SUMMER 2022
ISSUE 89 FREE SUBSCRIPTION OFFER INSIDE
International HR Adviser The Leading Magazine For International HR Professionals Worldwide
FEATURES INCLUDE: Accessing Global Talent - Embrace The New Era Global Mobility In Times Of Disruption: 3 Ways To Minimise Global Mobility Programme Risk The Language Of Payroll • Global Tax Update • Collect Key Data Points For Success Buying Mobility Software - Are You Vertical Or Horizontal? Global Mobility: Leadership Requires Presence FIDI 2021/22 State Of The Industry Report Best And Worst Destinations For Expatriates ADVISORY PANEL FOR THIS ISSUE:
CONTENTS
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Accessing Global Talent - Embrace The New Era Rumi Das, Beth McConnell, James Hobley, Global Workforce Consulting, Deloitte LLP
Global Mobility In Times Of Disruption: 3 Ways To Minimise Global Mobility Programme Risk Sheryll Young, Vialto LLP & Raj Mann, Vialto Partners
The Language Of Payroll Andrew Bailey, BDO LLP
Global Tax Update Andrew Bailey, BDO LLP
Collect Key Data Points For Success Chris Lagerman, WHR Global
Buying Mobility Software - Are You Vertical Or Horizontal? Liam Brennan, TST International
Global Mobility: Leadership Requires Presence Dr Phil Renshaw, Visiting Fellow, Cranfield University, Dr Jenny Robinson, Visiting Fellow, Henley Business School & John Rason, Santa Fe Relocation
FIDI 2021/22 State Of The Industry Report FIDI
Best And Worst Destinations For Expatriates Internations
Directory
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Helen Elliott • Publisher • T: +44 (0) 20 8661 0186 • E: helen@internationalhradviser.com Ben Everson • T: +44 (0) 7921 694823 • E: ben@internationalhradviser.com International HR Adviser, PO Box 921, Sutton, SM1 2WB, UK Cover Design by Chris Duggan In Loving Memory of Assunta Mondello Origination by Debbie Morgan and Printing by Gemini Group The International HR Adviser team work with a British planet positive printer, with a commitment to best practice environmental management including achieving the top score in Europe for the Green Leaf Awards, full FSC Certification, and ISO14001. Well managed sourcing of both virgin pulp and recycled papers, in addition to carbon balancing ensures that you can enjoy International HR Adviser with a clear eco conscience. 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.
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Accessing Global Talent Embracing The New Era Much is currently being written by journalists, business leaders, academics, and management consultants on the increasingly complex and diverse world of talent. We are being warned of the ‘Great Resignation’, that the “global jobs market recovery has ‘gone into reverse’ ”(1), and are being asked “are employers heading for a talent shortage perfect storm?”(2). But what are the causes of these issues and how can organisations respond to the changing face of talent management? In a recent 2022 CEO Deloitte survey, chief executives reported optimism about growth amidst uncertainty marked by talent supply chain disruptions and the continuing effects of the COVID-19 pandemic. Talent remains a top concern for CEOs, with 71% of CEOs citing global labour/skills shortage as their top external challenge to their business strategy(3). From a global talent perspective, there are generally five key forces creating a perfect storm for change and the race for talent: 1. Changes in the workforce: there are now four generations in the workforce, each with their own dreams, expectations, and worries about the future. Understanding these groups is key to attraction and retention strategies. 2. The Digital Age: technology is allowing us to do things we never thought possible before at exponential speed. Increasing numbers of operational tasks are being automated, with organisations becoming more focused on digital. However, there is simply not enough core technology and digital skills related talent to keep up with demand. At the start of the COVID-19 pandemic, the World Economic Forum estimated that 50% of the existing workforce will need to reskill by 2025.(4) 3. The shifting geopolitical climate: the trade and immigration landscapes are becoming increasingly complex, and that complexity has been increased by measures taken in response to COVID-19 and political conflicts. 4. The rise of (domestic and international) remote work and increasingly dispersed talent: the technology required to work
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remotely for large numbers of office-based employees has been possible for many years, but only through the COVID-19 pandemic did it become a cultural possibility, and some would argue a health/wellness necessity. Many employees are finding they can live in locations without a physical proximity to traditional places of work and employers are finding new talent outside of their historical ‘catchment’ areas/countries. 5. Evolving employee expectations: increasingly employees expect empathy, inclusivity, equity, and a ‘consumer-grade experience’(5) in the workplace. Career trajectories are shifting from a traditional linear approach to more agile curated portfolios of roles and experiences. CEOs are becoming increasingly aware of this and a recent survey reported the top three areas they feel that their organisations lack stakeholder trust on as: (1) Diversity, equity and inclusion (41%), (2) employee experience (30%), and (3) innovation and technology.(6)
Many organisations are now taking a more global view of talent and, as a result, are unearthing many potential opportunities for both their business and their employees
The Challenge And The Opportunity
To counteract these forces, many organisations are now taking a more global view of talent and, as a result, are unearthing many potential opportunities for both their business and their employees. Some of these opportunities include: • Increasing the talent pool available to an organisation. • Enabling the career aspirations of existing employees through a greater number of opportunities. • Increasing an organisation’s ability to deploy key skills to where they are needed most within the organisation. However, realising these opportunities is not without its challenges which typically fall into one or more of the following: • Finding a way to overcome a lack of infrastructure to analyse and evaluate the skills available within and outside of the organisation on a global basis, often leading to siloed domestic recruitment strategies. • Working with existing HR functions/ capabilities that tend to be both domestically focused and/or structured around technical disciplines (e.g., talent acquisition, learning and development, workforce management etc.) and may not be able to solve talent supply chain problems on a global or cross-border basis. • Overhauling existing processes that involve Global Mobility, the function which ordinarily supports the temporary or permanent cross-border movement of employees and external hires, who are often involved late in the selection process and treated as a separate function to wider HR/Talent. To overcome these challenges, a new global talent approach is needed. One which has a border-free mindset and utilises crossfunctional or multi-disciplinary teams to set talent programmes directly in response to business imperatives and help deliver the key skills required by the organisation to where it is needed most. Imagine an approach where talent acquisition professionals work as one global team, alongside global mobility, tax and legal professionals, and business leaders to review business requirements, determine talent needs, identify pools of talent (internal and external), and deliver a strategic programme to acquire and internationally deploy talent when and where it is needed, efficiently and compliantly.
INTERNATIONAL HR STRATEGY From being reactive, with possible disconnects due to functional silos, organisations would be able to shift to a more proactive approach, better able to plan, and adopt practical capabilities to utilise global talent, once identified. This does, of course, require robust HR operations, but can better realise the benefits of proactive workforce planning, and support improvement in employee experience. At the core of this concept is the need for organisations to have a clear understanding of the wide range of talent onboarding and deployment approaches. As well as domestic hiring, organisations can explore alternative means of talent deployment such as international assignments, local-tolocal employee transfers, permanent remote working, virtual assignments, business travel, global employment organisations, global employment companies, and more. This exploration does not necessarily mean that every organisation will utilise all options at their disposal, but they will have a clear rationale for which approaches will work for them, together with the potential value proposition, e.g., use of virtual assignments will not only allow an organisation to deploy skills quickly, but also offer a global experience to employees who may have previously been unable to physically relocate. This should also not be a one-time exercise; strategies should be frequently revisited to ensure the approach taken remains fit for purpose.
A Future-Proofed Model
The business imperative of the race for talent, the enhanced ability of technology
ecosystems, and a global mindset culture forms the foundations to allow a new approach to be embedded. The ‘new Global Workforce model’ (Figure 1) seeks to take advantage of all these aspects, responding to the changing forces in the world of talent. With the overarching business strategy at the centre, a new internal cross-functional/disciplinary group known as ‘Global Workforce Advisory’ can work with the business to identify and source key skills that may be required. Solutions and/or programmes can then be created that allow for the self-service management of talent by individual business leaders (e.g., requests for project management or data expertise) which are constantly reviewed and iterated through the use of analytics and a continuing focus on return on investment. We envisage such solutions and/or programmes to focus on resolving issues with one or more of the four key elements of the talent lifecycle (BUY - acquisition of new talent; BUILD - generating the skills and capabilities required; BORROW deployment of talent; PLAN - succession and career planning) and to consider them from an international perspective. Example solutions could include hiring of talent on a permanent remote basis in a talent hotspot; virtual assignments to provide global opportunities, and learning experiences for individuals who are unable to physically relocate cross-border; use of global employment companies to quickly deploy high demand skills to where it is needed most.
Moving to a new talent approach and model requires deliberate thought and effort to ensure the change is embedded successfully and the gains sought are realised. As well as developing this new model through our work with clients, we have been able to develop a new set of building blocks (Figure 2, see next page) to support organisations with this journey.
Phase 1: WHY -
Seeks to understand what the business imperatives are and strategic goals as an organisation.
Phase 2: WHO -
Seeks to understand what skills are needed to allow the organisation to deliver its strategic objectives. Includes a clear assessment of the international talent requirements.
Phase 3: HOW AND WHERE -
Looks at how to meet international talent requirements through a mixture of buy, build, and/or borrow of talent. Fulfilment of needs is on a borderless basis through both virtual and onsite roles, and permanent and temporary arrangements.
Phase 4: WHAT -
By having clarity on the purpose of talent, what skills are needed, and how it will be deployed, organisations will then be able to think about the requirements for a ‘Global Workforce’ function which will manage both long-term attraction methods and support individual requests, delivering operational support.
Figure 1 - The New Global Workforce Model
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Figure 2 - Setting A New Global Workforce Approach
All phases are underpinned by analytics and longer-term workforce planning, driving retention efforts and ensuring return on talent investment.
The Implementation Turning Strategy Into Reality
Moving to a new model may not always be simple, but it is critical for organisations to consider how best to adapt to a global talent approach, particularly given the Future of Work is ‘here and now’. The first steps on this journey could include, but will not be limited to: Having a change-mindset: one of the most critical aspects of a successful implementation will be understanding and managing the change. The approach may require a differentiated mindset and culture - moving from domestic, potentially siloed functions to a multi-disciplinary global talent model. Engaging with your stakeholders: the implementation will require early buy-in from the top as well as collaboration across business functions. Educate yourself and your stakeholders on the need for change, and the benefits that can be reaped by taking this leap of faith as early as possible. Understanding the talent supply chain challenges: it is essential to understand your organisation’s problem statementboth in terms of size and scale. Knowing this will allow you to articulate the opportunities available and why a global talent approach may better enable wider business objectives.
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Considering the technology solutions available: a fundamental aspect will include having a supporting infrastructure to allow business leaders to access and understand the global skills and talent available. There are many talent marketplace and global workforce management technology solutions available, and conducting a market scan of these early in your change journey is imperative.
Time For Action
Having to respond to the increasingly complex world of talent is not a question of ‘if’ but ‘when’. Organisations must put in place a proactive strategy, approach, and model to respond and overcome the challenges faced. The time is now. If any of the topics and issues discussed here resonate, please do get in touch - we would be delighted to have a formal or informal conversation. Reference: (1) ‘Global jobs market recovery ‘has gone into reverse’, warns UN labour agency’, UN News – May 2022 (2) ‘Are employers heading for a talent shortage perfect storm?’, Forbes – May 2022 (3) 2022 Fortune/Deloitte CEO Survey (175 leading CEOs within 15 industries) – Winter 2022 (4) Future of Jobs Report 2020, World Economic Forum – Oct 2020 (5) ‘Creating a consumer-grade experience for employees with digital HR’, Deloitte - 2017 (6)2022 Fortune/Deloitte CEO Survey (175 leading CEOs within 15 industries) – Winter 2022
Having to respond to the increasingly complex world of talent is not a question of ‘if’ but ‘when’. Organisations must put in place a proactive strategy, approach, and model to respond and overcome the challenges faced. The time is now
INTERNATIONAL HR STRATEGY
RUMI DAS
Partner, Global Workforce Consulting, Deloitte LLP D: +44 20 7007 0433 E: rudas@deloitte.co.uk
BETH MCCONNELL
Director, Global Workforce Consulting, Deloitte LLP D: +44 20 7007 8643 E: bethmcconnell@deloitte.co.uk
JAMES HOBLEY
Associate Director, Global Workforce Consulting, Deloitte LLP D: +44 118 322 2509 E: jhobley@deloitte.co.uk
DELOITTE GLOBAL WORKFORCE CONSULTING
In today’s increasingly competitive world, businesses are having to find new ways to attract, acquire, develop, retain, and deploy key talent and skills. While traditional hiring practices and global mobility assignments are still in place new methodologies are emerging, and HR, Reward, and Global Mobility functions are at an inflection point where they need to consider how to respond to these exciting changes brought by the Future of Work. Deloitte’s Global Workforce Consulting practice partners with organisations to help optimise and transform the operational, strategic, and digital aspects of Global Workforce Management and pride ourselves on being able to tailor our support to client specific requirements. Find out more here www.deloitte.co.uk/globalworkforce
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Global Mobility In Times Of Disruption: 3 Ways To Minimise Global Mobility Programme Risk Global Mobility is at its inflection point. Midway through a second year with the pandemic as the backdrop and a war in Europe, GM functions, stakeholders and the ecosystem at large, continue to see the downstream impact that socio-economic and geo-policital disruptions have had and will continue to have on operational and strategic models of workforce mobilisation. Disruption brings about innovation; during the last two and a half years we’ve seen how companies have been equally empowered yet pragmatic about the future of Mobility in order to create intentional yet transformative Talent Mobility strategies enabling location-agnostic models of work.
Proactivity, Flexibility And Agility In Times Of Disruption
The benefits of having proactive and flexible mobility policies remains critical to ensure business continuity and resilience in times of crisis. As the employee purpose shifts to demand a truly borderless workforce, companies will need to be intentional in the design of the mobility, policies, programmes and experiences. We’d posit that with the cumulative downturn seeing national economies around the world at a deficit, and with rising unemployment rates there will continue to be a political shift towards nationalistic approaches in workforce recovery, with increasing focus on how immigration pathways support the upskilling and employability of local labour markets and increased government scrutiny on the hiring practices and the local-to-foreign national make-up of workforces. These ecosystem changes will have a significant impact on business investments and job creation efforts globallyAt the micro level, all stakeholders vested in global workforce strategies, can preempt these barriers with a targeted workforce analysis approach.
Compliance In A Complex World
Covid-19 has been a watershed moment for global mobility. Whilst Covid-19 related
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entry and travel bans have, for the most part, been lifted, the ways in which we cross international borders and work overseas has fundamentally changed - with new post-pandemic immigration, tax and social security rules to navigate. Indeed, a recent survey carried out by our Global Mobility team showed that 16% of respondents anticipated an increase to the geographical footprint of their organisations in allowing employees to work from wherever they like.
With the acceleration of remote work and other bespoke cross-border mobility patterns, tax authorities are revisiting legacy treaties, as they are no longer sustainable With the acceleration of remote work and other bespoke cross-border mobility patterns, tax authorities are revisiting legacy treaties, as they are no longer sustainable. The OECD initiative to examine further the taxation of mobile employees is likely to trigger more/ other regulatory changes in the mobility ecosystem. It is imperative for organisations to be compliance focused for these imminent
regulations. Companies will be ahead of the compliance curve by having a robust technical (taxation, immigration, payroll, social security) and operational infrastructure - one that is adopted enterprise-wide from the onset of workforce planning. Over the last two years of global disruption it has been clear that in times of heightened uncertainty and urgency the ideal governance model is one which, there is a greater sense of urgency to remove the internal and external silos, and accelerates an integrated risk management model.
Risk And Workforce Transformation
Over the past 26 months the question of risk and cost undoubtedly entered the conversation. The guidance remains to lead with the view that the cost of compliance is not solely a monetary value. Industry standards are advancing conversations around an organisation’s risk governance models and is at the core of how that risk is being assessed, managed and governed. Reputational and financial implications as well as the ability to source talent become exponentially more challenging if appropriate risk management is not part of a mobility strategy. The barriers to hire and mobilise quickly are historically fragmented and task based. Often underscored with reactive planning and lack of forecasting (particularly for out of scope assignment benefits, attrition, succession planning and regulatory costs). The possibilities exist to create your GM roadmap that considers all of these factors with the new segments of mobility. This strategic forecasting serves to help the business quantify and qualify the size of the programme, and address the risk dependencies by location and or mobility segmentation.
Recommendations
So what now? With the world continuing to be unpredictable, here are three recommendations for global mobility leads to help increase your programme’s resilience going forward: 1. After Action Reviews: Perform an audit of your programme and talent mobility by segments. What are the patterns that emerged? 2. Knowing your workforce and scenario mapping: Having reliable data on your
IMMIGRATION people (who they are, where they are and what they’re doing) is central to crisis management. Following the After Action Review, put to test your insights through scenario planning: This would include: a. Location analysis and common fact patterns can help set budgets and risk models increasing preparedness and reducing costs in times of disruption; and b. Identify the risk exposure relative to high-traffic locations and segments of your programme. 3. Collaborate with your internal stakeholders (including total rewards, procurement, immigration, policy and external mobility vendors): breaking silos and increasing genuine collaboration makes for strong mobility programmes that support innovative and agile workforce transformation.
How We Can Help
At Vialto Partners we believe that your business deserves boundless growth. Our teams can help you design and implement thoughtful mobility strategies that adapt in real time - from cross-border transfers to remote work and business travel.
Contact Us
Please reach out to your Vialto Partners contact to discuss the above and how we can help.
SHERYLL YOUNG
(Article author) Senior Manager, Global Mobility Strategy Consulting, Vialto LLP: Sheryll.s.young@vialto.com (Author) Further information on Vialto Partners can be found at: www.vialtopartners.com
RAJ MANN
Director and Global Advisory Lead, Vialto Partners, raj.x.mann@vialto.com Further information on Vialto Partners can be found at: www.vialtopartners.com
VIALTO PARTNERS
Vialto Partners ("Vialto") refers to wholly owned subsidiaries of CD&R Galaxy UK OpCo Limited as well as the other members of the Vialto Partners global network. The information contained in this document is for general guidance on matters of interest only. Vialto is not responsible for any errors or omissions, or for the results obtained from the use of this information. All information is provided "as is", with no guarantee of completeness, accuracy, timeliness or of the results obtained from the use of this information, and without warranty of any kind, express or implied, including, but not limited to warranties of performance, merchantability and fitness for a particular purpose. In no event will Vialto, its related entities, or the agents or employees thereof be liable to you or anyone else for any decision made or action taken in reliance on the information in this document or for any consequential, special or similar damages, even if advised of the possibility of such damages. © 2022 Vialto Partners. All rights reserved.
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TAXATION
The Language Of Payroll As the world starts to gradually re-open for business post-Covid, individuals and businesses are now commencing international assignments. When dealing with international assignees invariably a myriad of international payroll compliance issues also arises alongside the personal tax and social security issues, regardless of the size of businesses involved. There is no such thing as a typical international payroll and this could range from a relatively small business, which is employing an overseas resident for the first time, through to large multi-nationals who have acquired new employees through a recent acquisition, and the traditional expatriate scenario with companies who are seconding employees to work overseas on a short- or longer-term basis. In the last decade the range of countries we have been asked about has also changed significantly with expansion to all countries around the world. Additionally, we have had to deal with virtual assignments and working from anywhere because of the impact of Covid. It is not surprising therefore, that the language of payroll can vary dramatically from country to country, and it is useful to test the understanding of the terminology we use on a regular basis. More than one contact has confessed to us in the past that they didn’t understand the practical application of a particular word or phrase but that they had sat through so many conversations where it was taken for granted that they knew what the words meant that it was rather difficult now to put their hand up and ask the question. Hopefully this article can provide a useful crib sheet for some of the payroll terminology which we use on a regular basis and can easily take for granted. NATIONAL INSURANCE CONTRIBUTIONS (NICS) is simply the UK name for social security contributions. When corresponding with those in overseas locations we typically revert to using the term social security but for businesses with a UK liability it is helpful if they are familiar with the way in which NICs are paid and the different categories which apply to earnings. Primary Class 1 NIC is an employee contribution, Secondary Class 1 is an employer contribution and we also have Class 1A for employer contributions
on non-cash benefits, together with Class 1B which is collected when an employer meets an employee liability via a PAYE Settlement Agreement (PSA). Typically in the UK we will pay NICs at the same time as we pay employment taxes in one joint payment to HM Revenue & Customs (HMRC). Although practices vary from country to country, some locations such as Spain will not only pay the taxes and social security in separate payments but also at different intervals with the former being paid on a quarterly basis whilst the latter is paid monthly.
Typically in the UK we will pay NICs at the same time as we pay employment taxes in one joint payment to HM Revenue & Customs (HMRC) SOCIAL SECURITY conversely is the name most countries use when talking about what we more commonly and usually refer to national insurance (NICs). Typically with social security or NIC’s when advising employers and assignees most focus and advice is on the contributions payable and not on potential benefits from any social security system as a result of the payment of such contributions. The challenge in seeking to advise on social security benefits, notably pensions, is that generally the rules (will) change significantly over time and the life of the assignee, and you are also touching on investment decisions and personal planning for which most are not authorised or qualified. TAXES you may think are more straightforward, although, whilst in the UK we think of social security payments/
NIC’s as a liability which is separate and distinct from tax, in some countries they will refer to social taxes. It is important to clarify whether the country in question has a personal tax withholding obligation for employees, rather than taxes being collected direct from the employee on a personal reporting basis. Within the UK in April 2017, the APPRENTICESHIP LEVY was introduced, which could cost employers 0.5% of the annual pay bill. The HEALTH & SOCIAL CARE LEVY will come into effect from April 2023, with immediate increases in National Insurance in the interim. Given Covid induced government budget deficits around the world, further new charges or levies could yet be introduced whether in the UK or elsewhere. Always check with your adviser for the latest developments. Another issue which should be clarified at an early stage when setting up a payroll in a new country is the question of who will be responsible for paying over the taxes and can they be paid from an overseas bank account. Whilst HMRC will accept overseas payments they do provide an alternative account number to which payments should be directed, but many countries such as Turkey, will insist on payments being made from a local bank account. In the UK you will find that an additional charge will arise if a payroll business is able to offer payment solutions such as: BACS – Bankers Automated Clearing Services for making payments direct from one UK bank account to another. CHAPS – Clearing House Automated Payment which is a UK system for same day payments. Other countries might recognise this as an RTGS – Real Time Gross Settlement system, another example of which would be Canada’s LVTS – Large Value Transfer system. We think we are all familiar with the terms GROSS and NET pay, but it is easy to become confused when people start talking about GROSS TO NET or NET TO GROSS. The majority of employees are paid based on a gross salary. That is the amount they will receive before the deduction of taxes and social security contributions. A job role is therefore generally advertised based on a gross salary, but the net that the employee will receive will reflect their personal circumstances and the tax and social security/NIC rates applying. Typically we carry out a GROSS TO NET forecast based on a standard amount of tax free allowances to help an international
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employer understand what the likely net figure will be that is delivered to an employee. Often though, in an international payroll scenario, an employer will have a pre-defined net salary that they want to deliver to an employee and then a calculation to give the estimated gross salary will be necessary to achieve the desired result - a NET TO GROSS calculation. This is frequently the case for tax equalised individuals. The most frequent misconception we come across from an employer who is taking on an overseas employee for the first time, be it a secondment or a local hire is “It’s ok we are going to pay them through the UK payroll so don’t need to worry about local tax withholding”. Whilst occasionally a country will operate on a self-assessment basis for the employee, particularly if the company has no other presence in the country, it is rare that matters are that simple! Whilst it perfectly acceptable to pay an employee through the UK payroll whilst they are working abroad, it is by no means certain that this will be the end of your obligations as many countries will require you to register locally as an employer, operate a ‘local payroll’ and withhold taxes and/or social security contributions in that country. Equally, an employer can continue to pay an employee on a non-UK payroll throughout the duration of the employee’s period working in the UK, but this does not mean that UK Pay As You Earn (PAYE – i.e. UK wage withholding) does not also need to be deducted. This brings us to the confusing world of SHADOW, GHOST, MIRROR and SPLIT payrolls. A SHADOW payroll is a key component in maintaining compliance for an expatriate employee. Typically an employee may be paid from their home country payroll but will need a shadow payroll to be run in the host country to ensure payroll compliance obligations are met. In addition to SHADOW payrolls you may also come across references to either a GHOST or MIRROR payroll. In essence though, these terms are all used to denote that it is a secondary payroll, run in the background, it is not the payroll which delivers the actual net salary to the employee. Instead, this secondary payroll may reflect the salary paid in the home country, but with deductions for tax and social security based on host country regulations. Alternatively, these terms may also be used where the employee is paid via the host country payroll but a secondary payroll is required in the home country, perhaps to ensure continued contributions in the home country social security scheme or to maintain participation in a company pension scheme.
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To complicate matters you may find that these terms are used differently around the globe, and whilst in some countries they are interchangeable, in others they will define which type of secondary payroll is being run. So, for instance, looking at Sweden, a Ghost payroll may be maintained for local compliance and reporting purposes, whilst a home country Shadow payroll would be utilised for an employee who was being paid via the host country payroll but needed to remain in the home country social security system. Not to be confused of course with the phrase GHOST Employee which has a different meaning altogether, and typically relates to a situation where a fraud is being committed through the use of fictitious employees.
A SPLIT payroll arrangement is similarly used to maintain compliance in home and host countries for an expatriate employee but in this scenario, both of the payrolls will be used to deliver part of the net salary to the employee A SPLIT payroll arrangement is similarly used to maintain compliance in home and host countries for an expatriate employee, but in this scenario, both of the payrolls will be used to deliver part of the net salary to the employee.
As well as the issues covered above in relation to other secondary payroll arrangements, a split payroll solution may be preferred because an employee needs to maintain accommodation in both locations, perhaps because a posting is unaccompanied and therefore the employee needs to receive funds in both locations to assist with meeting their liabilities, or it can be utilised to help with fluctuations due to currency exchange rates. Another term widely used is the phrase BENEFITS IN KIND which in the UK refers primarily to the non-cash elements of a remuneration package, the most popular being private medical insurance and company cars. Other countries might refer to these items as FRINGE BENEFITS or PERKS. Australia and New Zealand for instance, have FBT or Fringe Benefits Tax which is paid on certain benefits provided by employers. In the UK in particular it is important to identify which items are effectively a cash reward, perhaps the reimbursement of an expense item which does not meet the qualifying standards for exemption as a wholly business expense. Such payments will be considered to be part of salary and should therefore be subject to tax and social security/NIC via the payroll. Whereas a non-cash item such as medical insurance which is provided under a company’s group insurance scheme is generally reported post tax year end and whilst the employee is taxed on the value of the benefit, under current rules only the employer will pay social security contributions on the value of a non-cash benefit, there are no employee social security contributions. We should add that it is possible for employers to opt to payroll such non-cash benefits on a voluntary basis and we have a phrase PAYROLLING BENEFITS IN KIND to denote this arrangement. In the UK we also have the concept of a SHORT-TERM BUSINESS VISITOR, and whilst again the terminology might vary from country to country, many jurisdictions now have separate rules which apply to BUSINESS VISITORS or BUSINESS TRAVELLERS. Rather than an employee who is seconded to work abroad, the business visitor we have in mind will be an employee of an international company who makes short trips to countries on business and most likely will visit several countries a year, if not several a month. Whilst the visits may only be of a day or two in length, in some countries such as the UK or Canada, this will be sufficient to trigger withholding obligations and or reporting obligations. The obligations for business visitors may vary depending on the type of group entity
TAXATION which is present in the country visited, for instance whether this is a subsidiary company or, a branch office of the company which employs the individual in question. The purpose of the visit may also be important to determine the status of the visit for tax purposes. The taxation of business visitors is under increasing scrutiny by HMRC in the UK and international organisations which have a UK presence ignore the obligations at their peril. We cannot finish a discussion on the language of international payroll without giving some consideration to some phrases which you might come across that although not directly related to the payroll tax withholding process, none the less represent key issues which may arise in conjunction with an international employment situation but are all too often overlooked when planning assignments and business trips. T h e co n ce p t o f P E R M A N E N T ESTABLISHMENT and consideration of TRANSFER PRICING are both Corporate Tax matters which fall outside the scope of payroll, but they are both complex areas which may be directly impacted by an international secondment or enhanced business presence due in the local jurisdiction.
Transfer Pricing looks at the pricing of transactions between two companies within the same business group and therefore the recharging of employment costs will fall within the scope of this. Suffice to say that the rules for Permanent Establishments are under closer scrutiny due to BEPS rules introduced a few years ago which set out to tackle the artificial avoidance of Permanent Establishment Status, so we will leave you with one final definition as follows: BEPS – Base Erosion and Profit Shifting. These rules changed a few years ago and increased alignment of costs and value creation. As mentioned, the rules will make it harder for businesses to avoid the creation of a permanent establishment, but also much harder for individuals to avoid tax in an overseas jurisdiction as more business will have to recharge costs, which in turn will reduce the tax treaty exemptions available.
Summary
It is sometimes too easy to assume that all understand the payroll terminology used or indeed that the same terminology is used across the world. If you are not sure of the words being used by your tax or payroll adviser then do ask. A clear understanding at the outset is better for all.
ANDREW BAILEY
Andrew Bailey is head of Global Employer Services at BDO LLP. He has over 30 years’ experience in the field of expatriate taxation. Andrew is indebted to Karen Foster for her major contribution to this article. BDO can 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 or Karen Foster on +44 (0) 1473 320747, Karen.Foster@bdo.co.uk
The 2022 Global HR Conference Monday 17th October 2022 at The Adelphi Building, 1-11 John Adam Street, London, from 12.30pm – 4.45pm For Senior Global HR Professionals only, this one day event will cover issues and topics specifically aimed at those managing their company or organisation’s global mobility.
Seminars Include: Aligning GM Policies With Wider Business Objectives Concerning Sustainability And Inclusivity Agendas ECA International will discuss how GM teams can adapt and modify mobility policies to: • broaden the succession talent pool • build more sustainable work practices for internationally mobile employees Tax & Mobility Update Update from BDO regarding tax changes and topical mobility issues & trends Immigration Update Vialto Partners' global advisory team will discuss the latest global immigration updates, trends and predictions pertinent to Senior Global HR Professionals and Global Mobility teams. Buying Mobility Software – are you Horizontal or Vertical? Replacing outdated vertical vendor and systems relationships with a horizontally integrated platform will save you time, improve the UX for your employees and improve data security for your company. Building on our latest article in the International HR Advisor, Tracker Software Technologies (TST) will explain how to achieve efficiencies and break down this topic into a manageable project and one that can be implemented in all organisations. Hosted by TST International. To register your free place at this event that is organised by International HR Adviser, please email helen@internationalhradviser.com with the name/s of those who would like to attend, along with your/their job title and company name.
We look forward to seeing you there!
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Global Tax Update CANADA
Stock Appreciation Rights: Be Considerate of Dividends Many companies offer long-term incentive schemes in the form of equity compensation to various employees or consultants with a goal of retaining talent and allowing participants of these Plans to share in the growth of the company. These equity compensation plans may include Restricted Share Units, Restricted Share Awards, Stock Option Plans, or sometimes Share Appreciation Rights. While these compensation items may attract participants, it is important to ensure that both the company and participants are aware of the nuances related to the taxation of these items, especially since taxation is closely dependent on the terms and conditions of each Plan. No one single Plan is identical to another, and a change of one single clause in the Plan has the power to significantly alter the resulting tax implications. Stock Appreciation Rights (“SARs”) are not explicitly defined in Canada’s Income Tax Act, but they are commonly known as phantom plans that entitle the participant to receive an amount equal to the appreciation in the value of the underlying shares from the date that the SAR is granted until the date that it is exercised. Typically, where certain conditions are met, SARs are considered to have no value at grant, and its value is considered dependent on future services to be rendered. Therefore, where certain conditions are met, taxation of SARs typically arise at the time of vest, when the participant has fulfilled the required vesting conditions and are eligible for payout of the appreciation in value. However, where the Plan entitles a participant to a dividend-equivalent prior to time of vest, where the value and timing of this dividend-equivalent is dependent on the actual dividend payments made to shareholders of the underlying shares, taxation of the Plan may be accelerated to the time that the participant becomes entitled to receive the first such dividend-equivalent. This acceleration in timing of taxation is a result of the Salary Deferral Rules in Canada, where deferred amounts are taxed currently as earned and not upon receipt at vest. Once these Salary Deferral Rules have been triggered, any appreciation under the Plan must be reported as income on an annual basis, instead of reported once in aggregate at time of vest. Still, this does not imply that dividendequivalents are not recommended and should never appear in Plans. Situations may arise where a dividend-equivalent is present in the Plan but does not cause acceleration
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of the timing of taxation. The terms and conditions of the Plan is key, and care must be taken to ensure that the wording of the Plan allows for favourable taxation. BDO Comment As the terms and conditions of each Plan vary, it remains pertinent that a Plan is reviewed prior to the initial issuance so that the Plan may be modified, as necessary, to ensure favourable taxation where possible. Where issuances have already been granted under the Plan, the review may still offer insight into any taxation concerns and offer recommendations for future issuances. Where a company wishes to have absolute guarantee on the taxation of a Plan, an official Advance Tax Ruling would need to be requested with the Income Tax Rulings Directorate at the Canada Revenue Agency. These official rulings may take 90 days or longer to process, and therefore would need to be initiated early if the company hopes to obtain an official ruling prior to the first issuance under the Plan.
Where a company wishes to have absolute guarantee on the taxation of a Plan, an official Advance Tax Ruling would need to be requested with the Income Tax Rulings Directorate at the Canada Revenue Agency
HONG KONG
Legal limits for unpaid wages on bankruptcy and Covid-19 The large surge in Covid cases in Hong Kong in recent months is certain to have a detrimental effect on those businesses in sectors that have been hardest hit by the pandemic, such as restaurants and bars, hotels, travel, entertainment, health and fitness. The leading companies in these sectors have predicted that the business losses could exceed HK$11 billion. The worst-case scenario would involve a surge of closures which would inevitably increase the unemployment rate and the number of claims for unpaid wages made to the Protection of Wages on Insolvency Fund (PWIF) by workers whose employers have gone bankrupt. Since early 2020, Hong Kong, like many other locations, has been dealing with a challenging economic downturn resulting from the COVID-19 pandemic and some businesses may not be able to pay their employees before they become insolvent or go bankrupt. When an employer has failed to pay employees’ entitlements due to insolvency or bankruptcy, the employees may present a winding-up or bankruptcy petition to recover debts owed by an insolvent employer under the provisions of Protection of Wages on Insolvency Ordinance. At the same time, the employees may also apply for an ex-gratia payment (including unpaid wages, pay for outstanding annual leave and statutory leave, wages in lieu of notice, and severance payments) from the PWIF. The PWIF is financed by an annual charge of HK$250 on each business registration certificate issued. Under the provisions of The Companies (Winding Up and Miscellaneous Provisions) Ordinance (CWUMPO), when a company is wound up, certain debts relating to employee entitlements must be paid out of the company’s assets before settling any debts owed to other unsecured creditors. The CWUMPO also gives priority to employees over other creditors in respect of payments made from the PWIF. According to the Protection of Wages on Insolvency Ordinance, the ex- gratia payment that may be made from the PWIF covers the following (on the following page): In general, a claim for payment from the PWIF must be made within six months of the last day of employment. The headline statistics on the PWIF published by the Labour Department revealed the latest position of the fund.
GLOBAL TAXATION
The table below, outlines the number of claims for exgratia payments processed and approved, and the accumulated surplus of the PWIF from January 2017 to June 2021: According to the statistics, there was a significant increase in the number of claims for ex-gratia payments in the first six months of 2021. The number of claims approved and the total amount paid to claimants increased by more than one-third compared with the same period in 2020. The ongoing COVID-19 pandemic has had a catastrophic effect on businesses throughout the region, but some sectors have been harder hit than others, and some business leaders have warned that more companies will face insolvency or bankruptcy and have to close.
This would lead to more people losing their jobs, and more claims for ex-gratia payments. However, the current limits that apply to claims are based on average earnings that have not been updated for decades. For example, the current ceiling of HK$36,000 is equivalent to four months on an average monthly salary of HK$8,000, which has not been updated since 1996. With the prospect of more companies closing, some have argued that the government urgently needs to consider amending the Protection of Wages on Insolvency Ordinance by increasing the caps on the four ex-gratia payment items that can be claimed from the PWIF. This would ensure that employees whose earnings exceed the current limit are protected.
On several occasions over the past two decades, representatives from the labour unions, accounting professions, the Legislative Council and various other stakeholders, have voiced their concerns to the government about the cap on wages in arrears, arguing that it should be increased to align it with the latest median monthly pay. In July 2021, the labour unions reiterated that a review of the current ceiling on wages in arrears was imminent in view of the current unemployment situation. The statistics for 2020 show that the average claim for wages in arrears that year was HK$41,482. Because the cap is set at HK$36,000, this means that claimants were facing an average loss of HK$5,482. The labour unions therefore urged
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the government to increase the upper limit to HK$76,000 (equivalent to four times the adjusted monthly median pay of HK$19,000 for the fourth quarter of 2019) as soon as possible, so that people are able to receive fair compensation for what they are owed by their former employers. In December 2021, the Commissioner of Labour responded to questions from the media about the above request by confirming that the Board of the PWIF was investigating increasing the upper limits for ex-gratia payment items and considering appropriate adjustments for each item. The government’s proposal to abolish the offsetting of severance payments and long service payments with employers’ mandatory contributions under the Mandatory Provident Fund (MPF) system (the ‘abolition arrangements’) would have a significant impact on the ex-gratia payments for severance pay that the PWIF would have to make – and, in turn, on the fund’s financial position. Therefore, the Board of the PWIF is reviewing the details of the abolition arrangements that have almost been concluded and will present their review and proposals to the Labour Advisory Board. The Board is expected to report on its proposed amendments to the Protection of Wages on Insolvency Ordinance to the Legislative Council Panel on Manpower during the first half of 2022, and will also introduce the proposed amendments to the Legislative Council in 2022. BDO Comment In addition to the above, we are aware that many employers in Hong Kong are small or medium sized enterprises that might be unable to afford a substantial rise in the annual business registration certificate fee (currently, HK$250 per certificate) to cover the proposed significant increase to the upper limits attached to the ex-gratia payment items covered by the PWIF, especially during the current economic downturn. In general, therefore, the business sector is unlikely to support the proposals mentioned in this article. In view of the complexity of this topic and the controversy surrounding it, in addition to the potential impacts on Hong Kong’s entrepreneurs, labour market, economy and wider community, it will be difficult for the employment and business sectors to reach a consensus on the proposed amendments and pass them to the Legislative Council for approval in 2022. However, we will continue to keep you informed as this matter develops.
INDIA
Tribunal case found for no fixed place permant establishment in India in relation to Japanese multinational with employees working in India A Delhi tribunal decision earlier this year has found in favour of the taxpayer deciding no
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fixed place permanent establishment (PE) of the employer existed in India. This case was essentially relating to engineers from a Japanese multinational corporation visiting the premises of an Indian affiliate to provide technical support in the factory of the Indian affiliate. The tribunal held that merely providing access to the Indian facility would not amount to the place being at the disposal of the taxpayer. Though the taxpayer had access to the Indian factory premises, it was for the limited purposes of rendering agreed services without any rights to use or control over the premises.
Though the taxpayer had access to the Indian factory premises, it was for the limited purposes of rendering agreed services without any rights to use or control over the premises The tribunal also held that the Japanese company was not conducting a business in India. The tax authorities had sought to argue that the title to parts manufactured by the Japanese company and sold to the Indian affiliate transferred in India and therefore there was a PE. The tribunal disagreed with this. Finally, there was examination of whether the Japanese company was carrying on a supervisory activity in connecting with an installation project in India for more than six months which under the terms of the Japan/ India treaty would also have created a PE. BDO Comment This case is a good example of the issues that business travellers can cause multinationals even where no PE is expected. It is a
cautionary story of how such activities need to be carefully monitored to be sure no PE is created and to be sure sufficient documentation is maintained to defend this in the event of challenge.
PORTUGAL
Non-habitual resident in Portugal Under the Portuguese Personal Income Tax law, an individual is considered to be Portuguese tax resident if he meets at least one of the following requirements: • The individual remains in Portugal more than 183 days in any period of 12 months • The individual’s stay for a shorter period but in any day of that shorter period the individual has in Portugal a main abode and uses that main abode as if it is his principal house. Partial Tax Residency: Under the Portuguese tax law, an individual can be partial tax resident since 1 January 2015. The fact that the spouse is not in Portugal will not hinder the Portuguese tax residency provided that the other residency links are fulfilled. The taxpayer tax resident in Portugal is considered as “separated” (not divorced). Once you become Portuguese tax resident, you can be taxed under two different systems: Ordinary tax regime: • Applicable when you do not qualify for the special tax regime • Taxation on a world-wide basis • Progressive tax rates (from 14.5% to 48%) plus surcharge tax (from 2.5% to 5%) if taxable basis exceeds €80,000 and up to €250,000 or over €250,000 • Most overseas sourced income is taxed and disclosed herein although an internal tax credit relief is available. Non-habitual tax regime: • Applicable when you meet the specific local residency requirements plus proof of tax residency overseas in the last 5 (five) years prior to application • Taxation on a world-wide basis • Flat 20% tax rate on employment or selfemployment income deriving from high added value activities plus surcharge tax (if applicable) • Exemption on wide extension of passive income sourced overseas if income is potentially taxed on source due to specific DTA provision. Two Different Ways To Be Taxed In Portugal • Interests, dividends, pensions (*) and royalties if sourced overseas may be exempt in Portugal if certain DTA (**) provisions apply (may be tax clause on the DTA with the source Country is enough) • Local benefits are available to income NOT deriving from countries listed as TAX HAVENS (Black List).
GLOBAL TAXATION Revenues from some jurisdictions which are black listed will still get the exemption when they also have a DTA with Portugal (example: UAE or Hong Kong – cfr. recent developments). AND • In Portugal there is no wealth tax and Gifts and Inheritances are not taxed if made between next of kin (spouses and children) • Employment or self-employment income of high added value activities is taxable on a worldwide basis at a flat tax rate of: a. 20% flat tax with no cap b. Employment income taxed overseas is exempt in Portugal. High added value activities: • Engineers; Biologists; ITs experts and programmers; artists and performers, qualified professionals who work in industry, agriculture experts. The list is somewhat wide for technical professions not obliging superior levels • No need to get a clearance from the local tax authorities, however, we advise that a defensive file is prepared in case of challenge by Tax Authorities. Update Approach On Taxation Of PENSIONS On 31 March 2020, the State General Budget for 2020 amended the RNH regime by revoking the local exemption for foreign pensions income and imposed a flat 10% tax rate.
The previous NHR regime made pensions of foreign sources exempt from IRS The previous NHR regime made pensions of foreign sources exempt from IRS. Nonetheless Grandfathering rules were also approved. The old regime could still be applied to individuals : • On the date of entry into force of this law, were already registered as NHR • On the date of entry into force of this law, had already made their applications for the status of the NHR • On 31 March 2020, were already tax residents in Portugal and apply for registration as NHR until 31 March 2021.
Taxpayers who become tax residents in Portugal after 1 April 2020, will be obligatorily subject to the new rules, being compulsorily covered by the new NHR regime - that is, 10% effective local personal income tax rate on foreign pensions.
ANDREW BAILEY
Prepared by BDO LLP. For further information please contact Andrew Bailey on 0207 893 2946 or at andrew.bailey@bdo.co.uk
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Collect Key Data Points For Success At its core, employee relocation is a human resource benefit and like all HR benefits, from health insurance to retirement accounts, organisations need timely and insightful feedback from employees.
Fast Facts
67% of CHROs are prioritising organising around the employee experience; focusing on the employee moments that matter most and deploying resources accordingly. Furthermore, around 95% of CHROs are prioritising elevating their HR through digitalisation, as explained below, according to research from McKinsey & Company.
Prioritise The Employee Experience
When prioritising around the employee relocation experience, the moments that matter most are typically driven by money, time, and emotion. Organisations need to separate their experience from that of the individual employee. Even if a relocation is on time, within estimated costs, and has zero policy exceptions, the positive sentiment may not be shared by the employee.
What data should my organisation be collecting to minimise these issues and maximise the employee experience?
Your Relocation Management Company (RMC) has the opportunity and obligation to collect and act upon data from your employees. The following are sample questions your RMC should ask:
Household Goods Shipment
• Are your pack, load, and delivery dates correct? • Was the crew courteous, timely, and professional? • How satisfied were you with the claims process, timeline, and final settlement? • Overall, were you satisfied with your household goods shipment?
Destination Services
• Overall, were you satisfied with your temporary housing? • Overall, were you satisfied with your destination services? • Was the temporary housing check-in process simple? • Is your temporary housing unit clean and comfortable? • Does your temporary housing contain all amenities and features as advertised?
RMC Service
• Was your relocation counsellor responsive to your needs? • Was your relocation counsellor knowledgeable about the entire relocation process? • Was your relocation counsellor courteous and helpful? • On a scale of 1-10, how likely are you to recommend the RMC to a friend or colleague?
Overall Satisfaction
• Overall, were you satisfied with your expense management? • Do you plan on staying with the organisation for the foreseeable future? Why or why not? • Which relocation benefits were most valuable in your opinion? • If given the opportunity, would you relocate again? • What else should we know about your experience?
How And When Should My RMC Collect This Data? Traditional Surveys
Traditional surveys yield the lowest response rates, and they are typically completed after a relocation (and its issues) have already occurred. Regardless, your RMC should send free, customised surveys to your employees.
Real-Time or "Pulse" Surveys
Real-time or "pulse" surveys, as the name suggests, are rapid 1-2 question surveys that allow your relocation management partner to diagnose the situation and proactively address any issues. These yield the highest response rates and pulse surveys are a tremendous opportunity to collect feedback on employee moments that matter most: during pack and load, temporary housing check-in, and more.
Post-Relocation Survey
The top RMCs in the world measure return on investment by sitting down with your employees 6-12 months after relocating.
Focus on employee moments that matter most and deploy your resources accordingly.
Your organisation and RMC should follow up with employees 6-12 months after employees are settled into their new
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COLLECT KEY DATA POINTS FOR SUCCESS Top RMCs elevate you and your organisation by requesting live feedback, sharing critical survey data, and following up 6-12 months later to understand the true organisational return on investment.
locations. It is widely understood that many relocations fail 6-12 months after a family has settled in, so why isn't your RMC deploying resources accordingly? 95% of CHROs are prioritising elevating HR through digitalisation by thinking of solutions, data, and the employee experience. Through this digitalisation, your organisation's key stakeholders can begin to understand the data your RMC is collecting, and then step in during those critical moments or adjust your organisation's relocation policies.
Focus on employee moments that matter most and deploy your resources accordingly. Your organisation and RMC should follow up with employees 6-12 months after employees are settled into their new locations How Should Your Organisation Handle Survey Reporting?
• Incorporate your employee's feedback into your next relocation policy benchmark. If an assignment failed due to cultural or language barriers, deploy your resources accordingly. If your organisation doesn't track ROI, ask your RMC to start. • You should receive customised reporting for free. Don't just listen to the conversations, be a part of them. Review questions (how they are asked and when) and suggest new ones. • Your organisation deserves to receive clear and unfiltered employee survey reporting each month, including pulse surveys, traditional surveys, and 6-12 months post-relocation.
CHRIS LAGERMAN
Chris Lagerman, CRP, GMS, is the Director of Global Operations at WHR Global (WHR). With over 20 years of experience, Lagerman has a diverse background in the various facets of global mobility and employee relocation. He is responsible for the management of WHR’s overall service delivery, streamlining operations, documenting processes, internal team development, and the continuous improvement of all WHR’s quality and service operations. He can be reached at main: 262-523-2800; direct: 262-523-7508; email: chris.lagerman@whrg.com WHR Global Since 1994, WHR Global (WHR) – a privately owned global relocation management company – has partnered with human resources, travel divisions, and relocation departments at a wide variety of organizations from Fortune 100 corporations to the U.S. Government. Solely and independently owned since its inception, WHR specializes in providing each transferring employee or assignee with a dedicated relocation team, whiteglove service, and 24/7/365 availability for the entire relocation process – including long or short-term assignments. WHR helps some of the largest organizations in the world and has relocated hundreds of thousands of employees to over 100 countries worldwide. With a 100% client retention rate for the past decade and consistent client/ employee satisfaction scores of 98% or better, WHR is a proven leader in the employee relocation industry. Its global headquarters is in Milwaukee, Wisconsin (serving North America/Latin America); international offices are in Basel, Switzerland (serving Europe, the Middle East, and Africa); and Singapore (serving the Asia Pacific). WHR lives by its passion for Advancing Lives Forward® and Making the Complex Simple.
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Buying Mobility Software Are You Horizontal Or Vertical? Procuring Mobility Software has been an ever-present issue for mobility teams managing business travellers – and now remote teams - for many years. With scarce budgets, many teams rely heavily on manual processes and spreadsheets to manage the multiple processes that impinge on the efficient daily management of mobile employees – especially business travellers and remote workers. Where this gets complicated is when there are multiple stakeholders involved in the management of mobile employees. In a post-covid world we are seeing much larger stakeholder teams become involved in the procurement of technology to support these employees and the processes they require. While Global Mobility will often lead in a multi-stakeholder task force there are many different requirements from different stakeholders – and desires to connect to their individual downstream providers. Different stakeholders have been used to varying levels of system support – with some more sophisticated than others. A typical taskforce or project team could have some or all of the following stakeholders – all working together to resolve a business problem – caused by one mobile employee or remote worker. To support their clients and to move them away from spreadsheets, many downstream providers have invested in their technologies and developed sophisticated portals to enhance the user experience.
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HR users are not always to the forefront of IT resource allocation and in many companies nowadays the connection and sharing of employee data is a well-protected and infrequently approved function
This investment in supplier technology was usually carried out in a ‘Vertical’ manner – those providers were addressing the needs of their particular vertical and supporting the needs of their customer within the company – not necessarily the needs of the related stakeholders. Often the sales process involved a discussion on ‘integration’ – mainly with HR IS systems. In many cases these projects didn’t complete this element of the procurement, as teams competed with other internal stakeholders for scarce IT resource to carry out the full integration, or the planning phase didn’t take into account the costs, scale or capabilities of either party to complete the integration. HR users are not always to the forefront of IT resource allocation, and in many companies nowadays the connection and sharing of employee data is a well-protected and infrequently approved function. As a result, many vertical suppliers resort to CSV upload or self-service by the employee. This leads to user frustration and often incomplete and dysfunctional service provision as employees have to log onto multiple systems – often entering similar data several times. In the era of InfoSec, this method of having loose files zooming around the internet with sensitive data is a significant problem for a Chief Data Officer or Information Security Officer. The model looked a little like this… each ‘Vertical’ satisfying the needs of their individual stakeholder – albeit in a quasimanual fashion. Other stakeholders outside of the mobility teams have been drawn into the management of business travellers as compliance obligations grew – but there was
BUYING MOBILITY SOFTWARE Vertical Model
Multiple Stakeholders
Corporate
CSV
Vendor Base
Tax Provider
no single aligned view of all of the different vertical stakeholder technologies. Each vertical had different levels of sophistication – usually related to the financial strength of those deparments. The last two years of Covid impact has, however, shifted the needle, and has accelerated the need to move from manual or vertical systems to a single unifying technology that can satisfy the multiple stake holders now involved in the process. This digital convergence is the ultimate goal of many CIOs. Cross-company suppliers of HR IS systems have not developed significantly to deliver this overarching technology so a gap has opened for additional technological layers. It is this multi-stakeholder element that has changed the focus most. Covid impacts have brought new C Level focus on where mobile employees are – and what risks they and the company face while being mobile for the company. Covid has also forced travel managers and mobility managers to work more closely together to ensure there is no duplication of
Immigration Provider
Travel Provider
effort and systems are optimised – but there are many stake holders – Tax, Immigration, Payroll, Safety and Cyber are increasingly involved in monitoring mobile employees – each working together on a single mission to manage the different functional/corporate responsibilities/compliance triggered by one business travel or remote work event. Each of these ‘Vertical Providers (Verticals)’ usually have a distinct service offering, and in many cases they only do Tax or Immigration or Payroll – and seldom multiple services from a single business unit. Where this becomes an issue is that many of these systems have been developed within the vendors with only that one Vertical in mind. End users want to log onto one system where they can see the multiple vendors data in one place – either on Portal or App. Single Sign On processes have become easier to implement in recent years, but this is usually not sufficient to deliver the rich profile data needed to support services such as
HR Systems
Safety Provider
robotic form completion and automatic filing with regulatory authorities. The end result is a mish mash of manual and fillable pdf forms that lead to a poor employee experience, inefficiencies and resultant errors.
Horizontal Meets The Vertical
There is a burgeoning move towards ‘Horizontal’ technologies who act as a buffer between the HR IS systems and the multiple vertical stakeholders that need to work with the employee data. In this way the Corporate connects the HR IS systems once to the Horizontal service provider who in turn connects to each of the Vertical suppliers – such as Tax, Immigration or Duty of Care providers. In the ‘Horizontal’ model the Corporate has usually only one HRIS system connection to create and manage and one framework contractor that deals with the onward transmission of the data and case management to the specific vertical suppliers. In this way the Immigration and Tax vendors receive a higher level of data to support their
Horizontal Model
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individual service provision but don’t have to have a separate HR IS connection and all of the associated management issues.
Multiple Personas Of A Mobile Employee
With the rise of remote work as a phenomenon we can now see how a single employee can have multiple personas in any given year. I might have some regular business travel, be selected for a special project in another country lasting a couple of months and I could then add in 30 days in a remote work location according to company policy – I might even be a Frontier Worker or regular cross-border commuter. These personas crash together at different times in the year and the impacts of one can possibly have a significant impact on compliance obligations later in the year. To effectively manage mobile employees in this new way of working we need to view their travel holistically. Managing the impacts of just such an employee will show up the weaknesses of vertical management of the issues and require the multi stakeholder approach mentioned above. Individual project teams that are working on the ‘remote work’ problem soon realise they need to manage the overall impacts of all travel/remote work so they can be better equipped to manage the downstream compliance demands. A simple example is a UK employee with regular business travel to the EEA, and availing of 30 days in a remote work location in Spain during the summer, could easily have issues with work permits or entry to the Schengen area later in the year. Throw in the potential Permanent Establishment and Duty of Care issues and you will see how a multi stakeholder and single technology approach will be beneficial. So, here I have to declare an interest in writing this article – my company provides just such a technology that allows for
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multiple API connections so that the varied services needed to support a business traveller or remote worker – such as A1, Visa, Work Permit, Cyber Briefing or Duty of Care location can be accomplished in one user experience.
All of the ‘Vertical’ vendors managing their piece of the service provision receive the transactions from the single unifying technology
as part of a single interface for the user/ traveller/assignee • A one world view for that traveller and their HR partners to see individual cases sent to multiple providers • Alerts are sent when thresholds for compliance are met • All documentation is kept in one secure location and travellers can easily access their A1, Posted Worker or Work Permit documents in one place – not logging on to individual service provider systems to locate documents. The procurement of business travel, assignment management and remote worker technology is already a multi-stakeholder project – it follows that as part of that procurement those forward-looking teams will expect to see a one world view of the multiple ‘Vertical’ providers in a single ‘Horizontal’ platform. As well as the Tracker Software platform, Big 4 Providers and companies like Equus, Vialto, Benivo and Topia are well positioned to become these horizontal players - there is a decision point now for Verticals in the Tax, Immigration, Payroll, Duty of Care players to work with the emerging service model and grow their ability to serve their corporate clients in this new ‘Horizontal’ world. So would you buy Horizontal or Vertical?
LIAM BRENNAN All of the ‘Vertical’ vendors managing their piece of the service provision receive the transactions from the single unifying technology. The transactions remain the same – it’s just the means of receiving the transaction that may change – instead of coming from a user on the front door portal of the ‘Vertical’ the transaction comes via API from the ‘Horizontal’ provider. The benefits to the corporate are immense • One unifying technology delivering the (same) data to multiple service providers
Liam Brennan is the CEO and Founder of Tracker Software Technologies. He has spent the last 30 years working with global multi nationals in the areas of Supply Chain, Travel, Relocation and Technology. The Tracker Software platform is the only platform solely dedicated to the management of business traveller and remote work compliance. Many of the industry business travel tools are built on the Tracker platform and daily over 1 million employees have access to the Tracker tool. Contact Liam on: Liam.Brennan@gtglobaltracker.com
GLOBAL MOBILITY
Global Mobility: Leadership Requires Presence Report Methodology
The following are very early findings of a report sponsored by Santa Fe Relocation. The research involves interviews with senior staff with experience of significant relocation of staff. The project is being led by Dr Phil Renshaw (Visiting Fellow, Cranfield University) and Dr Jenny Robinson (Visiting Fellow, Henley Business School). Both are published academics in the fields of Global Mobility and Leadership, in addition to having experienced international assignments in their respective business careers. Although this project is in its early stages, the initial findings are already consistent and worthy of sharing. Every year businesses in every country send large numbers of key staff on international assignments. The report asks if there really is sufficient value to justify these moves? Due to the Global COVID-19 Pandemic, we have experienced a ‘natural experiment’ that has helped us to answer this question and the answer from our initial findings appears to be ‘yes’.
Is relocation worth it or do modern technologies and ‘agile’ ways of working diminish our appetite for international assignments?
Good research tries to hold steady several variables and alter others to see what happens. In social science this is extremely difficult because there are so many variables. However, COVID-19 presents an almost global natural experiment because one week we all worked in an office and the next, we all worked from home. The variable that was altered was physical presence. For many years, people have asked whether deploying employees on international assignments is truly good value for money: • Why could this work not be done remotely? • Why could this work not be done by occasional visits through commuting? • Why could this work simply not be done by local talent? The pandemic has provided an opportunity to explore whether some of these alternatives are better. Or, whether physical presence matters and why that might be the case. In short, is relocation worth it or do modern technologies and agile ways of working diminish our appetite for international assignments? What questions drive the business case? This research allows us to look back on the forced social experiment to find out what happened when the world decided to work from home.
Virtual And Hybrid: We Are All Experiencing This
Our research makes it very clear that most organisations have had to manage 5 basic variations of international assignments through the pandemic:
The 5 Types of Assignments
The report has identified 5 types of foreign assignment: 1. The traditional physical overseas officebased role. 2. The Overseas-based virtual worker – unable to work at the host office location. 3. The overseas-based hybrid worker. 4. The home-based virtual worker – the intended expatriate who came home or never reached their intended country. 5. A commuter-style virtual and hybrid crossborder worker. Consequently, simple definitions of International Assignment have been revised in response to the overlay of hybrid working with global mobility creating complexity that was hitherto either hidden or not in wide use.
Visibility
One valuable outcome from these complexities is the positive impact and visibility that the Global Mobility (GM) function has achieved. As businesses around the world sought to manage the risks and protect their employees, many businesses identified unofficial ‘off the radar’ assignments. Furthermore, as employees sometimes moved quickly, before official sanction was possible, so GM has been brought in to assess the consequences.
Enhanced Standing
Considerable benefit has been added quickly by explaining and evaluating the many risks and costs to the organisation that were
‘Is relocation worth it or do modern technologies and ‘agile’ ways of working diminish our appetite for international assignments?’
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hidden, being created and continue to arise. The value and standing of GM have been markedly enhanced.
Leadership Requires Presence
Whilst organisations do not always factor in the development of leadership skills in their assessment of value for international assignments, a great many recognise that expanding the global nature of their leadership talent cohorts is a valuable outcome and a source of competitive advantage. Leadership breadth and depth is core to the value proposition behind these assignments, whether implicitly or explicitly. It remains clear, based on the feedback from those that we have interviewed that this value is only truly achievable through physical assignments. In short, whilst it is possible to lead virtually, it is not optimal.
Physical Presence Matters
Many explanations are given for why physical moves are required. This starts with one very simple fact that time-zone differences are often too large to enable real relationships and real teamwork when not physically present in day-to-day business activities. At a simple biological level, we work on a diurnal (daytime) rhythm which needs to be
maintained. Exhaustion kicks in if we try to consistently work to a different timeline to the one we are living in. Even when time zones are not so large, several other factors seem to be important and relevant. Issues such as the speed of learning, the dynamics of teams, the ability to build real networks and rapport and the transfer of culture are all believed to rely on physical presence. These factors also help explain why leadership development grown through international assignments considerably exceeds that achievable through virtual or hybrid alternatives. T h e s e i m p o r t a n t co n s i d e rat i o n s demonstrate how value is released through these assignments. The bottom line, both figuratively and literally, appears to be that physical presence (whether short-term or long-term) is both necessary and sufficient to develop true global leadership capabilities through international work. Being physically present enables leadership presence! The research is ongoing at present and if you should like to discuss it further or indeed participate with a leadership colleague from your organisation, Phil or John Rason, Group Head of Consulting at Santa Fe Relocation, would be delighted to hear from you.
DR PHIL RENSHAW
phil@coachingonthego.co.uk Dir. Phil Renshaw (Visiting Fellow, Cranfield University) and Dr. Jenny Robinson (Visiting Fellow, Henley Business School). Dr Phil and Dr Jenny are Coaches, Consultants, Academics and Authors Coaching On the Go www.coachingonthego.co.uk
JOHN RASON
john.rason@santaferelo.com
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FIDI 2021/22 STATE OF THE INDUSTRY REPORT
FIDI 2021/22 State Of The Industry Report Introduction A New Landscape
If in 2020 international moving was defined by the emergence of, and emergency response to COVID 19, 2021 was characterised by movers understanding more clearly the medium-to long-term effects of this crisis on the industry. After spending the early months of the pandemic speculating as to what these impacts might be, businesses have now experienced them first-hand. They are facing issues including greater administration, higher costs, staffing and material shortages, and ongoing delays to shipments. These are both direct and indirect impacts of COVID, which have interacted with pre-existing challenges in the marketplace – such as industry consolidation and other ongoing structural shifts – adding further complexity and creating the most difficult and uncertain trading environment in living memory. Movers spent 2021 navigating this new landscape, while the climate emergency and other new obstacles loomed larger ahead, demanding that businesses make additional and urgent changes to their operations.
The Pandemic Covid Sets The Scene
As a perfect storm of unparalleled challenges has developed, the pandemic has shifted from centre stage to the setting against which numerous other crises have played out. After a year tackling COVID and working in a new, unpredictable market where change happens frequently and at short notice, by 2021, movers had adapted their operations to deal more effectively with uncertainty. Having introduced them reactively in 2020, most now had in place, as standard, personal protective equipment (PPE), regular testing, and new procedures such as working with smaller crews to make staff and customers feel safer. Many encouraged vaccinations, with some even offering staff incentives (sanctions against non-vaccinated employees have also been discussed, if not implemented). Forward-looking businesses have now developed and incorporated wider employee wellbeing programmes as a permanent and central part of their operations, developing remote working and digital strategies and other changes designed to increase staff wellbeing beyond the context of COVID. Those companies that do this particularly well have created a useful differential in regions affected by severe staff shortages.
During 2021, movers continued to face upheaval from full or partial lockdown measures and other restrictions on international movements, or the effects of staff shortages through illness or self-isolation precautions. Secondary impacts of COVID restrictions have included strikes in October by Italian port workers, protesting the introduction of a mandatory Green Pass, to provide proof of vaccination. But, while COVID-induced disruptions didn’t necessarily get easier for companies during 2021, by now they were, at least, familiar.
During 2021, movers continued to face upheaval from full or partial lockdown measures and other restrictions on international movements, or the effects of staff shortages through illness or self-isolation precautions An Uneven Effect
There were marked disparities in the development of the pandemic across the world and the varied response of authorities made a huge difference to how business flowed in different countries. Andrew Chng, Country Manager at Vanpac Group Asia in Vietnam and FIDI 39 Club Board
member, said: ‘Countries where COVID is better controlled, where the local government has a clearly communicated plan will continue to be a stable and attractive proposition’. Indeed, a June study of the most desirable expatriate destinations by Boston Consulting Group showed countries perceived to have tackled the pandemic well, such as Canada, Japan, New Zealand and Singapore, increased in attractiveness (although it’s worth noting that travel to some of these places remains highly restricted); while those who were considered to have struggled, including the US and several European countries, fell lower down the rankings. The likes of Singapore, which introduced draconian restrictions – and punishments for non-compliance – to fight but ‘live alongside’ COVID, have been able to reduce infections to a level where, during the past year, they have been able to open themselves up much more freely to business than other countries. These countries saw a strong reversal of the outflux of staff experienced during the early months of the pandemic. In August, The Washington Post contrasted Singapore’s approach to that of Hong Kong, which was again tightening quarantine restrictions – a move the paper said could seriously undermine its competitiveness against rival areas. Shifts such as these around the world are altering future demand for moving services, notably in large expatriate hubs, including the United Arab Emirates. At the start of the COVID crisis, many movers feared that, globally, demand for their services would plummet as the result of ongoing restrictions preventing moves and forcing some staff to stay close to home rather than relocate. Instead, after initial lockdown periods ended, pent-up demand coupled with outward moves from areas (including those mentioned above), meant the international industry reported generally strong demand, with ‘neverending’ peak season in some regions. Two years since the start of the pandemic, while difficulties remain, there is still a huge appetite for moving. Many in the industry now believe that having survived the early months of COVID, international demand will continue to rebound, even with the arrival and rapid spread of the Omicron COVID variant in the first quarter of 2022. However, there remains a degree of uncertainty about the coming months – and how quickly, and by how much, corporate demand specifically will recover.
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A World In Crisis
There are also serious questions about the long-term impact of the varied but often interlinked crises that arrived in COVID’s wake, materialising in 2020 and becoming a key theme during the year that followed. If the pandemic initially threatened to erode the moving industry’s customer base, these varied and interrelated pressures have now threatened the way in which it delivers its services. The global shipping industry has been in a state of severe imbalance since the early months of the pandemic. This began with much of the globe in lockdown and was followed by the uneven loosening of these restrictions between different countries; and was made steadily more complex as excesses of containers built up in some regions and they became acutely scarce in others. ‘Ports that become increasingly full mean diminishing efficiencies, and shipping lines may avoid them and route services elsewhere’, says Gavin Simmonds, Commercial Policy Director at the UK-based Chamber of Shipping, highlighting that logistics operations now need more careful planning than ever.
Diminishing Efficiencies
The international mismatch has caused processing backlogs and ‘diminishing efficiencies’ in many ports around the world and previously smooth global flows of trade have become irregular and unpredictable. Fines have been levied in ports (including unlimited fines at the ports of Los Angeles and Long Beach) in attempts to lessen congestion, but international shipments continue to face severe delays. Movers have reported that, because of the disruption, the price of a single shipping container had skyrocketed, with one Singapore-based Affiliate reporting a rise from approximately US$2,000 to more than US$10,000. Freight from the Far East to Europe and the US is at an all-time high, according to Chng, who adds: ‘Rates of certain lanes have risen 600 per cent, which has made private moves prohibitive for many self-paying clients’. With single customers often using one or more whole containers for a move, the increases in shipping prices are impacting on them particularly hard. The accidental blockage and subsequent impounding of one of the world’s major trade routes, the Suez Canal, by the container ship the Ever Given, for more than 100 days, only added to the global problems and spiralling costs for movers using international services. Meanwhile, shipments containing household goods have reportedly been given lower priority by some shipping lines. Using air freight as an alternative has been a necessary option for some movers but, with 2020 the worst year on record for air travel, this is a sector that has been beset
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with its own issues. With many passenger flights not running, space has been limited to cargo-only services, pushing prices up in this sector, too. The price of raw materials has also increased internationally, as demand has waned and bounced back at different rates depending on location. This has further impacted on movers’ costs in areas such as wood and paper for packing.
Regional Differences
These delays, irregular movements and increased costs have affected movers, in every part of the world but have been compounded differently according to the specific issues affecting each country. Staff shortages, for example, have challenged many businesses in logistics and related sectors in much of Europe and the US, pushing expected wages up and threatening the viability of existing employment models there. Asia, Africa, and Latin America have been comparatively unaffected by these issues. In Europe, Brexit has increased the time, administration, and cost of moving goods between the UK and the European Union, adding complexity in this part of the world, while border crossings have been additional, major sources of difference and continuous change for the mobility industry between different countries throughout the pandemic.
Plan And Communicate
While global unpredictability and increased costs are unavoidable, savvy movers have adjusted operations to mitigate the worst impacts on customers. The lack of staff resources brought about by the so-called ‘Great Resignation’ can also be tackled – to an extent. Movers are looking carefully at how they can make their businesses more attractive to prospective employees, and to keep hold of them once they are there. This forms part of an all-encompassing and growing imperative for companies to become sustainable businesses in all definitions of the word. This approach was important but often forgotten before COVID – it now appears essential. As 2021 came to an end, there were some reported signs of stability returning to the market, but some expect that as well as living with COVID, the ‘new normal’ will also involve living with higher prices and increased volatility, indefinitely.
Sustainability
In this new world, sustainability has become a major theme, too. Since the Paris Climate Agreement was signed by almost every nation in 2016, sustainability has shot up the agenda for businesses around the globe. However, after being deprioritised as governments battled the first months of the pandemic (which even now continues to generate large amounts of unrecyclable waste from personal protective equipment (PPE) –
with 6.8 billion disposable masks used worldwide each day according to one MIT University study), the ‘climate emergency’ is now the primary issue facing the world. Driven by customers, and many staff within organisations too, and enshrined in a growing raft of national and international legislation, movers are now being called upon to play a major role in transforming themselves into sustainable operators that don’t impact negatively – or, better, have a positive impact – on the environment. Most corporations are now looking at not just their own impact but the credentials of their suppliers, too, and demanding changes that mitigate the imprint of their entire supply chain. Derrick Young, Director of Transportation Governance at BGRS, illustrated this: ‘A lot of our clients are being driven by the principles of measuring and reducing and this flows into their HR programmes. We have clients that are saying, we want to hire people with a mindset that is green, and we need to have flexible policies so they can choose a green move’. These forces are changing the nature of some relocation programmes, which are moving towards flexible lump sum packages with environment-focused options such as sea rather than air freight – or allowing employees to select furniture rental rather than moving their household goods at all. Movers are being asked to choose their sustainability goals carefully, to focus not on box ticking, but on making real and long-lasting changes – and to be open about what they are doing, too. As with supply chain crises, it is essential for companies to be completely clear with their customers and partners about what they can and can’t achieve. With international transport – trucks, ships and planes – and offices making up the bulk of moving businesses’ carbon emissions, and many packing materials being used too, most have targeted reductions, efficiencies and switches in these three areas first, to meet or in anticipation of new legislative requirements. However, many companies have gone beyond these ‘entry level’ adjustments, looking at ways in which they can make a difference not only to the environment, but also to their employees and communities in which they operate – and their bottom line, too. Indeed, in the long-term it is those movers who are embracing this ‘beyond green’, holistic view of sustainability who will be the winners, according to commentators such as Defour. ‘The real green transition will be about more than “being green”,’ she says. The shift towards greater all-round sustainability brings with it the promise of helping these businesses address their longstanding weaknesses, as well as some of the issues created by the pandemic. To do this well, many companies are increasing their transparency and working towards much closer collaboration with supply chain partners.
FIDI 2021/22 STATE OF THE INDUSTRY REPORT Goal-setting and measurement of progress is crucial, and some international moving businesses have begun to benchmark themselves against accepted metrics such as those outlined in the United Nations 17. “We have clients that are saying, we want to hire people with a mindset that is green” says Derrick Young. However, there remains a lack of globally accepted standards, with many different programmes offering solutions for measuring and reporting sustainability, not all of which are transparent or verifiable.
Diversity On The Rise
International diversity-focused movements including #MeToo and #BlackLivesMatter have helped a drive towards a broader, more open approach to recruiting, seeking to widen the participation across gender, ethnic and cultural groups and offer better opportunities for all. Management, staff, and clients have become more engaged in this issue, with business championing relevant causes. For example, Australian FIDI Affiliate Grace is supporting a national charity that aims to increase literacy in remote indigenous communities, and forming an indigenous working group made of key managers, which is chaired by an indigenous staff member. These developments aren’t only bringing one-way benefits. More diverse organisations can provide opportunities to understand and connect with a wider customer base, and create bespoke services, which is better for business and an important part of creating more socially sustainable companies, too. How this powerful and emotive movement will alter the international moving business – both in terms of its own companies and those of its supply chain partners and corporate clients – is yet to become fully clear. In South Africa, government Black Economic Empowerment (BEE) initiatives designed to redress inequality have seen companies legally obliged to meet percentages of staff from specific groups. While such quotas are perhaps unlikely to be adopted more widely, transparent approaches like open publishing of company salaries are becoming more common as measures of progress made towards making more diverse organisations. More diverse recruitment policies – including the employment of younger staff with up-to-date tech skills – will help movers with digitisation, another process that was already under way but accelerated significantly by the pandemic. Prior to 2020, remote working was possible, but not used widely, while remote survey platforms had been touted but were still to take off. The pandemic brought these and other digital solutions to the frontline of operations, allowing movers to get the job done while minimising physical closeness between staff and customers – and giving them first-hand experience of the efficiencies and cost savings that this technology brings.
The Digitisation Of Moving
According to Brielle Jones at Triglobal – a Dutch company connecting movers to online consumers using multiple tools – the pandemic led to a greater uptake of internet use for moving services. ‘Lockdowns and working from home have pushed the remaining customers online and the internet is unquestionably the place where customers now go to find a mover’, she said. ‘Movers and consumers are at ease with incorporating online volume calculators and digital surveys into their sales processes. The quickquote functionality is also being used on many moving websites to meet customer demands and expectations on price’.
Hybrid And Remote Working
Clearly, the proliferation of remote working could threaten part of movers’ customer base – while some businesses are looking at emerging hybrid remote/ office-based options, too. However, as much of the world began to move again, many were optimistic that demand was rebounding and would continue to do so. There are many jobs which – after the recent test – don’t appear to lend themselves well to remote work; and the relocation and travel that comes with jobs at international corporations remain an attractive draw for many employees, too. The speed with which remote and hybrid office-based/remote working has been accepted means companies have had to develop in-house policies to cover employees operating in entirely new conditions. Organisations including Worldwide ERC have highlighted the need for governments to legislate in order to protect staff rights and wellbeing, and business’s interests, in this emerging area.
A Focus On Data Security
Meanwhile, as more of the relocation process has been digitised, the increased streamlining of processes and use of customer data are raising vital new questions of standardisation, data protection and regulation for relocation businesses. Private information is often requested on shipping documents, and it can be sold or shared by third parties, putting customers at risk of identity theft, fraud or other criminal activity. ‘Data security and compliance have become a major focus’, said Bell at Asian Tigers. ‘Groups like ours devote considerable time and resources to meet the many demands we face. It is a costly exercise, but a necessary one, and one that is here to stay’. Illegal use of Personal Identifiable Information (PII) is an increasing issue and there have already been high-profile cases of data breaches in shipping and logistics businesses, including French container transport and shipping company CMA CGM. In June 2021, following lobbying by military and moving associations including AMSA, ERA and IAM, the US Senate passed the US Competition and Innovation Act (USICA), to protect the details of military personnel during moves.
By the beginning of last year, some 130 countries had launched data privacy laws, around 66 per cent of the world’s governments. And, while certain regions have developed common strategies – such as the EU’s Digital Services Act – a widely-accepted, standardised international approach has not yet been tabled.
Pre-Existing Issues
As the world continues to open up again, the above issues - the ongoing impact of COVID; global supply chain crises; the pressing need for sustainability, financial security and diversity in business; and data privacy issues – are being joined by those that pre-date the pandemic and bring their own unique impacts on mobility, albeit now in a new context. These include the forces of industry consolidation in the form of mergers and takeovers and the drawn-out award process of a single-provider contract by USTRANSCOM, which as 2021 ended had entered another phase after one of the losing bidders, American Roll-On Roll-Off Carrier Group (ARC), filed a protest to the Government Accountability Office (GAO). The US contract business is reportedly worth nearly US$20 billion across its longest possible duration, with domestic small business subcontractors taking an estimated share of 40 per cent of the overall value of the contract.
Faring Better
At the end of the pandemic’s second year, there are several notable variations in the impacts of COVID 19 on the international mobility industry. These include the effects on different regions of the world, driven diversely by factors including the area’s make-up of expatriates and nationals and the local government’s approach to implementing, enforcing and lifting restrictions. There are differences in the impacts depending on industry sector, with movers enjoying solid demands for their core services, while emerging requirements for greater transparency in supply chains may challenge RMCs in the future. There has been discussion, too, about the variance caused to asset heavy movers compared with asset-light movers, with the latter able to leverage their flexibility and shop around for best prices, and the former capable of responding quickly – or sell/rent assets to keep cash flow smooth. Many movers were also able to use their assets – trucks, offices and staff – to help deliver emergency and other services, generating new revenue streams during times of slower demand and connecting them to new clients, too. Some also began to work directly with large corporate accounts, as these eschewed established channels to get jobs completed by those with knowledge of often rapidly changing local conditions and able to mobilise fast.
FIDI
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Best And Worst Destinations For Expatriates The Expat Insider 2022 survey by InterNations reveals the best and worst destinations for living and working abroad. • Mexico, Indonesia, Taiwan, Portugal, Spain, the UAE, Vietnam, Thailand, Australia, and Singapore are the best destinations for expats in 2022 • The worst destinations for expats are Kuwait (52nd), New Zealand, Hong Kong, Cyprus, Luxembourg, Japan, South Africa, Turkey, Italy, and Malta (43rd) • The United Kingdom ranks 37th out of 52: expats find it rewarding to work there, but are unhappy with their personal finances. Munich, 12 July 2022 - For the ninth time, InterNations, the world’s largest expat community with more than 4 million members, has published the results of its Expat Insider survey. With nearly 12,000 respondents, it is one of the most extensive surveys about living and working abroad, providing insights into expat life in 52 destinations. The survey offers in-depth information on expats’ satisfaction with the Quality of Life, Ease of Settling In, Working Abroad, and Personal Finance in their
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respective country of residence. For the first time, the ranking also includes the new Expat Essentials Index, which covers digital life, admin topics, housing, and language. The United Kingdom comes 37th out of 52 destinations in the Expat Insider 2022 survey. The country ranks slightly better than average in the Working Abroad (15th) and the Expat Essentials (17th) Indices. However, it gets only mediocre results in the Quality of Life (31st) and Ease of Settling In (36th) Indices, and even lands in the bottom 3 of the Personal Finance Index (50th). Overall, 67% of expats are happy with their life in the UK, compared to 71% globally. Mexico (1st), Indonesia (2nd), and Taiwan (3rd) make up the top 3 destinations, and they all rank very well in the Ease of Settling In and Personal Finance Indices. On the other hand, the bottom 3 destinations, Kuwait (52nd), New Zealand, and Hong Kong, all perform poorly in terms of personal finances for expats. While Kuwait ranks among the worst destinations worldwide for all factors, expats in New Zealand struggle with their career, and those in Hong Kong are unhappy with the local environment.
THE UK IN THE EXPAT INSIDER 2022 SURVEY Dissatisfaction With Personal Finances
The United Kingdom ranks 37th in the Expat Insider 2022 survey overall, but lands in the bottom 3 of the Personal Finance Index (50th). Only Luxembourg (51st) and New Zealand (52nd) perform even worse in this regard. Exactly one in four expats (25%) is unhappy with their financial situation (vs. 21% globally), and over one in three (35%) feel that their disposable household income is not enough to lead a comfortable life (vs. 28% globally). When asked what they dislike most about life in the UK, a US American expat notes that “the cost of living is very high”. In fact, more than half (54%) are dissatisfied with the general cost of living (vs. 35% globally). It probably does not help that the gross yearly income of expats in the UK is below average: 78% earn 75,000 USD or less per year (vs. 68% globally), while just 14% make 100,000 USD or more (vs. 21% globally).
A Great Working Environment
Salary is also a topic in the Working Abroad Index (15th), and 22% of expats feel paid unfairly based on their industry, qualifications,
BEST AND WORST DESTINATIONS FOR EXPATRIATES and role (vs. 20% globally). Except for this one factor, they are quite happy with their working life in the UK. Expats are satisfied with their career opportunities (70% vs. 58% globally) and feel that moving to the UK has improved their career prospects (74% vs. 60% globally). More than three in five (62%) also rate the local job market positively (vs. 47% globally), all of which lands the UK in fourth place in the Career Prospects Subcategory. “Life is easier here because I was able to start a new career and grow in the industry I work in”, says an expat from Poland. The UK also performs very well in the Work Culture and Satisfaction Subcategory (10th). Over two in three expats (69%) feel that the business culture in the UK encourages creativity and thinking outside the box (vs. 51% globally). It also supports flexibility (77% happy vs. 60% globally) and promotes independent work (62% happy vs. 45% globally).
Difficulties With Housing
Another financial issue arises in the Housing Subcategory (42nd) of the Expat Essentials Index (17th). While close to half the expats (48%) report that it is easy to find housing, just 6 percentage points less than the global average (54%), 60% find it unaffordable (vs. 43% globally). Close to three in ten (27%) even describe it as completely unaffordable, compared to 15% globally. “The properties are small, and the interior quality is usually substandard - I find it hard to consider any of these places home”, a Dutch expat comments, also pointing out “the short contracts, renewals, and the risk to be thrown out”.
Few Bureaucratic Obstacles
On the bright side, expats find Digital Life (12th) in the United Kingdom quite satisfying. Nearly four in five expats (79%) are happy with the availability of administrative/ government services online (vs. 61% globally), and another 89% are delighted with the unrestricted access to online services (vs. 82% globally). Moreover, the UK also ranks quite well in the Admin Topics Subcategory (13th). When it comes to dealing with the local bureaucracy/authorities, the country ranks 6th out of 52, with 62% of expats rating this factor positively (vs. 40% globally).
A Worrying Healthcare System
The United Kingdom ranks midfield in the Quality of Life Index (31st). Among all the subcategories of the index, it performs best for Leisure Options (26th), with expats particularly enjoying the culture and nightlife (72% happy vs. 67% globally). On the other hand, it performs worst in the Health and Well-Being Subcategory (39th). Expats are unhappy with the availability (42nd) and quality (40th) of healthcare, and 24% find it difficult to access all the
healthcare services that they need (vs. 17% globally). However, healthcare in the UK at least seems to be affordable (25th): 66% of expats say so, compared to 61% globally.
Disappointing Transportation And Climate
The same cannot be said about the Travel and Transit Subcategory (33rd), in which the United Kingdom ranks 50th for the affordability of public transportation. About one in three expats (33%) find it unaffordable, more than double the global average (15%). On the other hand, 77% are happy with the availability of public transportation, compared to 73% globally. Expats also struggle with the climate and weather (47th) in the UK. Two in five (40%) are unhappy with this factor, 21 percentage points more than the global average. “The weather is difficult, and during the winter the lack of daylight can be depressing”, a Chinese expat explains.
A Slightly Unwelcoming Environment
The United Kingdom has a rather mediocre performance for several factors in the Ease of Settling In Index (36th). In terms of Culture and Welcome (30th), 17% of expats do not feel welcome there (vs. 16% globally). One in four expats (25%) also does not feel at home in the UK, compared to a global average of 21%. The same goes for Local Friendliness (34th): 19% of expats think the locals are not friendly towards foreign residents (vs. 18% globally). Moreover, 17% of expats rate the general friendliness of the local population negatively, exactly the same as the global average of 17%.
The Best And Worst Destinations For Living And Working Abroad In 2022
According to the Expat Insider 2022 survey results, Mexico (1st), Indonesia, Taiwan, Portugal, Spain, the UAE, Vietnam, Thailand, Australia, and Singapore (10th) are the best destinations for expats. The top 5 destinations stand out with regard to the Ease of Settling In and Personal Finance. They also tend to perform well in the Expat Essentials Index. While they all land just midfield in the Working Abroad Index, their results in the Quality of Life Index are somewhat mixed. Spain (1st), Taiwan, and Portugal make up the top 3 worldwide, but expats in Mexico (24th) and Indonesia (41st) are not satisfied with the local quality of life. The worst destinations for expats are Kuwait (52nd), New Zealand, Hong Kong, Cyprus, Luxembourg, Japan, South Africa, Turkey, Italy, and Malta (43rd). Kuwait is among the world’s worst destinations in each individual index as well as in the overall ranking. Moreover, all bottom 5 destinations
have an average to poor performance in the Working Abroad and Personal Finance Indices. While Italy is an exception regarding Personal Finance (33rd), it only ranks 48th in the Expat Essentials Index.
THE TOP 10 DESTINATIONS FOR EXPATS IN 2022 1. Mexico: The Easiest Country To Settle In
Expats in Mexico are happy with their Personal Finance (2nd) and the Ease of Settling In (1st). In fact, the country comes first in the Local Friendliness, Finding Friends, and Culture and Welcome Subcategories. Expats describe the local residents as friendly (90% vs. 66% globally) and find it easy to make friends among them (75% vs. 42% globally). The country narrowly misses out on a top 10 spot in the Expat Essentials Index (11th). While 64% of expats found it easy to get a visa in order to move to Mexico (vs. 56% globally), 53% struggle with the local bureaucracy (vs. 39% globally). Mexico performs worst, but still well, in the Working Abroad (17th) and Quality of Life (24th) Indices. Expats love, for example, the culinary variety and dining options (92% vs. 77% globally) and the natural environment (90% vs. 83% globally), but they are unhappy with the local air quality (36% vs. 19% globally). Overall, 91% of expats are happy with their life in Mexico.
2. Indonesia: Where Your Money Goes A Long Way
Indonesia performs best in the Ease of Settling In (1st) and Personal Finance (3rd) Indices: close to two in three expats (64%) say that their disposable household income is more than enough to lead a comfortable life (vs. 45% globally). The country also ranks among the best worldwide in the Expat Essentials Index (6th), which is mainly due to the Language (6th) and Housing (2nd) Subcategories. Housing in Indonesia is easy to find (84% vs. 54% globally) and to afford (74% vs. 39% globally). While its performance in the Working Abroad Index (28th) is rather mediocre, it receives its worst results in the Quality of Life Index (41st). Expats are unhappy with the quality of medical care (28% vs. 14% globally), the availability of green goods and services (35% vs. 17% globally), and the infrastructure for cars (40% vs. 13% globally). Overall, 91% of expats are happy with their life in Indonesia.
3. Taiwan: Safe And Financially Stable
Taiwan ranks best in the Quality of Life Index (2nd). Expats find healthcare affordable (100% vs. 61% globally) and widely available (98% vs. 73% globally), and they generally feel safe there (98% vs. 81% globally). Taiwan also ranks
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among the top 10 for the Ease of Settling In (6th) and Personal Finance (8th) Indices. In fact, 70% are satisfied with their financial situation, compared to 60% globally. While 85% also feel fairly paid for their work (vs. 62% globally), Taiwan still has more of an average performance in the Working Abroad Index (22nd). This is due to a lack of flexibility (41% unhappy vs. 19% globally), creativity (41% unhappy vs. 26% globally), and flat hierarchies (46% unhappy vs. 28% globally) in the local business culture. Lastly, it also gets a mediocre result in the Expat Essentials Index (23rd). Overall, 76% of expats are happy with their life in Taiwan.
4. Portugal: Sunny, Friendly And Lots To Do
About one-quarter of expats (24%) moved to Portugal for a better quality of life, and the country does rank well in the Quality of Life Index (4th). Expats enjoy the weather (94% vs. 62% globally), the air quality (89% vs. 65% globally), and the opportunities for recreational sports (87% vs. 75% globally). Since they also find it easy to make local friends (51% vs. 42% globally) and are happy with their social life (67% vs. 56% globally), Portugal ranks fifth in the Ease of Settling In Index. What is more, Portugal ranks 10th in the Personal Finance Index and 19th in the Expat Essentials Index: more than half the expats (52%) find it hard to deal with the local bureaucracy (vs. 39% globally). Lastly, Portugal does not perform well in the Working Abroad Index (35th), since expats are unhappy with the local job market (39% vs. 27% globally) and their personal career opportunities (27% vs. 22% globally). Overall, 85% of expats are happy with their life in Portugal.
5. Spain: The Best Quality Of Life
Spain is voted first worldwide in the Quality of Life Index (1st). Expats love the variety of culinary and dining options on offer (91% vs. 77% globally), and they describe healthcare as both affordable (79% vs. 61% globally) and available (82% vs. 73% globally). While Spain ranks tenth in the Ease of Settling In Index, it narrowly misses out on a top 10 spot in the Personal Finance Index (11th). Still, 70% are happy with the cost of living, compared to 45% globally. Spain performs well in the Expat Essentials Index (14th): while expats like the opportunities to pay without cash (92% vs. 84% globally), 52% find it hard to deal with the local bureaucracy (vs. 39% globally). Lastly, Spain gets its worst results in the Working Abroad Index (37th), which is mainly due to a lack of personal career opportunities (27% vs. 22% globally) and not feeling fairly paid (24% vs. 20% globally). Overall, 83% of expats are happy with their life in Spain.
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6. The UAE: Amazing Career Opportunities
Expats in the UAE are pleased with the Expat Essentials Index (2nd). It is easy for them to get a visa to move there (83% vs. 56% globally) and to deal with the local bureaucracy (61% vs. 40% globally). Additionally, the UAE ranks fifth in both the Quality of Life and Working Abroad Indices. Expats are happy with their personal career opportunities (65% vs. 58% globally) and feel that moving there has improved their career prospects (79% vs. 60% globally). The Ease of Settling In Index (13th) has mostly positive results, while expats struggle a bit with the Personal Finance Index (34th). Over one in three expats (36%) feel that their disposable household income is not enough to lead a comfortable life (vs. 28% globally). This might be related to the fact that only 55% feel that they are fairly paid for their work, based on industry, qualifications, and their role (vs. 62% globally). Overall, 71% of expats are happy with their life in the UAE.
7. Vietnam: The Best For Personal Finance
Vietnam is the world’s best country in the Personal Finance Index (1st), and 92% of expats say that their disposable household income is enough or more than enough to lead a comfortable life (vs. 72% globally). The country ranks well in the Ease of Settling In Index (9th), too, since most expats (84%) describe the local residents as generally friendly (vs. 66% globally). They also feel welcome (83% vs. 66% globally) and at home (71% vs. 62% globally) in Vietnam. While the country still ranks midfield for Working Abroad (29th), it lands in the bottom 10 of both the Expat Essentials (46th) and Quality of Life (48th) Indices. Expats find it difficult to deal with the local bureaucracy (66% vs. 39% globally) and to open a local bank account (41% vs. 21% globally). They are also unhappy with the quality of healthcare (23% vs. 14% globally) and worry about the urban environment (53% vs. 17% globally). Overall, 84% of expats are happy with their life in Vietnam.
8. Thailand: Great Finances, Social Life And Medical Care
Thailand excels in the Personal Finance Index (4th) - 70% are happy with their personal finances (vs. 60% globally) - and narrowly misses out on a top 10 spot in the Ease of Settling In Index (11th). Expats love their social life (69% satisfied vs. 56% globally), and more than half (52%) say that making local friends is easy, compared to 42% globally. While Thailand also performs well in the Expat Essentials Index (18th), it lags behind in the Quality of Life Index (35th). Expats are happy with the culinary variety and dining
options (90% vs. 77% globally) and the quality of medical care (85% vs. 72% globally), but 45% rate the air quality negatively (vs. 19% globally). Lastly, it lands among the bottom 10 in the Working Abroad Index (45th), which is mainly due to a lack of creativity (41% vs. 26% globally) and independent work (45% vs. 28% globally) in the local business culture. Overall, 77% of expats are happy with their life in Thailand.
9. Australia: Good For Work And Relaxation
Expats in Australia are particularly happy with the Working Abroad Index (2nd). They are not only satisfied with the local job market (62% vs. 47% globally) and their personal career opportunities (64% vs. 58% globally) but also with their work-life balance (70% vs. 62% globally). Thanks to an amazing natural environment (94% happy vs. 83% globally) and the opportunities for recreational sports (88% vs. 75% globally), Australia also ranks well in the Quality of Life Index (14th). The country only performs slightly worse in the Expat Essentials (16th) and Ease of Settling In (17th) Indices. Expats find it easy to get used to the local culture (75% vs. 62% globally) and feel at home there (65% vs. 62% globally). When it comes to the Personal Finance Index (30th), they are unhappy with the local cost of living (44% vs. 35% globally), but 71% still have enough or more than enough to lead a comfortable life (vs. 72% globally). Overall, 75% of expats are happy with their life in Australia.
10. Singapore: Easy To Manage Everyday Life
Singapore ranks best in the Expat Essentials Index (3rd). For example, expats find it easy to deal with the local authorities (63% vs. 40% globally) and to open a local bank account (81% vs. 64% globally). It also performs well in the Quality of Life Index (10th), since expats are happy with the availability of public transportation (97% vs. 73% globally), find it easy to access all the healthcare services they need (84% vs. 67% globally), and generally feel safe (99% vs. 81% globally). Singapore also receives mostly favourable results in the Working Abroad (18th) and Personal Finance (19th) Indices. While 87% feel that their disposable household income is enough or more than enough to lead a comfortable life (vs. 72% globally), they are still unhappy with the general cost of living (56% vs. 35% globally.) In the Ease of Settling In Index (31st), some local residents are perceived as unfriendly towards foreign residents (22% vs. 18% globally), but expats still find it easy to make local friends (48% vs. 42% globally). Overall, 73% of expats are happy with their life in Singapore.
BEST AND WORST DESTINATIONS FOR EXPATRIATES THE BOTTOM 10 DESTINATIONS FOR EXPATS IN 2022 52. Kuwait: Low Quality Of Life And No Friends
Kuwait not only ranks last in the Expat Insider 2022 survey overall, but also in the bottom 10 of each index. It is rated worst in terms of Quality of Life and Ease of Settling In (52nd for each): for example, expats are unhappy with the natural environment (65% vs. 8% globally) and feel that they cannot openly express their opinions (57% vs. 18% globally). They also perceive the local residents as unfriendly (44% vs. 17% globally) and rate their social life negatively (50% vs. 26% globally). The Working Abroad Index (51st) does not look much better. Expats are unhappy with their career opportunities (39% vs. 22% globally) and their work-life balance (37% vs. 19% globally). While Kuwait ranks 49th in the Expat Essentials Index, it performs best for Personal Finance (45th): 76% of expats feel that their disposable household income is enough or more than enough to lead a comfortable life (vs. 72% globally). Overall, 37% of expats are happy with their life in Kuwait.
51. New Zealand: Too Hard To Get A Job And Too Expensive
Expats in New Zealand struggle the most with their Personal Finance (52nd): they rate the general cost of living (75% vs. 35% globally) and their financial situation (30% vs. 21% globally) negatively. It might play a role
that 32% do not feel fairly paid for their work (vs. 20% globally). Since 15% also do not see a purpose in their work (vs. 9% globally) and 26% do not like their working hours (vs. 17% globally), New Zealand only ranks 42nd in the Working Abroad Index. New Zealand has a mediocre performance in the Expat Essentials and Quality of Life Indices (39th for each). The latter is mainly due to the high transportation costs (36% vs. 17% globally) and a lack of culture and nightlife (40% vs. 16% globally). But expats love the natural environment (95% vs. 83% globally) and the opportunities for recreational sports (84% vs. 75% globally). Lastly, the country ranks 34th for the Ease of Settling In. Overall, 60% of expats are happy with their life in New Zealand.
50. Hong Kong: Improved Career Prospects But No Room For Creativity
Expats rank Hong Kong among the bottom 10 in the Personal Finance Index (44th), and 68% are unhappy with the general cost of living (vs. 35% globally). The destination narrowly escapes the bottom 10 in the Working Abroad Index (41st): 46% miss creativity in the local business culture (vs. 26% globally), but moving to Hong Kong has indeed improved their career prospects (70% vs. 60% globally). Things do not look much better in the Quality of Life Index (40th). While the availability (96% vs. 73% globally) and affordability (93% vs. 70% globally) of public
transportation is a highlight, expats feel that they cannot openly express themselves and their opinions (56% vs. 18% globally). They are also unhappy with the urban environment (33% vs. 17% globally). Hong Kong does best, but still not very well, in the Expat Essentials (35th) and Ease of Settling In (33rd) Indices. Overall, 56% of expats are happy with their life in Hong Kong.
49. Cyprus: A Lack Of Career Prospects
Cyprus ranks worst in the Working Abroad Index (49th): expats are unhappy with their personal career opportunities (34% vs. 22% globally) and working hours (29% vs. 17% globally). Nor do they see a purpose in their job (22% vs. 9% globally). Close to three in ten (28%) also feel they are not fairly paid (vs. 20% globally), which might be one reason why they also rate their personal finances negatively (35% vs. 21% globally). Overall, Cyprus only ranks 47th in the Personal Finance Index. Cyprus does a bit better in the Quality of Life (37th) and Expat Essentials (34th) Indices. In the latter, 34% are unhappy with the availability of government services online (vs. 21% globally). In the end, the country’s best, but still mediocre, performance is in the Ease of Settling In Index (27th): 62% of expats feel welcome (vs. 66% globally), and 58% are happy with their social life (vs. 56% globally). Overall, 66% of expats are happy with their life in Cyprus.
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48. Luxembourg: Where Expats Have Nothing To Do
Luxembourg ranks best in the Quality of Life Index (21st). While expats are happy with the affordability of public transportation (97% vs. 70% globally) and the political stability (89% vs. 64% globally), the country even lands in the bottom 3 of the Leisure Options Subcategory (50th). For example, the culture and nightlife (36% vs. 16% globally) and the opportunities for recreational sports (18% vs. 11% globally) are rated negatively. Thanks to the good state of its economy (89% vs. 64% globally), Luxembourg does well in the Working Abroad Index (27th). But 26% are unsatisfied with their job in general (vs. 16% globally). While the result for the Expat Essentials Index (38th) is still mediocre, Luxembourg lands in the bottom 10 in the Ease of Settling In Index (46th). Expats are unhappy with their social life (42% vs. 26% globally) and lack a personal support network (35% vs. 24% globally). Lastly, the country comes 51st in the Personal Finance Index. Overall, 60% of expats are happy with their life in Luxembourg.
47. Japan: Tough Working And Personal Life
Coming second to last, Japan ranks worst in the Expat Essentials Index (51st). Expats find it hard to pay without cash (20% vs. 8% globally) and are unhappy with the availability of government services online (35% vs. 21% globally). The country also lands in the bottom 10 for both the Ease of Settling In (45th) - 30% find it hard to get used to the local culture (vs. 19% globally) - and Working Abroad (43rd) Indices. The latter is mainly due to their unhappiness with their working hours (25% vs. 17% globally) and work-life balance (31% vs. 19% globally). Moreover, 25% feel they are not fairly paid for their work (vs. 20% globally). Japan ranks midfield for Personal Finance (28th) and even 17th for the Quality of Life. Expats generally feel safe (93% vs. 81% globally) and find it easy and safe to get around on foot and/or by bicycle (89% vs. 77% globally). Overall, 66% of expats are happy with their life in Japan.
46. South Africa: Where Expats Worry About Their Jobs And Their Safety
South Africa lands among the bottom 10 in the Working Abroad (46th) and Quality of Life (43rd) Indices. Expats worry about their job security (36% vs. 20% globally), are unhappy with the local job market (47% vs. 27% globally), and do not feel fairly paid (28% vs. 20% globally). They also rate their personal safety (48% vs. 9% globally) and the availability of public transportation negatively (42% vs. 17% globally). The country does not perform much better for Personal Finance (42nd), but comes 28th in the Expat Essentials Index. Still, expats found it hard to get a visa (45%
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unhappy vs. 24% globally) and struggle when dealing with the local bureaucracy (54% vs. 39% globally). Thanks to a satisfying social life (59% vs. 56% globally) and the relative ease of making local friends (46% vs. 42% globally), it ranks 26th in the Ease of Settling In Index. Overall, 61% of expats are happy with their life in South Africa.
45. Turkey: Worst Rated For Working Abroad
Expats in Turkey are extremely unhappy with the state of the economy (57% vs. 17% globally) and their personal career opportunities (33% vs. 22% globally), ranking the country worst worldwide in the Working Abroad Index (52nd). What is more, 27% do not feel fairly paid for their work (vs. 20% globally). This might also influence expats’ unhappiness with their financial situation (26% vs. 21% globally). Overall, Turkey ranks 36th in both the Personal Finance and Expat Essentials Indices. While expats had no issues getting a visa (72% vs. 56% globally), they are unhappy with the restricted access to online services (14% vs. 7% globally). Turkey performs a lot better in the Quality of Life (30th) and Ease of Settling In (22nd) Indices. Expats describe the local residents as friendly (67% vs. 66% globally) and find it fairly easy to make local friends (51% vs. 42% globally). Overall, 62% of expats are happy with their life in Turkey.
44. Italy: Hard To Navigate Everyday Life
Italy performs worst in the Expat Essentials Index (48th). Among other things, expats find it hard to deal with the local bureaucracy (68% vs. 39% globally) and to open a local bank account (35% vs. 21% globally). The country lands among the bottom 10 in the Working Abroad Index (47th), where 29% of expats do not feel fairly paid for their work (vs. 20% globally). They are also unhappy with the local job market (45% vs. 27% globally) and their personal career opportunities (34% vs. 22% globally). The country performs much better in terms of Personal Finance (33rd) and the Ease of Settling In (29th). In fact, 68% find it easy to get used to the local culture (vs. 62% globally). Quality of Life (28th) is Italy’s best index: expats particularly enjoy the climate and weather (82% vs. 62% globally), as well as the culinary variety and dining options (84% vs. 77% globally). Overall, 71% of expats are happy with their life in Italy.
43. Malta: A Low Quality Of Life
Expats in Malta are particularly unhappy with the infrastructure for cars (57% vs. 13% globally), the urban environment (65% vs. 17% globally), and the availability of green goods and services (44% vs. 17% globally), ranking the island 49th in the Quality of Life Index. It only performs slightly better in the Expat Essentials Index (43rd), where, for example, expats find it extremely hard to open a local bank account (69% vs. 21% globally).
In the Working Abroad Index (36th), expats are quite happy with their personal career opportunities (57% vs. 58% globally) but find that the local business culture does not encourage creativity (38% vs. 26% globally). While Malta ranks 26th in the Personal Finance Index, it performs best in the Ease of Settling In Index (21st): expats feel quite at home there (61% vs. 62% globally) and have a personal support network (59% vs. 59% globally). Overall, 68% of expats are happy with their life in Malta.
ABOUT THE INTERNATIONS EXPAT INSIDER 2022 SURVEY
For its annual Expat Insider survey, InterNations asked 11,970 expats representing 177 nationalities and living in 181 countries or territories to provide information on various aspects of expat life, as well as their gender, age, and nationality. Participants were asked to rate up to 56 different aspects of life abroad on a scale of one to seven. The rating process emphasized the respondents’ personal satisfaction with these aspects, considering both emotional topics and more factual aspects with equal weight. The respondents’ ratings of the individual factors were then bundled in various combinations for a total of 16 subcategories, and their mean values were used to draw up five topical indices: Quality of Life, Ease of Settling In, Working Abroad, Personal Finance, and Expat Essentials. These indices were further averaged together with expats' general happiness with their life abroad in order to rank 52 expat destinations around the world. In 2022, the top 10 are Mexico, Indonesia, Taiwan, Portugal, Spain, the UAE, Vietnam, Thailand, Australia, and Singapore. To be featured in the indices and consequently in the overall ranking, a sample size of at least 50 survey participants per destination was necessary.
ABOUT INTERNATIONS
With more than 4 million members in 420 cities around the world, InterNations is the largest global community and a source of information for people who live and work abroad. InterNations offers global and local networking and socializing, both online and face-to-face. At around 6,000 events and activities per month, expatriates have the opportunity to meet other global minds. Online services include discussion forums and helpful articles with personal expat experiences, tips, and information about life abroad. Membership is by approval only to ensure we remain a community of trust. InterNations is part of the New Work SE, a group of brands that offer products and services for a better working life. www.internations.org/press
DIRECTORY
INTERNATIONAL HR CONSULTANTS DELOITTE LLP
Stonecutter Court, 1 Stonecutter Street, London, EC4A 4TR Contact: Danny Taggart Telephone: +44 (0) 20 7007 1832 Fax: +44 (0) 20 7007 1060 E-mail: dtaggart@deloitte.co.uk Website: www.deloitte.co.uk Whether you are creating your first international mobility programme for employees or addressing fundamental changes to an existing programme, our International Human Resources team can help. Deloitte provides consulting support that has an appreciation for each company’s size, background and unique cultural environment, aligning your international programme goals with corporate business strategies. Our consultants have developed deep expertise in many fields based on first hand experience with many of the world’s leading organisations: international assignment policy and process design, benchmarking, service delivery modelling, improving vendor management and helping our clients become more compliant and their administration more cost-effective.
Contact: Tad Zurlinden Telephone: +44 (0)1379 651 671 Fax: +44 (0)1379 641 940 Email: enquiries@arp-relocation.com Website: www.arp-relocation.com The ARP is the professional association for the relocation industry in the UK. The ARP’s activities include seminars throughout the year, an annual conference, the publication of an annual Directory of Members and a website, which is updated regularly.
THE EUROPEAN RELOCATION ASSOCIATION (EuRA)
9&10 Diss Business Centre, Dark Lane, Diss, Norfolk, IP21 4ND Telephone +44 (0)1379 651 671 Fax: +44(0)1379 641 940 E-mail: enquiries@eura-relocation.com Website: www.eura-relocation.com EuRA is an industry body for Relocation Professionals in both Europe and Worldwide. EuRa have launched The EuRA Quality Seal, the world’s first accreditation programme for relocation providers. This pioneering initiative provides a straight forward, cost effective audit to reflect your company’s excellence in providing relocation services.
RELOCATION
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SANTA FE RELOCATION SERVICES
ACS INTERNATIONAL SCHOOLS
Central Way, Park Royal, London, NW10 7XW Telephone: +44 (0)208 961 4141 Website: www.santaferelo.com Santa Fe Relocation Services is a global mobility company specialising in managing and delivering high-quality relocation services worldwide. We enable people and organisations to work, live and thrive around the world. With ‘enabling people and organisations’, we want to make it possible for people to be where they need or want to be - enabling people and organisations. Our core competence is relocation services that support corporations and their employees relocate and settle in a new country, assisting them with immigration, home and school, language and cultural training, managing property rentals, delivering domestic and international moving of household goods. We provide these services to a consistent high standard, locally and globally. A key aspect is being able to manage our service delivery through Santa Fe operations across six continents.
RELOCATION ASSOCIATIONS
ASSOCIATION OF RELOCATION PROFESSIONALS (ARP)
9&10 Diss Business Centre, Dark Lane, Diss, Norfolk, IP21 4ND
ACS International School Cobham Heywood, Portsmouth Road, Cobham, Surrey, KT11 1BL, England ACS International School Egham London Road (A30) Egham, Surrey, TW20 0HS, England
ACS International School Hillingdon Hillingdon Court, 108 Vine Lane Hillingdon, Middlesex UB10 0BE, England
over 50 nationalities and many in the school community have experienced the challenges of relocation. Along with well-established welcoming programs, families receive ongoing support as they cope with the practical and emotional aspects of their transition to life in the UK. Taught in small classes, students (ages 3–18) benefit from a balance of academics, arts, athletics, activities, and service leadership. Excellent exam results and oneto-one college counselling enable 97% of TASIS graduates to gain acceptance to their first- or second-choice university in the UK, the US, and worldwide.
SERVICED APARTMENTS THE ASSOCIATION OF SERVICED APARTMENT PROVIDERS (ASAP)
Suite 3, The Business Centre, Innsworth Tech Park, Innsworth Lane, Gloucestershire GL3 1DL Contact: ASAP Office Telephone: +44 (0)1452 730452 Email: admin@theasap.org.uk Website: www.theasap.org.uk Twitter: @ASAPThe LinkedIn: The Association of Serviced Apartment Providers ASAP is in the industry association representing, promoting and improving the serviced apartment sector. Our 124 members including serviced apartment operators and agents represent in excess of 25,000 serviced apartments in the UK, Europe, USA and Canada. When booking your serviced apartment, look for our Quality Accreditation kitemark which confirms the operator is fully compliant with all the core legal, health and safety practices and means you can book with confidence.
ACS International School Doha Al Oyoun Street, Al Gharrafa PO Box 200568, Doha, Qatar
TAXATION
Telephone: 01932 869 744 Email: cobhamadmissions@acs-schools.com Website: www.acs-schools.com Contact: Dean of Admissions ACS International Schools were founded in 1967 to serve international and local communities. The schools are non-sectarian and co-educational (day and boarding), enrolling students aged 2 to 18 years. The UK based schools have over 30 years’ experience of teaching the International Baccalaureate, and ACS Doha offers an international and American curriculum.
55 Baker Street, London, W1U 7EU Contact: Andrew Bailey Telephone: 020 7893 2946 Fax: 020 7893 2418 E-mail: andrew.bailey@bdo.co.uk Website: www.bdo.co.uk BDO LLP is the award-winning, UK Member Firm of BDO International, the world’s fifth largest accountancy network with more than 1500 offices in 162 countries. We have a partner-led approach, which delivers the highest quality of service by using short, functional chains of communication to aid decision-making. Clients benefit from our fresh thinking, constructive challenge and practical understanding of the issues they face. Developing strong, personal relationships with our clients is at the forefront of our service approach. Tax advice is just one of our award-winning services and our expatriate team give practical and direct advice, delivering solutions which suit your needs.
TASIS THE AMERICAN SCHOOL IN ENGLAND
Coldharbour Lane, Thorpe, Surrey TW20 8TE Contact: Sarah Travis Telephone: 01932 582316 Email: ukadmissions@tasisengland.org Website www.tasisengland.org TASIS England's diverse student body includes
BDO LLP
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GLOBAL TAX NETWORK LTD
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