce absence and increase productivity. Employers play a crucial rule in guiding employees in the right direction when it comes to managing their health. With the right approach, employers can use digital tools such as health and wellbeing apps, to encourage healthier lifestyle behaviours, while making it easier for their employees to access help and advice when they need it.

Employers Can Show Their Commitment To Their Workforce To Encourage Healthier Behaviours

For example, more can be done by employers to improve the physical health of their staff and provide a better duty of care. Our global mobility survey highlights that 53%iii of employees believe health insurance is important when considering moving oversees and with no exception 100%iv of those are concerned about illness.

Employers can show their commitment to their workforce to encourage healthier behaviours - offering a private medical plan is a good place to start. Over time, this helps to minimise health risks and healthcare claims will likely decrease. For Millennials, workplace wellbeing support ranks even higher, with over half (53%v) saying they would choose an employer that offers a workplace wellbeing programme over one that does not. Our on-demand culture means we expect access to information and advice at the touch of a button and this is evidenced with the growth in popularity of wearable devices such as FitBits, Jawbones and smart watches. These gadgets allow individuals to conveniently and continuously track everything from steps to sleep patterns. Used in conjunction with health apps, these devices can help kick-start motivation to lead a healthier and more active lifestyle. In a global marketplace, businesses increasingly need their employees to be more mobile, taking on both short and long-term assignments in new territories that may be very different to what they are used to at home. At the same time, with global mobility increasing, employers need to look at the individual needs of staff to ensure wellbeing.

HEALTHCARE Digital Technology Can Really Benefit The Globally Mobile Community

The globally mobile community often find themselves in an unfamiliar environment when seeking medical guidance, so digital technology can really benefit those who are working abroad. Being able to use a mobile phone for a GP consultation, receive a diagnosis and a written prescription, all without physically having to go to a doctor’s office offers real peace of mind for those working abroad. Recognising the emotional and wellbeing challenges employees and their families face in a new country, and the duty of care employers need to fulfil for their overseas workforce. Globally Mobile Individuals benefit in many ways from their experience of working abroad, not to mention better career opportunities and experiences, but at the same time, they often face challenges in taking care of their personal and family health and wellbeing. Demand for employers to show moral and societal commitment to their workforce is as crucial as ever. Research recently carried out shows that eight in ten people are experiencing stress, with one in five saying that they have ‘unmanageable stressvi’, therefore, it’s vital employees are provided with opportunities that encourage and enable them to lead healthy lives and moreover make choices that support their wellbeing. With the globally mobile becoming a major workforce, their preferences and expectations need to be managed carefully. To perform at their best, these employees must feel protected and supported as they adjust to their new roles in unfamiliar surroundings - Cigna Wellbeing® encompasses all of this to provide an integrated solution.

Reference i 2017 Cigna 360° WellBeing Survey Global Mobile Individuals ii 2017 Cigna 360° WellBeing Survey Global Mobile Individuals iii 2017 Cigna 360° WellBeing Survey Global Mobile Individuals iv 2017 Cigna 360° WellBeing Survey Global Mobile Individuals v 2017 Cigna 360° WellBeing Survey Global Mobile Individuals vi 2017 Cigna 360° WellBeing Survey Global Mobile Individuals

The globally mobile community often find themselves in an unfamiliar environment when seeking medical guidance, so digital technology can really benefit those who are working abroad

LIAM HUGHES

Sales and Client Management Director, Cigna Europe. The Cigna Wellbeing® app provides fully integrated ‘real time’ access to care and health coaching, at the touch of a button via a single access point. Not only does it provide direct access to specialist doctors, nurses and counsellors via the Telehealth feature, but with preventative care and behavioural change at the heart of the new app, the innovative lifestyle management programme educates, inspires, engages and motivates users to become more involved in their own care, and to ultimately live a healthier lifestyle. A key feature for employers includes the ability to provide tailored reports offering insight on staff health and wellbeing, engagement levels and behaviour data such as usage metrics and health. Wellbeing assessment results (whilst protecting the employee) can also be shared with the employer, providing sound business insights and direction. Positive workplace health and wellbeing has never been more important, and the new Cigna Wellbeing® app has been built with all of this in mind, bringing together best practice, research and industry insights into one accessible place. Many health issues suffered by staff working abroad are both predictable and preventable, and the app offers a collective, integrated and innovate tool that gives users greater control of their health and wellbeing, and furthermore makes it easy via 1-2 -1 online coaching. To learn about how Cigna’s leading solutions for globally mobile employees, please visit www. cignaglobahealth.eu or get in touch at internationalsalessupport@cigna.com.

INTERNATIONAL HR ADVISER AUTUMN

Is It All About Compliance? Should Global Mobility Professionals Be More Business Minded? Within Global Mobility we are keen to highlight to stakeholders and senior leadership the need for compliance when an employee travels internationally. However, whilst compliance will always be of fundamental importance, does our need to refer to it devalue both Global Mobility’s role and opportunity to become a strategic partner? Stakeholders and the senior leadership of a company respond to business language, decisions advantageous to the company’s strategy and benefits to the bottom line. Many do not understand the intricate details that Global Mobility professionals face daily nor do they have the time to understand complex immigration and tax legislation. For Global Mobility the need to maintain compliance is fundamental and drives the decisions that the Global Mobility Team make on a daily basis. However, decisions led by the company are not based on compliance but the desire to drive the company’s success in current and new markets. When Global Mobility highlights compliance concerns versus solutions, it can mean concerns are no longer listened to and are instead seen as blockers versus a strategic partner who helps to achieve company strategy.

Understand The Company

Every company is different and the requirements of a Global Mobility Team will vary based on the company’s industry and strategy. The Global Mobility Team needs to engage stakeholders regularly to understand this and start to determine solutions to support the company, including how to mitigate compliance in new or legislative heavy markets. Understanding the company and adapting to align to the wider company strategy will highlight the team as a partner to achieve success, but also ensure compliance, through working together to mitigate it. Stakeholders will be more inclined to partner with a Global Mobility Team if they understand them and the company, versus a Global Mobility Team whose only concern is compliance and does not offer pragmatic solutions.

Highlight The Global Mobility Team

The Global Mobility Team, in my experience, are not good at highlighting their strengths and successes in line with company strategy.

Often the Global Mobility Team are there after other Human Resource functions have left for the day and go the extra mile to enhance the employee experience, but it is very rare that this is highlighted to management or senior leadership. The Global Mobility Team can listen to stakeholders and align to company strategy, but it is essential that team achievements are discussed with senior leadership, in particular cost savings that are achieved through stakeholder partnership and aligning to company strategy. The Global Mobility Team can become a strategic partner who proactively partners with stakeholders to achieve success and help the company achieve its strategy. However, if this is not openly publicised and promoted then the Global Mobility Team will never be seen as more than a team focused on compliance.

growth and continuously look for innovations to improve capabilities. The Global Mobility Team should never be afraid to promote their successes or ask for additional budget to improve their capabilities. The ability to build a business case to support looking at the long-term benefits to the company, through proving worth as a team that is aligned to company strategy, can help make the Global Mobility Team be seen as a true partner.

Take The Opportunity

The average Global Mobility Team is often under resourced and underfunded, with no time to partner with stakeholders or ability to align to the company strategy. I myself have often felt the idea to become a strategic partner was out of reach, due to a heavy workload, but through promotion it can be achieved. With success stories and cost savings helping to raise the Global Mobility Team profile to senior leadership, business cases can begin to be built. The business case should not focus on compliance, but how to benefit the company long-term. Business cases should look to present case studies, projections on cost savings and how the investment into the Global Mobility Team will help the company. A business case should never focus on compliance, something a Global Mobility Team should automatically achieve, but how the team will be transformed through this investment. To truly enable the Global Mobility Team to be seen as a strategic partner versus blocker, who enables company success and growth, an adjustment to how Global Mobility is perceived needs to occur. This will not happen through adhering to compliance legislation and regulation only, but through Global Mobility taking the initiative to help drive success and company strategy. Compliance should always be adhered to, but Global Mobility Teams need to start to be at the forefront of a company strategy and developing innovative solutions to help achieve this. Global Mobility Teams need to engage in regular discussions about strategy, align their policies to promote company

HOLLY MARIA CREED

Holly graduated with a BA (Hons) in History and upon graduation undertook a graduate scheme in US and UK expatriation tax before moving to EY to specialise in global mobility. Over the next 18 months Holly ran a FTSE 100 client account and undertook her first Assignment to India. Upon Holly's return from India, she moved into Global Mobility consulting before undertaking the role of project manager to help the Head of Global Mobility establish a new operating model for an international energy company. This role saw Holly and her colleagues receive considerable industry recognition and named as runner ups within the EMEA region for team of the year. Holly currently works as a Global Mobility Manager responsible for Europe within a large technology firm. Along with her worldwide colleagues she is currently working towards the harmonisation and re-design of the Global Mobility Function following a merger. Holly’s role as part of the harmonisation project is to lead the Vendor, Business Visitor Compliance and Tracker Programme, a role she has been relishing for the last seven months. Holly is fast gathering a positive reputation within the industry and in 2016 was nominated and shortlisted for Global Mobility Rising Star within the EMEA region and in 2018 co-founded and launched the Next Gen GM.

INTERNATIONAL HR ADVISER AUTUMN

5 Actions to Enhance Leadership Diversity Gender parity doesn’t happen on its own. It takes a conscious effort and steadfast commitment to change the lack of diverse talent within your upper tiers. Now more than ever, women are ready for their rightful seat at the proverbial table. The topic of gender parity is not a concern for just one company, one industry, or even one country. It is a global business issue being discussed worldwide. For many organisations, pushing this initiative can be a challenge, but it doesn’t have to be. Employ these 5 steps to balance the gender scales at your organisation.

1. Find Your Visionary Leader

How many times has your company said, “We’ll start a leadership development programme when we are ‘ready’?” The truth is, no company is ever fully ready - especially without developed leaders. A visionary leader needs to put a stake in the ground. Is that you? Set stretch goals for your organisation, knowing it will require you to be bold. Sharing these goals with the company can be a challenge, but it needs to be proactively addressed. Break these goals down into milestones and building blocks that can be achieved over the course of a year.

2. Share The Current Data

As you set these visionary goals, you may fear alienating the existing majority within your company. It’s imperative to understand where your workforce is today. Analyse the demographics of your employees at different levels. This data tells a story. While 50% of your overall employees may be

women, what’s that percentage at the top management levels? Sharing it throughout your company allows everyone to clearly see where the gaps are. This starts a rich and meaningful dialogue about what the impact is to the company if you don’t strive for gender balance. Use this telling data as a springboard to motivate people to embrace the change initiatives, helping you build grassroots support and achieve an organisational-wide mind shift. Accelerating the careers of all high potentials will take buy-in at all levels.

3. Establish & Celebrate Early Wins

Take time to celebrate milestones as you achieve them. As your female high potentials make small changes to their work style and take on stretch assignments, it’s empowering to recognise those small achievements. This reinforces the progress each person is making and gives senior leaders and executives an opportunity to see the diversity initiative in action. On the flip side, celebrating these wins reinforces to the company that you are committed to seeing the programme succeed. Another win worth noting – diversity initiatives are attractive to potential employees and customers. Find ways to celebrate your efforts externally so candidates and future business partners recognise the strides you are taking to advance women leaders at your organisation.

4. Analyse Organisational Practices

Organisational practices can sometimes be a barrier for women’s advancement. We encourage companies to do a check:

Take time to celebrate milestones as you achieve them. As your female high potentials make small changes to their work style and take on stretch assignments, it’s empowering to recognise those small achievements Where do you recruit? How diverse is your applicant pool? Are you attracting as many men as women? What are your interviewing practices? Dr. Thorsten Thiel, Managing Director at GISMA Business School in Berlin, shared: “In Germany and many European countries, the question around gender equality in the job market is an important point of debate. Things can be done systematically to tackle this issue from a corporate and business perspective”. Another area to analyse is your current employee development programmes. Of the people who are enrolled in your highest leadership development programme, what percentage of them are women? Determine if the criteria for those programmes promotes career growth for women or prohibits it. This goes for your interviewing

LEADERSHIP DIVERSITY and hiring practices, committees, and stretch assignments. Gaining awareness of your current practices can unearth red flags that previously went unnoticed or unaddressed.

5. Institute Manager Involvement & Executive Sponsorship

Involving managers and executives in the development efforts increases the woman’s visibility. Line managers are an employee’s #1 advocate for future growth opportunities – yet can also be the #1 barrier. Connect both the female employee and her manager with a professional coach during your development programme. This third-party coach will do wonders for opening up dialogue about the role of the manager in the woman’s career advancement. If women don’t have relationships with various executives within their organisation, they’re likely missing out on opportunities for growth. Executives are aware of opportunities for new departments, new roles, or new products; however, they are not always aware of the high potentials who could benefit from these opportunities. Being top of mind with an executive increases the chances of rising female leaders being tapped for that role or project. Enhancing leadership diversity takes a bold commitment to dive in. The time is

NOW to tap the diverse high potentials at your organisation. Discover the difference an integrated Women in Leadership programme can make among your ranks.

If women don’t have relationships with various executives within their organisation, they’re likely missing out on opportunities for growth

LAUREN HERRING

Lauren is CEO of IMPACT Group and the author of This Side Up! A Simple Guide to Your Successful Relocation. She passionately leads the organisation to empower employees and families during times of career transition across the globe. Visit www.impactgrouphr.com

INTERNATIONAL HR ADVISER AUTUMN

The Irresistible Mobility Experience In business, the customer is King. Organisations go out of their way to deliver the best customer experience possible; whether in store, online, or through an app. The employee experience, however, is typically very different, and employers are struggling to change this dynamic1. When employees move internationally for work purposes, they may be expected to navigate various complex systems or processes and co-ordinate multiple stakeholders, in the midst of emotionally preparing to work overseas. But what if we could deliver a mobility experience that feels more like a worldâ&#x20AC;&#x2018;class customer experience? An experience in which employees can more easily interact, access information, review options and take action seamlessly. How can organisations go about achieving this vision for their global mobility programme?

The Employee Experience Landscape

Organisations today are faced with an increasingly complex global talent landscape. From the perennial forces of regulatory change, geopolitical tension and economic uncertainty, to the unprecedented rate of technological change and the shift towards an agile, diversified and on-demand global workforce, businesses are re-evaluating their views on mobility and work. In particular, faced with increasing transparency and crippling skills shortages, organisations are realising the significance of a positive and consistent employee experience to improving engagement, attraction and retention, ultimately resulting in an enhanced customer experience and positive business outcomes2. In response to these changing dynamics, leading organisations are now developing an integrated focus on the experience for the entire workforce (Figure 1). Similarly, when it comes to the mobility experience for employees moving internationally, this means shifting from a reactive, one size fits all approach, to a proactive, personalised approach which creates human value using insight based decisions.

The Mobility Journey

Be it an overseas business trip, a fixed-term assignment or a permanent move, relocation

can be exciting, but also challenging and emotionally demanding. It may provide new opportunities, but also cause increased levels of stress. From adapting to a foreign culture and integrating into a new work environment, to the pressure placed on relationships and families, an individualâ&#x20AC;&#x2122;s emotional wellbeing may fluctuate extensively across the relocation journey (Figure 2). Coupled with the increased administration involved for the individual in organising an international move, employers face a considerable challenge in creating a positive experience for mobile employees. With this in mind, it is perhaps unsurprising

that employee willingness to move has decreased3; representing the number one barrier to managing a global workforce today4.

Placing The Employee At The Centre Of Mobility

We believe the employee experience should be irresistible even when someone moves internationally. What drives a positive mobility experience will differ at each organisation, and will be impacted by the business strategy, sensitivities to cost, speed and efficiency. It is, however, essential that the experience meets the needs of the user, i.e. the employee, taking into account different

MOBILITY EXPERIENCE demographics and deployment types. The irresistible mobility experience balances a human-centred approach with the strategy and culture of the organisation, curating the mobility journey around the employee’s needs to deliver a consistent and high-quality experience.

Where To Get Started

Organisations can take the following steps to start bridging the gap: 1. Identify the mobility experience challenges by considering the possible pain points in the end to end user journey, e.g. employees feel overwhelmed with the volume of administration involved with their moves. 2. Listen to the voice of every mobility user, including employees, service providers and business leaders, to gain a more in depth understanding as to the current service. 3. A nalyse the existing experience by reviewing any available data on mobile employees. 4. Focus efforts on the parts of the mobility journey which will have the biggest impact on the overall experience. 5. Create tailored solutions that are desirable to employees, financially viable, and organisationally feasible.

On-Going Experience Measurement

Developing a robust means of measuring the mobility experience is essential, not only to help establish the challenges in the existing service, but also to validate that any enhancements achieve their objective of improving employee engagement. Historically, organisations have done little to measure the mobility experience. Where measurement does occur, it is often undertaken by third party vendors through one-time surveys, but response rates are typicality low, and the principal objective is to review the overall quality of operational support available to mobile employees from service providers.

A more holistic and targeted mobility data set can help organisations to stay ahead of the curve, understand the factors influencing the success of international deployments, and make real time interventions to improve the mobility experience. This is why organisations are revisiting the scope and depth of themes which provide a measure of the mobility experience. There are four key areas which organisations may find important to measure (Figure 3): The most forward thinking approaches are also reconsidering the mechanisms used to collate this data, with a human-centred focus on what works best for the employee. This could mean a move away from retrospective pulse surveys and assessments, to a real-time app based solution or cuttingedge wearable technology. These innovative approaches may allow employees to provide instant feedback on their mobility experience, through a simple user interface, and with an automated triage of specific issues to the correct contact. Not only can this facilitate swift resolution of challenges in real-time, but data analytics can also enable organisations to pick up on key trends, and plan improvements to the typical mobility journey based on recurring themes. It is important to stress that each organisation's approach to mobility experience measurement may be different, taking into account company culture and other measurement mechanisms which are already in place across the wider organisation.

Conclusion

To provide an irresistible mobility experience, organisations must move from the old to the new rules. This means placing an increased level of focus on how the mobility journey feels for those who move oversees. Only by truly assessing the current service through the lens of its users and creating experiences to meet employees’ specific needs, can organisations effect meaningful change. Taking steps which make a tangible and human impact on the mobility experience

can significantly enhance the mobility brand, acting as a role model for the wider organisation's employee experience initiatives. Now is the time for organisations to get ahead of the curve and tackle the challenge head on. Reference 1 2017 Deloitte Global Human Capital Trends Report 2 Building Business Value with Employee Experience, MIT Cisr Research Briefing 2017 3 Boston Consulting Group − Decoding Global Talent 2018 4 2018 Deloitte Global Human Capital Trends Report

GETHIN HINE

Mobility Experience Lead T: 020 7007 9799 E: gethine@deloitte. co.uk

RUMI DAS

Workforce Transformation Director T: 020 7007 0433 E: rudas@deloitte.co.uk Deloitte’s Global Workforce practice Deloitte’s market-leading Global Workforce team partners with organisations to establish future-proof global workforce strategies, tailored to client specific business and talent objectives. We have vast experience in collaborating with organisations to optimise, reshape and transform both the operational and strategic aspects of mobility and talent programmes. We embrace design thinking to help clients to reimagine their approach to talent mobility, focusing on areas ranging from policy and process design, service delivery model transformation, programme effectiveness measurement, customer experience enhancement, global talent strategy, digital planning and workforce analytics. Our multi-disciplinary team of over 250 global professionals specialise in transformation, analytics and technology, and we also partner with third-parties and start-ups. Our unique approach and design-led mind-set bring industry specific and functional knowledge, as well as data driven insights and innovative technology solutions. We have a proven track record of delivering complex projects and providing unrivalled thought leadership. www.deloitte.co.uk/globalworkforce

INTERNATIONAL HR ADVISER AUTUMN

Global Tax Update CHINA

Full Text Amendment on PRC Individual Income Tax (“IIT”) Law Released The Chinese National People's Congress (NPC) published a draft amendment of the Individual Income Tax (“IIT”) Law (“the Draft Amendment”) on 29 June 2018. The Draft Amendment solicited public comments. Key Changes to the Draft Amendment Definition of China residents An individual who is Chinese domiciled or is a non-domicile but has resided in China for 183 days or more in a tax year will be deemed as a Chinese tax resident. A Chinese tax resident is responsible for PRC IIT on all the income derived within and outside China according to the provisions of China IIT Law. An individual who has no domicile and does not reside in China or who has no domicile but has resided in China for less than 183 days in a tax year will be deemed as a Chinese non-tax resident. A Chinese non-tax resident shall pay China IIT on income derived from China according to the provisions of PRC IIT law. Consolidation of certain income types for taxation The Draft Amendment is considering consolidating four types of labour income, including wage and salary, remuneration for personal services, author's remuneration and royalty into one category (hereafter referred to as “consolidated income”). Update of PRC IIT rate table and basic standard deduction Currently, an IIT rate ranging from 3% to 45% is applied on wage and salary income. The unified progressive tax rate applicable for consolidated income has been issued. The tax brackets of the income applicable to tax rates between 3% and 25% are adjusted to allow taxpayers to enjoy lower tax rates while those of the tax rates from 30% to 45% remain unchanged. Basic standard deductions applied to wages and salary will continue to be applicable to consolidated income, whilst the monthly deduction amount will increase from RMB3,500 to RMB5,000 (i.e. RMB60,000 per year). Specific additional tax deductions As well as the above mentioned basic standard deduction and mandatory individual social security contributions, specific additional tax deductions such as child education, continued education, medical expenses for serious illness,

housing loan interest and housing rent are under negotiation by the financial and tax department of the State Council and other relevant governments. Proposal of annual reconciliation filing on consolidated income Tax residents shall calculate IIT on consolidated income on an annual basis. However, for tax residents who have withholding agents, the tax liabilities shall be withheld and prepaid by the withholding agent on a monthly basis or based on the occurrence of the income. An annual reconciliation return should be performed from 1 March to 30 June following the year end if there is additional tax due or any overpayment. In the event of tax residents providing relevant information of specific additional tax deductions, the withholding agent shall not refuse to deduct such amounts while prepaying the monthly IIT. Non-tax residents shall also calculate IIT on consolidated income on a monthly basis. The withholding agents shall withhold and prepay the IIT liability on behalf of the nontax residents on a monthly basis or based on the occurrence of the income, and no annual reconciliation filings are required. If there is no withholding agent, non-tax residents need to perform self-declaration within 15 days in the following month upon receiving the income. Anti-tax avoidance and collaboration among relevant authorities Referring to anti-tax avoidance regulations of PRC Enterprise Income Tax, the tax authorities are given the power to make tax adjustments and impose interest in a reasonable manner in respect to individual tax avoidances - such as transferring of property between an individual and his/her related parties in violation of the arm’s length principle, tax avoidance in tax havens outside China, and obtaining improper tax benefits from other unreasonable commercial arrangements. BDO Comment Impact on taxpayers Taxpayers’ tax burdens will be reduced, especially for middle and low income groups, through the modification of the tax rate and improvement of the tax deduction and specific additional tax deductions of the consolidated income. The existing annual tax filing will be replaced by the annual reconciliation filing with the filing period to be updated from 31 March to 30 June of the following year.

Anti-tax avoidance and collaboration among relevant authorities indicates that China will strengthen information exchange among relevant parties and enhance the IIT administration. According to the existing PRC IIT implementation rule, foreign nationals who reside in China for more than five full consecutive years will be subject to PRC IIT on their worldwide income. In light of the fact that the Draft Amendment may apply a 183-day period to determine the status of China tax residence, attention should be paid to any proposed changes to the aforesaid five-year rule. If any changes are made, it may significantly impact certain foreign nationals. Based on the above, taxpayers should take extra care to ensure they can claim necessary tax benefits and avoid potential tax risks generated by these new policies. Individual income tax policy for cash awards received by scientific and technological staff In support of the implementation of the “Mass Entrepreneurship and Innovation” initiative and facilitating the transformation of scientific and technological achievements, notice has been issued on the Individual Income Tax Policy for Cash Awards Received by Scientific and Technological Staff for the Transformation of On-duty Scientific and Technological Achievements. The main points of the Notice are: (1) 50% of cash awards distributed to scientific and technological staff by non-profit research and development institutes and institution of higher learning is counted as “wage and salary income” for the current month to calculate the individual income tax due (2) When distributing cash awards to scientific and technological staff, nonprofit research institutes and colleges shall withhold and remit the individual income tax in compliance with the individual Income Tax Law. This Notice came into force on 1 July 2018. It may apply if cash awards are offered within 36 months of this date.

EUROPEAN UNION

Changes to the Posting of Workers Directive The Posting of Workers Directive (PWD) is in place to protect the employment rights of individuals on a work assignment in another European country. It assures that the worker has certain core rights in relation to pay, annual leave, maximum working hours and protection from discrimination etc.

GLOBAL TAXATION The duration of time that an assignee can be classed as a “posted worker” is changing from the current 24 months. This will in future be limited to 12 months with the potential to extend it to 18 months. After this time, all employment rights available to local employees within the host country will be applicable to the assignee, not just the core rights applicable through the PWD. BDO Comment No date has been set as of yet for the changes to come into place, but there will be a two year implementation period. However, it is best to start thinking about the affect this will have on you as an employer now. The term “posted worker” covers the spectrum of employees, from short-term business visitors to commuters to longterm assignees. Therefore, the PWD and the changes coming into place will most likely affect your employees. Brexit may of course add an additional complication.

NETHERLANDS

Dutch Tax Treaties with the Gulf States/ Tax Exemption instead of Tax Credit According to current tax treaties between the Netherlands and some Gulf States (such as Bahrain and Oman), a tax credit must be taken to ensure there is no double taxation on employment income. For Dutch tax residents this means it is possible to deduct the actual taxes paid in the foreign country. As the income relating to the activities carried out in those counties may not be taxed there would be no reduction of Dutch taxes and the income relating to the duties performed would be fully taxed in the Netherlands (maximum tax rate in 2018 is 51.95%). The Dutch State Secretary of Finance issued a decree in 2017, which includes an approval for Dutch residents to use the tax exemption method instead of the credit method on certain employment income relating to activities in the Gulf States. By using the tax exemption method, the income relating to the activities in the Gulf States is relevant and not the actual tax paid. By using this method these employees benefit from the fact that that there may be no taxes due in the other country. Recently the Dutch State Secretary of Finance informed the parliament that it is an exceptional situation that there is low or no taxation in these countries. He mentioned that the decree only applies to Dutch residents with income relating to employment performed in these countries. The State Secretary does not foresee any tax-constructions on this point because there must be real employment relationships. However, the Dutch tax authorities are alert to signals of possible abuse.

Benchmark Scale Rates and Overseas Scale Rates – abolition of receipt checking From 6 April 2019, there will no longer be a requirement to evidence claims which fall under the threshold set out in Benchmark Scale Rate (BSR) and Overseas Scale Rates (OSR). However, this treatment is only applicable to claims that fall within scope of these rates, therefore it is important to remember that a claim still needs to be verified as such before assuming this treatment. New Double Taxation Agreements (DTA’s) with Guernsey, Jersey and Isle of Man The UK has signed new DTAs with the 3 Crown Dependencies. They are expected to come into force by the start of the next tax year. These new treaties will replace the existing treaties, which have not been updated since the 1950s. They are OECD model treaties and BEPS compliant. There are key changes regarding residence and taxation of employment income: • The old treaty defined residence by reference to the domestic laws. This is still the basis for the new treaty but there is now a tie breaker test so it is clear where an individual is considered resident when applying the terms of the treaty • Revision to the employment income article on the period over which 183 days is calculated and bringing in the concept of economic employer • Inclusion of a specific article to cover director’s remuneration.

Non-resident directors may also find they are now liable to tax on income for board positions they hold in the other location • BDO Comment Individuals and employers need to be aware of these changes. It is now more difficult to be exempt from tax in the

host location as the parameters have been tightened up. Non-resident directors may also find they are now liable to tax on income for board positions they hold in the other location (i.e. the country in which they are not resident). HMRC Consulting on Extending the Application of the Short-Term Business Visitor Agreement For a number of years now, companies have been able to put a business visitor agreement in place with HM Revenue & Customs (HMRC) to ease the strict PAYE withholding regulations for overseas employees coming to work in the UK. This covers those employees that would ultimately be exempt from UK tax under a double tax treaty, including employees of overseas subsidiaries but not those employed by an overseas branch of a UK company. The government is looking to simplify the tax and administrative treatment of visitors from overseas branches and comments have been sought by HMRC. Two broad options were proposed: 1. Extending the availability of the annual PAYE scheme to those coming to work for up to 60 days in a tax year. 2. Implementing a new exemption under the business visitor arrangements such that branch employees would be treated in a similar fashion to employees of overseas subsidiaries. BDO Comment It is welcome news that the UK government and HMRC is looking at ways to simplify the tax and administrative burden for overseas branch employees. This should encourage further inward travel and investment to the UK, especially with the backdrop of Brexit to consider and the ever increasing scrutiny on international businesses to ensure they are compliant. As we progress through the consultation period we will provide any relevant updates. Biometric Residence Permits and National Insurance Numbers From August 2018, a National Insurance (NI) number will be issued alongside UK residence permits regardless of an expatriate’s liability to pay NI contributions. This will not automatically mean all expatriates will now be liable to NI – this will still be determined by the underlying social security legislation. HMRC has advised that a NI number will assist them in tracing expatriate records. BDO Comment Employers should be aware that NI numbers will now be issued even where no liability to NI contributions arise. They still need to understand the relevant social security legislation to ensure NI is paid where it is due.

INTERNATIONAL HR ADVISER AUTUMN

New IRS Compliance Campaigns: Increased Risk of Examination for Tax Returns with Foreign Elements The Internal Revenue Service (IRS) announced on 21 May 2018, six additional compliance campaigns in addition to twenty-nine campaigns that are currently in process. Considering the new tax legislation enacted on 22 December 2017, and also their stagnating (or decreasing) budget, the IRS Large Business and International division (LB&I) is moving toward issue-based examinations. It appears that the IRS is deploying its limited resources (personnel and budget) into areas where it can achieve the biggest gains. The latest compliance campaigns announced in May, focus heavily on international topics (five out of the six compliance campaigns address international individual compliance issues). Form 1042 (Annual Withholding Tax Return for US Source Income of Foreign Persons) and Form 1042-S (Foreign Person’s US Source Income Subject to Withholding) Compliance – if payment of US source income (interest, dividends) is made to foreign persons, the payer is required to comply with withholding and reporting requirements. Those requirements may create significant burden for payers who do not make those payments often and who may not have staff who are adequately trained. Form 1040NR (US Non-resident Alien

Income Tax Return) – the LB&I lists three specific topics in its campaign with respect to non-resident aliens: • Tax treaty exemptions • Deductions reported on Schedule A (itemised Deductions), and • Tax credits. Non-resident aliens can exempt certain income based on income tax treaties between the US and their home country; however, as each treaty may be somewhat different, it is often difficult to navigate the complex and confusing set of rules. Incorrect application may trigger an examination that could result in additional tax, penalties and interest. Even though Form 1040NR is similar to the US Individual Income Tax Return (Form 1040) filed by most US citizens, green card holders and resident aliens, there are differences that have a significant impact on an individual’s taxable income and ultimately their income tax liability. One of those differences is the tax treaty exemption described above. In addition, the itemised deductions allowed on a nonresident alien return are very limited compared to the itemised deductions allowed on Form 1040. Lastly, many of the credits available to US citizens, green card holders and resident aliens are not available to non-resident aliens. Form 3520/3520-A (Foreign Trust Reporting) - The last of the internationally focused compliance campaigns may have the most

significant consequences for those affected. A US tax resident who receives a distribution from, or contributes to a foreign trust, is required to file Form 3520. If a US tax resident owns a foreign trust or is considered the owner of a foreign trust, the trust must file Form 3520-A. It may come as a surprise but many foreign investment instruments can fall under foreign trust reporting (e.g. Canadian Registered Education Savings Plan). Depending on the situation, generally the initial penalty for failing to file Forms 3520 or 3520-A can be $10,000 or up to 35% of the gross reportable amount (whichever is greater). BDO Comment The IRS is focusing its resources on many of the foreign elements reported on income tax returns or informational forms. The penalties can be substantial and corrective action time-consuming and expensive. It is important to remember that each compliance campaign lists several treatment streams (such as education and outreach), but every single campaign addresses noncompliance and errors through examination. Prepared by BDO LLP. For further information please contact Andrew Bailey on 0207 893 2946 or at andrew.bailey@bdo.co.uk

ARE SPONSORING THE FOLLOWING SEMINAR AT

The 2018 Global HR Conference FOR GLOBAL HR PROFESSIONALS ONLY

Monday 8th October 2018, from 12.30pm – 5pm at The Adelphi Building, Smith & Wollensky, 1-11 John Adam Street, London, WC2N 6HT (very close to Charing Cross & Embankment stations)

Global Mobility Trends and Tax Update

An overview of Global Mobility trends and an update on current tax issues impacting employers with internationally mobile employees. Sponsored by BDO LLP and hosted by Karen McGrory

INTERNATIONAL HR ADVISER AUTUMN

Taxing Issues: A Shrinking World In 1789, Benjamin Franklin allegedly wrote in a letter ‘In this world nothing can be said to be certain, except death and taxes’.

longstanding and new media platforms. Paying the ‘right tax’ is now positive news.

Many have challenged his supposed comments over the years by unilaterally determining that even taxes are optional. Their world is, however, rapidly shrinking. The net is rightly closing in on those who do not pay their taxes, whether unintentionally or deliberately. In a world of employees working across borders, this applies equally to both the individual and the employer. This article examines some of the issues that arise, and details some of the steps tax authorities are taking to ensure that tax due is paid.

The UK Government and HM Revenue & Customs (HMRC) have implemented a number of measures to encourage greater compliance. Here are a few of them:

Background

In years gone by some taxpayers adopted unsavoury habits when working across borders such as: • Reporting income and gains received from one location only whereas payment was received in at least two locations • Forgetting about and not reporting income, gains and assets derived in other locations • Treating a single payment differently in different countries to get a different tax approach by altering the description. For example, a ‘termination bonus’ for leaving one country and a ‘golden hello’ for arriving in another • Not tracking trailing payments or payments spanning longer periods, such as bonuses and equity awards • Wilfully ignoring the tax rules, as doing so would incur ‘compliance costs’. For example, not tracking business travellers as it is ‘too hard and costly to do so’ • Relying on the failure of tax authorities to cooperate or share information. The tax authorities are rightly addressing such matters in the UK and elsewhere and are rapidly introducing their own methods to encourage greater compliance. Additionally, tax has become far more newsworthy in recent years. Companies and individuals want to be seen as good corporate and individual citizens. Whether this is simply to be compliant, to protect their reputation/ profits or to ensure they are not by-passed in receiving official honours is debateable, but this was not and is not always the case. In today’s world, individuals and businesses will be publicly castigated if they are not seen as paying their ‘fair share’ of tax. News of any such failures will be rapidly shared via

Steps To Encourage Greater Compliance

The UK Government and HM Revenue & Customs (HMRC) have implemented a number of measures to encourage greater compliance Education And Awareness

HMRC has advised that there a number of common areas of error when it comes to international assignees, as follows: • Failing to operate UK wage withholding (PAYE) on all cash payments made to include home, host and third country locations – simply paying amounts in another country, perhaps by a different legal entity in a different currency does not mean that the payment is not taxable – you do need to look at all payments to determine taxability • Failing to report all benefits provided in home, host and third country locations – again simply providing benefits pre or postassignment in another country, perhaps by a different legal entity in a different currency, does not mean that the benefit is not taxable – you do need to look at all benefits provided to determine taxability • Failing to track and report trailing payments such as bonuses and stock awards. These payments may span several tax years and periods in several countries. Ignoring this is

likely to give rise to problems. Do track all such payments and look to see what tax is due and where • Failing to track short-term business visitors – the performance of duties in the UK may give rise to UK taxable income. Treaty exemption may not be due. How can employers determine potential PAYE if they are not tracking such visitors? By sharing common areas of error, HMRC aims to educate employers to look out for such issues and take steps to ensure compliance. Interestingly, these areas are also specific targets for Employer Compliance reviews. Stay one-step ahead of HMRC by asking related questions. Do track properly and report correctly. HMRC is not the only tax authority to step up their interest in international issues. Do read the US article in the Global Tax Update to see how the US Internal Revenue Service has decided to increase examination of tax returns that include foreign elements. Again, HMRC is also not the only tax authority to focus on business travellers. All are now taking a far greater interest with certain countries having strict or new rules such as Canada and Ireland. You ignore business travellers at your peril.

Employer Compliance Reviews

HMRC conduct employer compliance reviews to ensure that employers are correctly meeting their tax and NIC requirements in relation to their employees. We are currently seeing more of these reviews and increased HMRC activity. These reviews can be either in person or by means of an initial questionnaire. An employer found to be in breach of the legal obligations in these areas can face serious consequences. These reviews include internationally mobile employees, the taxation of their regular employment income as well as the tracking, reporting and taxation of their bonuses and equity income. HMRC also want to review relocation and assignment policies/letters so they can cross-reference these to payments received including incentive/share plans. Specific questions raised include: • What types of employees within your business typically travel and for what purpose and to where? • Is travel & subsistence (T&S) provided to any non-employees and if so why? • How do you pay and account for any T&S payments? • Do you have a travel policy document – If so can you attach a copy?

TAXATION • Are any employees seconded from an overseas subsidiary parent or associated company? • If so, what duties are undertaken? • Are relocation expenses paid? • Are any of your employees working abroad on assignment? • If so, where and how long is the assignment? Questions will also be asked in relation to directors. Do not forget to address UK and non-UK issues in relation to non-UK tax resident directors.

Common Reporting Standards (CRS)

The Common Reporting Standard (CRS) is a global standard for the automatic exchange of information, commissioned by the Organisation for Economic Cooperation and Development (OECD). Over one hundred countries have committed to CRS and the list is growing. Overseas financial institutions are obliged to provide details to HMRC about anyone who owns foreign investments and appears to be a UK resident, for example, by having a UK postal address. The United States Foreign Account Tax Compliance (FACTA) rules are another example of how non-UK tax authorities seek to ensure compliance occurs. HMRC will soon be receiving significant amounts of information. This information is provided online and will be easily linked to individuals’ tax files. Reports will include information on remittance basis users, which is likely to be of particular interest to HMRC. Financial institutions are not under any obligation to notify clients that information can or will be disclosed to tax authorities of other CRS member countries. The days of relying on limited cooperation between tax authorities is diminishing. Should an individual forget about assets held and income received in other countries, tax authorities may well find out in any event. Stringent penalties will apply in such instances.

The potential impact for Short-Term Business Visitors (STBV) is confirmed in recent updated RTC guidance published by HMRC, where they set out two specific examples involving STBV’s where a failure to notify HMRC of a liability to tax can give rise to penalties. Will the business visitor even know that they have an obligation to notify HMRC? Ignorance of rules is not an acceptable excuse. Inevitably, any STBV would immediately look to their employer to meet any liabilities and, in the two specific examples mentioned by HMRC, UK PAYE could be due in any event by the ‘UK employer’.

The Common Reporting Standard (CRS) is a global standard for the automatic exchange of information, commissioned by the Organisation for Economic Cooperation and Development (OECD)

Requirement To Correct (RTC)

The RTC deadline of 30 September 2018, deliberately coincides with the commencement of HMRC receiving significant information electronically from overseas tax authorities under Common Reporting Standards (CRS). RTC is a statutory obligation for taxpayers with overseas ‘matters’ to correct any historic tax positions if necessary. Individuals who fail to comply will face punitive financial penalties and other severe sanctions. For example, a tax-geared penalty of between 100% to 200% of the tax not corrected and a 150% minimum for prompted disclosures. Although RTC applies to individuals, this could affect your organisation from an international assignee/business traveller perspective.

The operation of an STBV agreement and/or an annual PAYE scheme provides an exemption for the STBVs to file a UK tax return provided they meet the terms of the relevant agreement. Where a STBV agreement or Annual PAYE Scheme is not in place, or the STBV does not meet the terms of either agreement, all visitors will be required to file a UK tax return. The UK is not the only country that seeks to encourage individuals to correct their historic filing positions. For example, in Ecuador, natural persons who have the below assets outside of Ecuador which amount to US$100,000 or more at the end of the fiscal year must report them to the Internal Revenue Service:

• • • • • •

Deposits in savings Checking accounts Term deposits Investment funds Managed funds Fiduciary rights. This information must show: the type of asset, account number, country in which the asset is located and its value. This information must be reported by February of the following year. Again the issue of penalties arises. The concealment of information regarding such assets abroad will be subject to a fine. This will be equivalent to 1% of the total assets of the taxpayer, or 1% of the income of the previous fiscal year of the concealment, whichever is greater, for every month or fraction of month of delay in the declaration, without exceeding 5% of each item.

Tax Amnesties

Amnesties occasionally arises, such as recent legislation in Turkey relating to foreign assets. The Tax Amnesty Law, allows Turkish tax residents to bring assets acquired in another country to Turkey under beneficial conditions. It may also include immunity from enquiry and inspection in relation to foreign assets. Where qualifying dividends and capital gains derived from foreign stock assets were remitted to Turkey, and declared by 31 July 2018, then they were not taxed. If assets are declared after 31 July 2018 but by 30 November 2018, they will be taxed at 2% - the assets must be brought into Turkey within three months of the declaration being made. Proof of transfer of income to Turkey within the time period specified must be given in both of these instances. The income from the assets brought into Turkey must be reported on the tax return; however, it will be shown as exempt from tax if it meets the criteria for exemption and will not have any effect on the income tax calculations. The amnesty also applies to Turkish resident taxpayers participating in stock arrangements with their employer, where the underlying shares are foreign stock. Turkey is not the only country to provide an ‘amnesty’ or some specific type of encouragement to disclose. For example, in the UK we had the Liechtenstein Disclosure Facility, the Offshore Disclosure Facility and specific measures linked to Swiss bank accounts. Another area of historical non-compliance for international assignees was the practice adopted by some companies and individuals of declaring for host tax purposes a ‘local/host salary’ only. The bulk of the salary paid in the home or a third country may not have been declared for tax purposes in the host country. This occurred in countries such as India, where initially there was perhaps lack of awareness of the overall compensation package available

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to employees of international companies. Reviews and reports received by the tax authorities led to amnesties to encourage disclosure. Once such awareness is gained by a tax authority it is seldom forgotten.

Extension Of Offshore Time Limits

HMRC is extending the time limits that apply whereby they can raise an assessment in cases of under declared offshore income. Offshore tax evasion, avoidance and noncompliance pose a threat to the UK tax base. It has been an HMRC focus area for some time now to ensure that everyone pays the tax they owe, including on offshore income and gains. It can take HMRC much longer to establish the facts concerning offshore transactions than in equivalent onshore cases, as it can be more difficult to access the information needed to understand the transactions. This is particularly true where complex offshore structures are used. The existing UK time limits for income tax, inheritance tax and capital gains tax allow an assessment to be made at any time not more than 4 years after the end of the year of assessment to which it relates. An assessment can be made at any time not more than 6 years after the year of assessment if the non-compliance is due to a failure to take reasonable care. Where an assessment involves a loss of tax brought about deliberately, the assessment time limit is 20 years after the end of the year of assessment. This time limit will not change. Due to the additional time that may be required in offshore cases, HMRC may discover an under-declaration too late to assess the tax due under the 4 or 6 year rules. The time limits are therefore being extended to a minimum of 12 years to allow HMRC more time to establish the facts in offshore cases. Individuals with offshore assets must ensure they are clear on their reporting requirements for UK tax purposes. HMRC continue to focus on this area due to their view that not all offshore income is being correctly reported. They now have an extended period to raise assessments in cases where this is not happening. This ties in with the wider theme on increased sharing of information between tax authorities to ensure greater compliance.

Corporate Criminal Offence Legislation

Corporate Criminal Offence (CCO) legislation has been in effect since September 2017, and HMRC’s focus on this is increasing. The CCO legislation covers the failure to put necessary measures in place to prevent the facilitation of tax evasion. A CCO is made when a company has failed to take the necessary steps to prevent tax evasion carried out by an associated person

acting on their behalf in the UK or overseas. Failure to ensure your business is compliant may lead to an unlimited fine, public record of conviction and reputational damage. Here are some of the areas where you may be at risk of non-compliance: • Treating individuals (contractors/gross-paid individuals) as self-employed when their employment status should be employed, leading to under declared national insurance contributions and income tax • Not keeping track of your short-term business visitors - they could have spent more than the allocated number of days in a tax year in a jurisdiction and therefore may be obligated to file tax returns and pay income tax on employment income sourced to that country • If you have sent staff to work overseas to carry out income generating work, there is a risk that the activities carried out may be sufficient enough to create permanent establishment in that country. The associated registration and tax filing must then take place • Depending on the legislation of the country in which you have an associated person, they may be obligated to declare the income derived in that country. In summary, as long as you ensure you have the necessary measures in place, and these are robust and remain up to date, you can minimise the risk of fines and/or convictions applying to your company.

Other Measures

The above are only a few of the ‘measures’ introduced to ensure compliance. Others include: • Approach to tax avoidance. Tax evasion is clearly wrong, but HMRC, assisted by the Press and the Public, have encouraged debate regarding tax avoidance. What is acceptable or not? What is aggressive or not? When do matters such as investment in film schemes, pensions or individual savings accounts or use of Deeds of Variation for Inheritance Tax purposes change from being acceptable to unacceptable tax planning? Whose decision is it? • Your HMRC Customer Relationship Managers recently renamed Customer Compliance Managers (CCM’s). According to HMRC’s website, their primary role is to ensure the business pays everything they owe. This involves building in-depth knowledge of the business and the sectors they in which they operate. The CCM will ensure regular dialouge and discussion occurs. They know the right questions to ask relating to international assignees and will know all about Base Erosion & Profit Shifting (BEPS) and Country-byCountry reporting (CbCR) • Senior Accounting Officer (SAO) rules aim to reduce larger businesses level of tax risk. The rules apply to UK entities with a £2 billion balance sheet total or £200

million turnover and impose obligations on a specified individual within the organisation. Naturally, penalties are chargeable for non-compliance • Necessity to publish your tax strategy – For example, where a UK group, sub group, company or partnership has a turnover above £200 million or a balance sheet above £2 billion, they need to publish their tax strategy. This requirement also applies to UK companies and groups that form part of a multi-national enterprise group that has a turnover in excess of 750 million euros. Penalties apply for non-compliance. This tax strategy should include: • How your business manages UK tax risks • Your business’s attitude to tax planning • The level of risk your business is prepared to accept for UK taxation • How your business works with HMRC • Any other relevant information relating to taxation. The list of measures is only likely to increase.

Summary

The historic approach that some individual assignees and some employers have taken to tax must change. Failure to comply is not, was not and should never have been option. HMRC and other tax authorities rightly recognise that cross border activities give rise to increased possibilities for non-compliance and all are taking active steps to encourage and/or coerce compliance. Ignorance of the rules or wilfully refusing to apply them, perhaps as they are too difficult or too costly, are not acceptable excuses. Maybe Benjamin Franklin was right after all.

ANDREW BAILEY

Andrew Bailey is Global Leader for BDO International’s expatriate tax services and national head of human capital at BDO LLP. He has over 30 years’ experience in the field of expatriate taxation. BDO is present in over 162 countries and is able to provide global assistance for all your international assignments. If you would like to discuss any of the issues raised in this article or any other expatriate matters, please do not hesitate to contact Andrew Bailey on +44 (0) 20 7893 2946, email Andrew.bailey@bdo.co.uk

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A View From The Plane Window – Enhancing The Employee Experience “When I flew recently to Bratislava, I found some time during discussions to look out of the plane window. I saw the industrial complex of Slovnaft chemical factory and the giant Petr‘alka housing estate right behind it. The view was enough for me to understand that for decades our statesmen and political leaders did not look or did not want to look out of the windows of their planes. No study of statistics available to me would enable me to understand faster and better the situation in which we find ourselves” (Havel, 1990). This excerpt taken from Vaclav Havel’s New Year’s address to the nation in Prague on 1st January 1990, is significant for a number of reasons. Much of the free trade we see across Europe and beyond today, some 28 years on, and which fuels the expatriate activity of our global organisations, can be traced back to the world changing events of 1989. The fall of the Berlin Wall is the most obvious to the majority, but the fall of the one-party government of the Communist Party of Czechoslovakia and installation of Havel as the first President of Czechoslovakia can be counted amongst the many outcomes. Moreover, however this section of the speech can be seen as a metaphor for scenarios faced by Global Mobility teams and international assignees alike in terms of the employee experience.

Technology And Data For Programme Management

Fortunately in the corporate world of today we don’t have the same issues with the validity of data Havel refers to in his address. Whilst a recent focus group we conducted reported that the majority of mid-size Global Mobility programmes were not using a technology solution to track and manage their programme, it did not necessarily follow that organisations were not able to produce data and analytics. That said, other industry studies show a bleaker landscape with large numbers of Global Mobility teams reporting deficiencies in being able to report metrics back to their businesses. Indeed, the importance of data and analytics is clearly

highlighted in the RES Forum’s 2018 Annual report as part of its SAFE GM model described in the last edition of International HR Adviser. As Professor Michael Dickmann states in the report; “Successful tracking of assignees and sophisticated data analytics can enable GM departments to analyse their activities and improve them even further while increasing client satisfaction” (Dickmann, 2018). Improving satisfaction of course can only happen if the corporate organisation is tracking data elements, either internally or through its vendor partnerships, which have a correlation to the employee experience. Resulting from their commitment and obligation to what the

It is not just the corporate organisation looking out of the plane window. The employee will take a holistic perspective of their interaction with the organisation through the Global Mobility experience

SAFE model refers to as ‘Flawless Programme Management’, an overwhelming majority of organisations have sufficient processes in place to track the hygiene compliance data elements. However, what is less certain is the extent to which many organisations are able to track data elements which relate to the employee experience. Capturing a variety of data through pulse checks and employee feedback campaigns will support the refinement of programme design with the employee in mind; however, Havel’s point that looking at the situation from above and taking a holistic perspective is surely worthy of consideration. Data analytics offers a lens through which to look at a programme but it may not paint a complete picture. The Global Mobility function needs to ensure that there are a variety of interfaces not only with the employee but with Talent Management, Reward, and other stakeholders, which will help to develop a rich picture of what the employee experience looks like.

An Employee Perspective

It is not just the corporate organisation looking out of the plane window however. The employee will take a holistic perspective of their interaction with the organisation through the Global Mobility experience. Continuing to use the plane as metaphor for the employee experience, it is possible to break the employee experience, from a Global Mobility perspective at least, down into three component parts. These are shown in the diagram opposite. Opportunity - The Engines Just as the engines of an aeroplane propel it forward driving it into the air in conjunction with the wings, the opportunities an organisation creates for Global Mobility drive the employee experience and give it lift off. The means, by which an employee can access information concerning international opportunities; the linkages between talent management and Global Mobility, and the extent to which the organisation values and harnesses the skills employees develop whilst working overseas, all contribute to an organisational environment which incorporates mobility into its functioning. Amongst the recommendations for SMART Organisational Development of the SAFE GM

ENHANCING THE EMPLOYEE EXPERIENCE

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model set out in The RES Forum’s 2018 Annual report, a number of engine components are set out, including devising career planning and progression systems, augmenting the attractiveness of global work to internal staff, and developing brand appeal to external global careerists (Dickmann, 2018). Other industry studies overwhelmingly demonstrate the linkage between successful career progression and international assignments for high potential talent in a large number of multinational companies. Policy and Remuneration – The Fuel Opportunities are fuelled by the organisation having the right structures in place to facilitate mobility. The policy frameworks an organisation sets out need to support the varied types of mobility required by the business, whether it be an immediate need to have the right technical skills in situ, an employee moving into a critical role post assignment, fulfilling talent development or attracting new talent, all need to balance the need to manage cost, the assignment need, and providing the employee and their family with the support they need to relocate. In the last edition of International HR Adviser, we wrote in detail about a variety of flexible policy approaches available to organisations to enable mobility. Having the correct mix of policies and policy structures in place is essential for getting the right fuel mixture into the engine. Furthermore, as the RES Forum’s 2018 Annual report indicates “Younger generations entering the labour market will likely drive a change in more flexible remuneration approaches, which will also have an influence on compensation and benefits in GM” (Dickmann, 2018). Reward and GM professionals need to strike the right balance from a remuneration structure perspective not only in the current environment but also with an eye on changes in future demand. Support – The Wings Having the right support in place before, during and post assignment is essential for assignment success and the employee experience. The RES Forum reports that twice as many people leave the organisation compared to their non-expatriated peers within the first 12 months of repatriation (Dickmann, 2018). That said, the AIRINC 2017 Mobility Outlook Survey showed that only 31% of organisations are tracking retention rates post expatriation (AIRINC, 2017). The aeroplane metaphor is pertinent in two respects here. Firstly, there is an interesting symbolism in looking through the plane window for assignees insofar as windows have frequently been used in literature to represent the separation of a character from the outside world. Emily Bronte’s use of windows in the classic novel ‘Wuthering Heights’ to represent the isolation of

characters from one another and as a barrier to preventing characters fulfilling their dreams, has a poetic symmetry with the isolation an employee and their family can feel, not only when out on assignment, but also upon their return to the home location. Secondly, as the RES Forum report highlights that consideration of an employee’s next role post repatriation is more prevalent the more senior the employee is in their organisation (Dickmann, 2018), giving this cadre of employees a clearer view of the landscape below when looking through the plane window. The absence of career and repatriation planning at other management levels however, is something organisations should respond to both from the perspective of employee engagement and managing the pipeline of future talent. The use of technology in supporting the employee experience is frequently spoken about in Global Mobility circles. The recent RES Forum quarterly report on digitisation reported that “the improved adoption of technology was identified as a way to drive engagement during and after the assignment period to maximise the potential for a smooth repatriation to the home location” (RES Forum, 2018). This may be seen as part of an ongoing trend for self-service systems which has been taking hold for some time. There is however, some evidence that turning to AI is not necessarily a panacea for improving the employee experience. One recent study showed that just over a third of respondents saw investment in new technology as a means to improving the assignee experience. Indeed, a recent focus group run by Sterling with senior Global Mobility professionals supported this position. As one of our participants remarked, “Assignees always want to feel as though they are receiving a high touch service. They want to speak to someone who can put their mind at ease. I do think this might change through new generations, but it does feel as though this won’t be any time soon”. Whilst nobody advocated managing assignees with velvet gloves, there was a strong feeling amongst this group that the emotional connection with the assignee and their family was a key factor in managing the employee experience. The RES Forum quarterly report similarly shows that Global Mobility managers express concern over the negative impact technology may have through depersonalisation of the employee experience (RES Forum, 2018).

Conclusion

The employee experience from a Global Mobility perspective can be seen through a variety of lenses. Whilst this article does not attempt to identify each and every perspective, it advocates adopting a holistic perspective taking into account the interests

of a variety of stakeholders. Capturing relevant data outside of the confines of compliance monitoring will undoubtedly support and help to develop a rich picture of the employee experience. Putting in place superior frameworks to facilitate mobility opportunities, having effective policy and remuneration structures and support mechanisms, which balance technology with the human touch, will all contribute to a positive employee experience. References 1 Havel, V. (1990) New Year’s Address to the Nation Available from: http:// w w w.va c la v h a ve l . c z /s h ow t ra n s . php?cat=projevy&val=327_aj_projevy. html&typ=HTML [Accessed 28th August 2018] 2 Dickmann, M (2018) Global Mobility of the Future: Smart, Agile, Flawless and Efficient. RES Forum 3 AIRINC (2017) Mobility Outlook Survey 2017. AIRINC 4 RES Forum (2018) Digitalization: How technology impacts the world of Global Mobility. RES Forum. Quarterly Report June 2018.

STUART JACKSON

As Account Director at Sterling, Stuart focuses on working with clients to optimise their global mobility solutions . Stuart has worked in global mobility for seventeen years. His broad experience of working with different programme sizes across a variety of industry sectors helps to bring success to clients' programmes and wider business strategies. If you would like to discuss any of the points raised in this article or learn more about Sterling, please do not hesitate to contact Stuart Jackson at stuart.jackson@sterling.com.

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What Can GM Technology Offer HR Business Partners? Effective talent management has always been a vital element in the growth and success of international companies. It’s even more important in today’s business world in which employees are connected and mobile, and where international borders are no longer the career barriers they once were.

providing access to HR for specific areas of the system. Giving HR the power to access instant, real time reports on their assignee population, and even run scenario-based cost estimates or full cost estimates for a specific individual in a matter of minutes is now becoming more common, and is enabling them to respond to business requests much faster than ever before.

Today, the proportion of employees seeking out international experience is continuing to increase. To facilitate this and engage staff, companies must offer attractive and experiential international opportunities. HR and GM teams are working together more closely than ever to ensure success, and GM technology is playing a major role in this collaboration.

HR and GM teams are working together more closely than ever to ensure success, and GM technology is playing a major role in this collaboration

Real Time Data And Analytics

HR Business Partners know and understand the business areas they support. Through consulting and collaborating with the business leadership, they have a clear picture of what the business needs when it comes to global mobility, and act as a key connector between the business and global mobility teams. The trouble is, there is often a need to gather information about a particular move, or the population as a whole very quickly, in order to help the business make fast and informed decisions. This has traditionally been an email to their GM Manager, who then needs to manually gather information on assignment costs and other programme data. Preparing a cost estimate manually, for example, can take a few days as GM teams often have to log in to the HR system for salary data, reach out to relocation vendors for fees and, once these are obtained, send the whole lot to their advisors to run the numbers for tax and social security to complete the picture. Such requests coming in to a GM team without technology can require a significant amount of time and data manipulation to produce the outputs that HR and the business are looking for. With HR under pressure from the business to get the data, GM needs to be able to turn these types of requests around quickly to support their HR colleagues. In today's technology landscape, people are increasingly able to access the information they need at the click of the button. This is particularly true in the consumer market and is now becoming an expectation in the business world. Many organisations utilising GM technology are finding great value from

“During recent discussions with some of our HR Leadership team, a common request was to provide our HR business partners with the ability to “work in their mind” an assignment package with cost. The option for us to create customised cost estimate templates without having to create a new assignment record is a huge gain in itself for the internal GM team, and I anticipate it to be an even bigger gain if we can roll this out via the HR portal". GM Manager, Engineering Services Company. This in itself can elevate the visibility and reputation of the global mobility programme within the business, and encourage more mobility opportunities. With GM technology containing a wide variety of data about mobile employees, vendor services and costs, it can also be used to answer many of the other frequently asked questions from HR. Analytics can provide estimates of the timeframe required to move employees between two particular

locations based on similar previous moves for example. Having this processing power on hand really does enable HR to support business decision-making quickly, whilst simultaneously increasing their visibility and engagement in the mobility process and familiarisation with the programme. This data can also, through collaboration with HR, help GM to shape and evolve their programme and policies to continuously be able to meet the needs of the business. This is where the GM team have a significant opportunity to offer strategic guidance to the business. “With the ability to store all assignment information in one centralised location and easily run reports, the team is in a position to provide meaningful feedback and quickly make programme changes to support business requirements in new locations or in support of new practices and policies”. GM Manager, Oil & Gas Company.

New Analtyical Opportunities

One of the outcomes of the digitalisation of HR, is that systems, historically used for specific purposes (e.g. separate HR databases, performance management tools, compensation and benefits platforms for example) are now able to be connected via integration. This opens up a whole range of new analytical opportunities for HR and GM to collaborate on. Aside from the standard mobility data that HR needs to support the business, GM teams are now able to utilise technology to pull in broader data sets to enable more powerful reporting and analytics and enable HR to access more strategic analytics. This often opens the door to GM Managers to become engaged advisors to not just HR, but to the business. Let’s look at some examples. Much talk goes on about ROI in global mobility. It’s a tricky one to measure in some ways, but there are, through integrated technology platforms, ways of assessing assignment success. Connecting performance management platforms to GM technology can provide opportunities to assess whether an international assignment has provided high potential future leaders with the opportunity to accelerate their careers. Bringing in performance or job grade data for a few years pre-assignment, during the assignment and post-assignment can enable the impact of the international assignment on an employee’s performance, rate of promotion and movement within the business to be assessed. It helps answer the question: “Is

GM TECHNOLOGY investment in international assignments for high potential employees actually resulting in them shining on the global stage, advancing their careers in the business and moving the business forward?” Linking this type of data to a business case focused on personal and professional development can really help prove ROI from the assignment experience. At the other end of the spectrum, some organisations have issues with retention upon repatriation from an assignment. Data flow between systems does not have to stop once an assignment ends. Feeding employment termination data from HR systems into GM technology can enable HR and mobility to spot on assignment and post-assignment retention trends and plan proactive interventions to reduce departures. There may be very low ROI if a business spends a fortune on an assignment, only for the employee to take their new skills and experience elsewhere. Technology can help HR and the business to have adequate time to plan properly for an employee’s return to the right role the home location, through data analytics, employee survey results and automated HR/GM notifications 6 months prior to the assignment end date for example. From a cost perspective, GM technology can also be used to identify potential savings in the GM programme. Analysis of benefit take-up, exceptions and other measures can help GM programmes to evolve and ensure that assignment success is achieved at an appropriate cost. “‘On-demand’ access to reliable and accurate International Assignment (IA) programme data has proved a gamechanger for us. With key programme data (assignment terms, volumes, cost and policy analytics) at the fingertips of the HRDs and Financial Controllers, Mobility has been able to adopt an agile and proactive position to aid the transformation and reshaping of our business and reduce IA programme spend by over 40% within the past 3 years”. Head of Global Mobility, Aerospace Organisation.

Talent Management And Development

Gone are the days of expatriate assignments being all about the financial packages on offer. For several years now, for many organisations the focus has firmly shifted on to development opportunities for the employee. “International opportunities play an important role in the development agenda – Global Mobility needs to partner closely with the Talent & Leadership Development teams to design programmes and meaningful solutions in order to be successful”. Head of Global Mobility, Engineering Company. How this happens in organisations will really depend on their industry, approach and resources available. There are many successful examples of mobility and talent development teams working together to achieve great things, such as designing rotational assignment policies to access different areas of the business globally (and cost effectively) as part of a graduate programme; or managing project employees such that they become part of a global talent pool that is centrally managed and is ready to be deployed anywhere, anytime, with minimal down time between projects. Utilising GM technology can go a long way to facilitating and supporting these initiatives. Flexible technology solutions can be tailored to support the end-to-end workflow, costing and document creation for custom policies and initiatives. Alerts and notifications to GM and HR teams proactively when the end date of a particular rotation or project is coming to an end enables them to work collaboratively ensure a smooth transition home or on to the next location. Technology can also be used to collate information from the employees themselves through surveys and pulse checks. This not only helps to gauge employee experience during the assignment (important information for GM and HR alike) but can add a more subjective data set to help answer questions about suitability and adaptability traits and

What Can GM Technology Offer HR Business Partners?

help identify those who may be a good fit for future, and perhaps more challenging international assignment opportunities. “I envisage gathering a set of predictive analytics that will help us identify employees who can withstand and deliver on their role in tough locations. I want to gather information that will answer: How well do they tolerate ambiguity? How well do they deal with security challenges? Are they easily disconcerted? How well did they adjust in previous moves?”. VP Reward, Media & Technology Organisation

In Conclusion

Monitoring ongoing costs, upcoming end dates and business unit-specific metrics enables HR to maintain an accurate overview of their assignee population, increasing engagement with the GM team and the relocation process as a whole. HR and Talent managers expect access to on-demand tools and real-time data to facilitate true collaboration with their business leadership and GM teams. And now, with access to today’s automation and digitised tools, companies have the opportunity to build and connect their global mobility ecosystems with HR and their extended stakeholder networks. Through integrated technologies and advanced data analytics, HR managers are provided with real-time information to support evidencebased decision making and agility, helping them manage global talent efficiently and effectively.

TIM WELLS

Tim has nearly two decades of Global Mobility experience, including managing in-house programmes for major organisations in the financial services, consumer goods and technology sectors, and servicing a range of clients as an independent consultant. In his role as VP of Technology Solutions, he works with closely with Equus clients to apply the company’s technology to optimise their programmes and solve their complex Global Mobility challenges. Tim has a specific interest in utilising mobility to facilitate talent development. Visit www.equusoft.com for further information.

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And The Survey Says…

Serviced Apartments Reach 1 Million* + Globally The results of the *GSAIR 2018/19 published by The Apartment Service Shining The Light On The Growing Serviced Apartment Industry

Every 18 months the Global Serviced Apartment Industry Report (GSAIR) editorial team including Charlie McCrow, Bard Vos and Mark Harris, come together to review the results of the global survey. This editorial team then uses the results to create the questions, the debate and the content for this much respected industry report that focuses on the growth, the aspirations and challenges that are current in the global serviced apartment industry. It is maybe not surprising to hear that issues that have been logged and identified in previous surveys and the seven reports remain relevant year after year - and because of this, the report is able to follow the journey of the stakeholders of the industry in trying to move these issues, obstacles and challenges towards a solution.

A Snapshot

The significant major benefit of The Apartment Service’s GSAIR report, is that it performs for the industry as a great snapshot, a clear picture of the industry the moment the survey is taken – and with seven surveys now under its wing, GSAIR has followed and recorded the exponential growth of a young and vibrant industry. It has recorded the up’s, the downs, the new entrants, current hot topics, and finally, each edition recognises ‘the new normal’ through conversation and thought leadership. It picks up with topics that are relevant and important – and allows the personality of the contributors to shine through. It remains one of the most highly trusted and referred to industry reports. GSAIR is written by the wider long stay community, for the wider long stay community and is brimming with information, graphics, statistics and thought leadership that encourages all to share the realities of a growing sector.

The Hottest Summer Read Of 2018

Widely celebrated for being the hottest read on the shelves (the serviced apartment shelves of course!) if you want to ‘get to

know’ serviced apartments, you need look no further. You can experience a journey around the world with ‘Regional Reports’; understand how brands plan to develop new products, openings in new locations, and how they are enhancing their services in the Partner Perspectives. This report also provides forecasts, a review of the current supply landscape and features case studies from Graebel, UBS, AIG and other worldwide organisations. It is no surprise that the report again this year has identified that the same issues

(identified in the previous reports) are still relevant eighteen months on, and, even though there has been ongoing development and discussion on the continual and highly debated subjects, such as ease of booking, the need for product and service definition and business model transparency – the report underlines that the industry is still in a forming phase.

Report Methodology

The report is responsibly compiled from a range of primary and secondary global

SERVICED APARTMENTS serviced apartments sector or the wider hospitality industry. In all cases, we present the latest figures available within the market.

Under The Covers Of The Report…. Demand - By Charlie Mccrow – CEO, The Apartment Service

sources, both in or closely aligned to the serviced apartments sector, and takes the views of over 40 industry buyers, suppliers, consultants and trade association representatives. The survey for this edition of the report was carried out during November & December 2017, amongst 6,000 corporates, 2,000 serviced apartment operators and

1,800 agents. A copy of the results is available at www.apartmentservice.com/GSAIR Wherever possible, the results of this year’s industry survey have been compared with previous years to highlight trends within the world of serviced apartments. All other information sources are fully attributed and include other publicly available reports and research around the

‘The rate of growth in serviced apartment usage for business travel, assignment and relocation purposes have maintained their upward trajectory. 21.5% of agents reported that serviced apartments are increasingly used for project or assignment working and 18% reported growth in usage for relocation. Agent involvement in the sourcing and booking of serviced apartments is growing too. Whilst serviced apartment bookings placed via TMCs, RMCs and other agents is increasing, corporates’ usage of serviced apartments fell compared to 2016/17. Over half of corporates now use serviced apartments for business travel, with 39.7% of corporates allocating up to 20% of budget to extended stay. Our survey shows that, year-on-year, corporate use of serviced apartment for business travel has fallen by 9%, assignment/ project working by 18% and relocation by 8%. That is not to say that adoption is no longer growing, however, it appears that the rate of that growth has slowed, as Fig 2 shows. We do not believe this is evidence of any decline in demand for serviced apartments. The factors that make serviced apartments a compelling alternative to hotels remain unchanged from our previous report, with brand recognition and policy compliance ranked alongside traveller/assignee preference in the top three criteria. However, this shows that corporate adoption has perhaps reached a temporary ceiling. 56% of corporates agree or strongly agree their serviced apartments use has gone as far as it can, based on current needs and supply. This also suggests that the serviced apartment sector has reached a new level of maturity. Procurement has recognised that a different approach is required when sourcing extended stay properties compared to hotels. Our survey found that fewer corporates now include serviced apartments in their annual RFPs (down 15%), suggesting that serviced apartments have found their niche as a standalone travel category. Further evidence of growing maturity comes from the changing ways in which corporates procure serviced apartments. As Fig 6 shows, fewer corporates now book direct with apartment operators, instead using specialist agencies like The Apartment Service, TMCs or RMCs, with 36.84% of corporates mandating an agency channel for apartment bookings. The point is that procurement is increasingly being managed by agencies

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their travellers to select/book their own accommodation, as Fig 8 shows. Guest experience ranks highly in the list of corporate priorities. As Fig 9 shows, just under half of corporates agree or strongly agree that the guest experience is now as important as cost or total cost of trip in the choice of accommodation provider.

Guest experience ranks highly in the list of corporate priorities. As Fig 9 shows, just under half of corporates agree or strongly agree that the guest experience is now as important as cost or total cost of trip in the choice of accommodation provider

that are already managing their clientsâ&#x20AC;&#x2122; hotel spend, thereby re-affirming wider acceptance of the serviced apartment option, within the supply chain. The outsourcing of programme management to agents also enables cost and traveller tracking to be consolidated into established reporting tools along with the

other accommodation spend. A third factor in this growing sector maturity is the latitude afforded to travellers and assignees in making their own accommodation choices. 36.84% of corporates allow travellers to make their own accommodation choices via a mandated agency channel, whilst 47.37% allow

Personalisation and digitalisation are two travel-sector mega trends that are having a big effect on the serviced apartment product. Traditional reception desks are being replaced with informal seating areas where front desk teams can great their guests and make them feel welcome. Some operators hold open evenings for guests to meet and interact with each other. For example, Living Hotels by Derag in Frankfurt, Germany, hosts an open stage evening where street artists and guests alike are invited to entertain in the reception area. However, traditional barriers to adoption have still to be overcome â&#x20AC;&#x201C; especially the shortage of apartments in required locations. As Figs 9 and 10 show, the sector also needs to deliver more if corporate usage is to break through this glass ceiling. The

SERVICED APARTMENTS accessibility of home share or private rentals as alternatives to both serviced apartments and hotels continues to disrupt. Just over 30% of corporates now allow their travellers/ assignees to use a short-term rental provider, of which 23.63% do so direct whilst 10.53% source via their mandated agent. However, short-term rental providers are a way off gaining significant traction amongst corporates. 42.11% of those we surveyed claim they do not permit their travellers or assignees to use them, with 28.95% yet put any formal policies in place around their usage’.

Did We Whet Your Appetite?

The extract shared here of the report covers just the first 14 pages of the 128 page strong GSAIR 2018/19. This 7th edition again asks more questions than it answers - which is where its value truly lies. As an eternal optimist, even reading the quote from my CEO, Charlie McCrow, where he discusses the statistics from the survey advising that ‘56% of corporates agree or strongly agree their serviced apartments use has gone as far as it can, based on current needs & supply’ creates a drive in

me to continue to source and supply global programmes to the 44% of corporates that haven’t yet seen the light. Reference (*the global serviced apartment industry report, published by The Apartment Service - TAS Global)

JO LAYTON

MD Group Commercial Sales, The Apartment Service. Jo Layton is MD - Group Commercial Sales at The Apartment Service. She has successfully established The Apartment Service’s new Alliance brand as part of her overall remit to develop the company’s successful agency, network and Roomspace brands. Layton joined from BridgeStreet where she was responsible for sales and marketing throughout EMEA and APAC.

The 2018 Global HR Conference FOR GLOBAL HR PROFESSIONALS ONLY

Monday 8th October 2018, from 12.30pm – 5pm The Adelphi Building, Smith & Wollensky, 1-11 John Adam Street, London, WC2N 6HT Places are limited, so delegates do need to pre-register. Registration takes place from 12.30pm where you can enjoy complimentary refreshments and network with colleagues in the industry, and the first seminar will start at 1.30pm. Permanent Transfers - Sponsored by ECA International and hosted by Lewis Turner Global Mobility Trends and Tax Update - Sponsored by BDO LLP and hosted by Karen McGrory How to Implement a Business Traveller Management Programme - Sponsored by GT Global Tracker and hosted by Liam Brennan Immigration Update - Sponsored by Kingsley Napley LLP and hosted by Ilda de Sousa Global Mobility in an Uncertain World - Sponsored by Santa Fe Relocation

INTERNATIONAL HR ADVISER AUTUMN

The Challenges of Implementing Global HR Systems and Processes Over the last few years, we have seen an increasing number of multinationals implementing Globalised HR Systems, often in conjunction with Global Shared Services centres or 'Control Towers' structures. These can take many forms, but usually involve a combination of the following: • Design, adaptation and implementation of specific HR process workflows, commonly throughout the entire employee lifecycle (or as it's sometimes known, 'hire to retire') • Incorporation of a Shared Service Centre, involving finance, HR and other back office functions • Relocation of existing roles from their current locations into the Shared Service Centre, often across borders • Changes to roles and streamlining of teams. Our involvement in these projects has given us a front row seat in dealing with these issues, and the purpose of this article is to share this learning as well as highlighting common issues, mistakes, challenges and misconceptions, so that readers who are seeking to implement their own such processes are prepared. We have focused in this article on the design and implementation of HR Systems and Processes. Dealing with the issues surrounding Global Shared Services centres or Control Towers structures is an article in its own right. Implementation of Global HR Processes often proceeds in stages: • Process Design and Review • Implementation • Optimisation We look at each of these in turn below:

Process Design and Review

Many HR Systems and Solutions focus around standardised global HR process workflows, for example, for voluntary or involuntary separation, employee data management, application and recruitment processes etc. These products are sold by a variety of vendors and vary from 'off the shelf' systems and workflows, to bespoke products designed around the needs of a specific business. However, in our experience, whether ‘off the shelf’ or bespoke, these products, workflows and processes are often primarily procedural or analytical in nature and lack commercial,

organisational or indeed, crucially, local legal context, often being designed within a specific market in mind (often the US market) and not factoring in local legal requirements. This means that whilst these processes work functionally 'out of the box', there is significant risk of breaching local data, employment and other laws if they are used without modification in any jurisdiction other than that which they are designed for. In simple terms, there is no 'one size fits all approach', meaning that it is critical that each process is validated for each of the local jurisdictions is intended to operate in.

In simple terms, there is no 'one size fits all approach', meaning that it is critical that each process is validated for each of the local jurisdictions is intended to operate in Validating the processes locally requires a business to engage with their key local HR stakeholders and their local legal advisers in reviewing the workflows for the following: • Any formalities or necessary steps that need to be included (e.g. in disciplinary invitations) • The key information which is legally required to be included at each stage • Any 'hidden' implications of particular elements of the system or process which might trigger a specific employee or consultation right • Any matters covered by a local or national collective bargaining agreement (which

would of course not be factored into the system or workflow) and which might require consultation • Any notification obligations that may be required e.g. to a local labour authority • Specific classes of protected employee • Any practical issues which need to be considered – for example, relationships with Works Councils, non-binding expectations of consultation on certain matters with employer representatives, etc. An ineffective or incorrect system or process, or an inadvertent error or omission (which almost always, in our experience, arise due to lack of local knowledge), could have significant legal as well as commercial consequences. For example, if a dismissal is found to be procedurally unfair (e.g. because the process omitted a key step), whilst some jurisdictions allow for financial compensation as a remedy, others will find the resultant dismissal void, meaning the employee has to be reinstated. Given employment cases in some jurisdictions can take several years to appear before the courts, the potential financial losses to an employer are large as they would have to not only reinstate a disgruntled employee, but also pay them back pay for the period they were not working. Additionally, some jurisdictions impose criminal sanctions for certain breaches, usually where an employer has failed to comply with the obligations that it owes a Works Council, Trade Union or other employee representative body. These criminal penalties may be levied either against the Company or, in some cases, nominated individuals such as the local Managing Director or HR Director. Finally, local HR and operational teams need to have confidence in the 'new' system, otherwise they will find ways to circumvent it, meaning the efficiencies that the system aims to bring will be lost. It is important that the process review is not prescriptive and does not seek to completely re-design the system and/ or accompanying workflows in each country. Simply put, to do so would defeat one of the main objects of these systems, being cost savings, consistency of approach and efficiencies within the global HR process. It would also make the idea of an HR Shared Services Centre or Global Business Solution virtually unworkable. Any information added can (and indeed should) be limited to key local requirements rather than best practice in most cases since best practice, while nice

GLOBAL HR SYSTEMS to have in place, is not strictly necessary. The process review, whilst vital, therefore needs to be undertaken at a high level and with a sensible and experienced eye on the commercial risks. It also needs a project manager who understands the basics of local law in as many of the key jurisdictions as possible, as well as the particular pressures of the client's business and operations, as they can ensure that the timetables are realistic whilst also keeping external counsel focused on the relevant issues and at the appropriate level of detail. One common flaw we have seen at the process design stage is a lack of engagement with those within the HR function who have the requisite knowledge to 'localise' the processes. This is understandable, as, due to the highly confidential nature of these projects, businesses often prefer to involve local experts at the last minute only. However, whilst there are clear advantages to this in terms of confidentiality, lack of local knowledge or review at an early stage can lead to delays later on. Ultimately, designing and implementing these systems (whether as part of a shared service centre or not) costs a lot of time, effort and money. Even if they are bought 'off the shelf', the systems, workflows and accompanying software that goes with them are not cheap (whether in financial terms or simply in terms of the time and effort commitment required from senior leaders within the organisation), likewise any investment in a Shared Service Centre or Global Business Solution. As such, businesses in our experience often have a strict timetable to which they want to operate – frequently one to which they have committed in communications with their shareholders or the markets. A recurring challenge is where HR or legal teams (whether internal or external) are asked to validate these systems globally, often within a short time scale. In addition to choosing the right project manager, success will depend upon the project being clearly and concisely managed and the central project team having a strong working relationship with quality local counsel who most importantly, are experienced in reviewing these types of systems and processes. It is also important that they are able to build relationships internally in short order – getting these systems up and running requires everyone to understand their role and to 'pull together'. There is often little time to spare educating local counsel (or indeed local HR) on the reasons for these HR systems or how they are intended to work, particularly as global sharing of information and/or global decisionmaking is viewed with a somewhat sceptical eye in some jurisdictions. The project team also need to have an understanding of the appropriate level of amendment to propose – in our experience, many counsel, on reviewing

these systems and processes for the first time, are resistant to their implementation as they view them as problematic under local law. We therefore recommend including a clear planning phase to these projects, with key milestones mapped out, including time for engagement with and feedback from local HR and counsel. In our experience, the last thing that HR (or indeed legal) want is to be viewed as a roadblock to implementation, but it is critical that they are both involved early enough in the design process if delays are to be avoided.

A recurring challenge is where HR or legal teams (whether internal or external) are asked to validate these systems globally, often within a short time scale Implementation

Once the design phase is finished, there is often a temptation to feel the hard work is done - if only! Whilst that can seem superficially to be the case, given the long, fraught hours involved in trying to collate and standardise advice across multiple time zones, the hard work does not stop there and, if anything, it's just the start. Implementing these systems and accompanying processes often involves significant change for employees (both within the HR population and the wider employee population). For example, HR employees may see their roles change or be relocated, sometimes by way of an auto-transfer. Non-HR employees may see a significantly different way in which they interact with HR, or the introduction of more centralised or overseas monitoring of them. Each of these matters are things which may, in some countries, require either individual consultation or consultation with employee representatives. Often, consultation should take place before any decisions are reached, in some cases before any proposal is made public. Failure to comply with these obligations will likely lead to the financial

and/or criminal penalties referred to above. For this reason, the implementation phase will likely require carefully planned consultation and communications, the timing of which may vary from country to country both for commercial reasons (e.g. a staggered roll-out to 'stress-test' the new system) and legal ones (e.g. where any communications have to be 'cascaded' through the employee representatives and consultation with them needs to be genuine and suitably detailed). It is important that this is factored into the project plan at an early stage rather than being a lastminute realisation and resultant 'panic'. Where consultation with employee representatives is to be undertaken, we would also recommend identifying the key individuals to that relationship (e.g. the local MD/ HRD) and making sure that they are on board with the project, as they will be the ones that have to 'sell' it to the employees and their representatives. There may of course be a need to 'sell' the project to local operational and HR teams. It is tempting when planning or considering implementing these projects to assume that everyone will see them as beneficial to the overall efficiency of the company, allowing for greater consistency of approach and a pooling of resources. Whilst that may well be the case, there will inevitably be pushback not only from those whose roles are directly impacted, but also from those who are used to have HR 'on their doorstep' or reporting into them.

Optimisation

Once a system and/or process has been implemented, there will inevitably be teething issues. Often, this is seized upon by those within the local entities who wish to revert to the former structure and processes – this should be refused. Instead, whoever internally 'owns' the new HR systems or processes should actively engage with senior staff in country and find out what is working for them (and what isn't). This can then be fed back into design updates, although again it would be sensible to try and prevent these from diverging too much from the desired 'standard' if commercially possible. The same caveats apply as for the design phase and the implementation phase – there may well be 'hidden' issues which require consultation and/or specific processes to be followed. We would always therefore recommend that any changes (other than minor changes) are reviewed by the relevant local counsel who carried out the first review.

So What Can Be Done To Make These Projects Run More Smoothly?

We've identified below our ten top tips for planning and implementing a successful global HR process. These are: 1. Do your due diligence – identify the countries and entities potentially

INTERNATIONAL HR ADVISER AUTUMN

affected at an early stage, as this will help to identify any potential 'hotspots'. Prepare a project plan – this will ensure that any key timings and milestones are identified early on and a realistic timeline prepared. Engage with key internal and external stakeholders and experts at an early stage – their advice will be key on potential timing issues and hotspots. Gather any internal knowledge that you may have – for example, from other projects, outsourcings etc. that you have been involved with (for example, we use our proprietary Global Edge database to gather information initially without the need to consult local counsel, which saves time and cost). Find the right project manager(s) – it's unlikely that those running the project will be experienced in delivering a project of this size across multiple jurisdictions. It is therefore critical that the right project managers are chosen as there are a lot of particular nuances to implementing these systems and processes. Choose the right local counsel – they need not only to understand how local law impacts on these specific systems and processes, but also how to clearly and succinctly express these issues.

The project team simply will not have the time to review and summarise lengthy, detailed advice. It has to be presented in a form that can be presented to the Board. 7. If there is to be a staggered roll-out, identify the primary jurisdictions as soon as possible and focus resources accordingly – this will allow for more efficient use of internal and external resources. 8. Ensure the project team have access not only to the HR workstream, but also any operational and commercial workstreams – this will ensure that any commercially key information is factored into the approach and will avoid any of the workstreams becoming 'out of step' with the others. 9. Schedule regular catch-up calls, both globally and locally! This is vital, as it allows for a regular flow of information from the central project team to the relevant local team(s), and vice versa. 10. Ensure that communications are carefully planned – in some cases, due to strict consultation obligations, there may need to be a 'communications cascade' where e.g. local Works Councils receive information under confidentiality notice 2 days or more in advance of the main communication going out to employees.

DAVID REGAN

Article by David Regan and Chris Lynn, Squire Patton Boggs. Squire Patton Boggs operates 47 offices in 20 countries. Please visit www.squirepattonboggs.com for further information.

THE POWER OF BENCHMARKING

The Power of Benchmarking Expat Academy is a membership organisation for in-house Global Mobility professionals and one of the most valuable membership benefits we provide is our unique benchmarking service. If an Expat Academy member needs to find out how other Global Mobility Professionals approach a certain situation, then they send their question to us and we ask our network of members on their behalf. We consolidate all responses and distribute the answers back to the network for everyone to learn from. The whole process is anonymised giving each respondent the confidence that their involvement does not violate any anti-trust laws. If you’re still wondering about the value of benchmarking perhaps the following definition may persuade you: Benchmarking is “A measurement of the quality of an organisation's policies, products, programmes, strategies, etc., and their comparison with standard measurements, or similar measurements of its peers. The objectives of benchmarking are: 1. To determine what and where improvements are called for 2. To analyse how other organisations achieve their high performance levels 3. To use this information to improve performance.1 The Expat Academy team are literally walking encyclopaedias of knowledge. We hear what is on the minds of hundreds of Global Mobility professionals every week and we pull it all together into a vault of information, available at your fingertips via the Expat Academy App. In the spirit of sharing, this article highlights some of our latest benchmarking questions with a summary of the responses.

Unmarried Couples Going To Indonesia

Have any companies sent an expat to Indonesia on assignment who has an unmarried partner who has accompanied them? If so, did they encounter any problems with continually using the single entry visa route (as non-married cannot have a dependent visa)? We are concerned there is a risk with a long-term stay using single entry visas.

Those who responded to this question were equally concerned so we called in one of our expert Network Sponsors, Emigra, who advised: Unmarried partners are not eligible for a Dependent status in Indonesia and as such the only option in such cases, is for the applicant to secure a “Socio Cultural Visa/ Visitor Visa”.

Benchmarking is “A measurement of the quality of an organisation's policies, products, programmes, strategies, etc., and their comparison with standard measurements, or similar measurements of its peers This visa is initially issued for a period of 2 months and can be further extended in Indonesia twice for a further period of two months per extension – i.e. on a single Visa the applicant can remain in Indonesia for a maximum of 6 months. Post this, the applicant will need to exit Indonesia and secure a fresh Visa for any additional visits - there is no cooling period, however, the applicant will need to provide all supporting details including flight tickets and hotel confirmations as needed. Whilst this is not an ideal situation, based on the immigration regulations this is the only viable/compliant option available. As a result of this legal restriction, companies do not tend to use long-term stays in these circumstances.

International Store Openings In The Retail Sector

Do any retailers send store staff abroad to assist with new store openings? Most of the respondents to this question rarely send retail staff overseas to help with new store openings. For those who do, these tend to be more senior level employees such as store directors/managers and unit managers and the trip tends to be very short in duration.

Global Mobility Considerations For A Global HR System

We currently have a number of HR systems and are looking to move to one global HR system. I have a few requirements we need from a Mobility perspective to be considered as part of the new HR system. I would be interested in hearing from anyone who works for a company that has a global HR system, or is implementing one, as to the key requirements that are included to support mobile employees and link core HR data to Mobility. The responses to this question were comprehensive and so very helpful. Many tips came out from the answers including: • Understand how an international assignee will work in the system in terms of their profile. Will it be one profile that moves from home to host, does this impact anything like annual salary review, pension etc. which will depend on what data in the HR system is integrated to other systems etc? • Limit the number of home languages, as any customised labels for data fields will need specific translation • Agree a position on exchange rates for HQ currency reporting • Ensure any outputs from the system by way of contractual positions are also in hard copy where legislation requires it, rather than a system generated statement • Consider how multiple payrolls will work • Have a consistent agreed approach in all countries to capture employee data. For example, use the same field in the system to store start date, and/or continuous service date if transferred from another location and prior service is still honoured. This will feed in to future entitlements of benefits etc. • If you want to link your mobility programme to performance and potential criteria within your talent management systems, this info will need to be available at a global level to review for example, your top 50 performers.

INTERNATIONAL HR ADVISER AUTUMN

Assignment Buddies

Does your firm use assignment buddies to help the assignee settle in to the new location? Interestingly, many of the respondents to this question try to encourage connections in the home and the host location and consider the time spent by buddies as “work” rather than “goodwill”. However, none have a formal buddying programme in place.

International HR Adviser

Conclusion

Benchmarking enables you to learn quickly from others and gain comfort that your ideas and approach are not widely out of step with current market practice. Of course, it can’t be relied upon in isolation. Challenging preconceived ideas is also a key skill of the seasoned Global Mobility professional, which is where the dialogue at our Network Huddles complements the information gained through benchmarking beautifully. If you’d like to find out more about how you can get involved email emma@ expat-academy.com or visit our website www.expat-academy.com Reference 1 http://www.businessdictionary.com/ definition/benchmarking.html

EMMA HOLDER

Emma specialises in organisation effectiveness and expatriate management and has spent over 20 years working in Global Mobility as both a specialist consultant and in-house corporate manager. Emma started her career in International Tax at Arthur Andersen, moved into International HR with PwC and then moved in-house to work for Goldman Sachs and Diageo plc. Emma is a Director at Expat Academy Ltd and has overall responsibility for technical training and consultancy. She facilitates many cross-industry Global Mobility forums and is at the cutting edge of the latest trends and news in the Global Mobility Industry.

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The Global HR Conferences please email helen@internationalhradviser.com and put ‘Newsletter Please' in the subject

DIARY DATES

OCTOBER 2018

International HR Adviser The Global HR Conference

8 October 2018 -Smith & Wollensky, London This free one-day conference is for Global HR professionals only. Further details are on the inside front cover. The seminar programme will cover: • Permanent Transfers - ECA International • Global Mobility Trends and Tax Update BDO LLP • How To Implement a Business Traveller Management Programme - GT Global Tracker • Immigration Update - Kingsley Napley LLP • Global Mobility in an Uncertain World Santa Fe Relocation To register your free place, please email helen@internationalhradviser.com.

Worldwide ERC® Global Workforce Symposium

17-19 October 2018 Seattle, Washington, USA Come together with industry builders, innovators, and disruptors to share distinct global perspectives and build talent mobility solutions for today and the future. Network, benchmark, collaborate, and reconnect with industry peers and experts against the backdrop of breathtaking views in one of the United States’ largest port cities. Gain insights on the future of work from opening speaker Seth Mattison, innovator, author and futurist, and participate in a “lunch and learn” on creativity and innovation with award-winning entrepreneur, Josh Linkner. Visit www.worldwideerc.org/gws.

Worldwide ERC® India Global Mobility Summit

31 October 2018 – Bengaluru, India Bengaluru’s thriving IT hub, start-up friendly ecosystem, burgeoning R&D environment and robust multicultural workforce present a perfect combination for fostering innovation. We invite you to embrace that mindset this October, innovating with other professionals across all spectrums of the talent mobility journey. A full day of programming will focus on global mobility, HR, expatriate support, immigration, international taxation and compliance. First-time corporate HR mobility practitioners are eligible for complimentary registration. Visit www.worldwideerc.org/events

NOVEMBER 2018

FEM EMEA Global Mobility Summit & EMMAs – London

8-9 November 2018 Intercontinental - O2, London, UK Don’t miss the opportunity to attend the FEM EMEA Summit & EMMA, as FEM celebrates its 10 year anniversary this is one not to be missed. Join likeminded Global Mobility professionals to share best practice and network while coming away with valuable insights and ideas for your own programme. Find out more information at www.emea. forum-expat-management.com

World Employee Experience Summit

8-9 November 2018 Amsterdam, The Netherlands Join this conference to discuss the best practices of boosting your employee experience transformation as well as long term benefits of such investment for workforce productivity and organisational performance with the top HR, Talent and L&D professionals. For more information and registration please follow the link: www.luxatiainternational.com/ product/world-employee-experience-summit

Nordic Business Transformation - Transform Your Back Office Through Digital Innovation & Process Excellence

19th – 21st November 2018 Stockholm, Sweden This event will dive deeply into understanding how and where you can effectively deploy technology, analytics and change management strategies in order to achieve operational excellence in your back office. Check out the full schedule of the 3 day’s you don’t want to miss – visit the website for everything you need to know about the region’s leading Business Transformation event. Visit our website and find your inspiration, discover new ideas, and build valuable networks. Visit: www.nordicbusinesstransformation.com IHRA reader Discount Code: IHRA10

GloMo Training – Essential Global Mobility

26 November 2018, 10.00-16.00 London, UK This course will provide you with an insight into Global Mobility jargon, acronyms and the assignment life cycle. Plus, an overview of the tax and immigration considerations when managing globally mobile employees helping you piece together the complicated jigsaw that is GM. Relevant to those reasonably new to GM or who work in a specialist area and are keen to broaden their knowledge. Cost: £600 + VAT (complimentary to Expat Academy members) For more information go to www.expat-academy. com/essential-global-mobility or to book direct e-mail bookings@expat-academy.com

Chief Learning Officer Forum, Fall

27-29 November, 2018 Boston, MA, USA The CLO Forum, Fall is North America's leading learning and development conference for Chief Learning Officers, Chief Diversity Officers, Chief HR Officers, Organisational Leadership and Employee Engagement Executives across the learning and development landscape. Based on the success of our 2017 event, CLO Forum, Fall 2018 will bring together the best of the best in the L&D industry. 83% of our attendees are Director-level or above and we handpick our senior level speakers from a number of different industries. Every aspect of the event is designed to facilitate networking and our sessions are offered in different formats to peak your interests and help you tackle specific

issues that are directly related to your role. International HR Adviser subscribers get 20% off with discount code ‘IHRA20’. Visit coriniumintelligence.com/chieflearningofficerfall/ registration-20-discount-primary For more information about CLO Forum, Fall visit coriniumintelligence.com/ chieflearningofficerfall To contact a member of the CLO Forum team, email us at inquiries@ coriniumintnel.com

Worldwide ERC® Mexico City Summit

28 November 2018 – Mexico City, Mexico Inspired innovation at the North and Latin American crossroads Mexico City is one of the most important and influential powerhouses for global business in the Americas. This November, the vibrant capital city is the place for you to be for a knowledgesharing event shaped by the global, regional and technical developments and innovations that are driving talent mobility. Reserve the day and benefit from the information that HR, legal, tax and other mobility experts will share through an engaging mix of presentations and small-group discussions. Visit www.worldwideerc.org/events

DECEMBER 2018

Worldwide ERC® São Paulo Summit 2018

4 December 2018 – São Paulo, Brazil Embrace the future with optimism. Brazil’s must-market status for multinationals has been earned by successfully weathering uncertainties and remaining a centre of optimism for growth. Plan to harness that spirit in São Paulo in December, embracing uncertainty and change by boosting your talent mobility knowledge and skills. Startups, long-established firms and all organisations in between will benefit from the dynamic exchanges, small-group interactions and unique learning opportunities. Take the first step to readiness for what’s to come in talent mobility tomorrow by reserving your place at the Summit today. Visit www. worldwideerc.org/events

Bite Size Briefing

4 December 2018, 10.00-17.00 London, UK A training day for the Expat Academy community. A chance to listen and learn about the latest trends, get technical updates and industry insights from the team and their technical training partners. The main aim of the day is to provide intellectually challenging content which will enhance your professional development and maintain your specialist GM knowledge. Expat Academy members only For more information go to www.expatacademy.com/bite-size-briefing or to book direct e-mailbookings@expat-academy.com

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