International HR Adviser Winter 2012 issue

WINTER 2012

ISSUE 52

Price £10.00

International HR Adviser The Leading Magazine For International HR Professionals Worldwide

Features Include: Global Talent: The New Hero • Strategic Moves: The Global Mobility Island A New Host Location • Pensions Savings And Overseas Assignees Ten Things I Wish I'd Known About European Employment Law International Assignment Policies • HR Risks In Emerging Markets Advisory Panel for this issue:

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CONTENTS

In This Issue Page 2

Global Talent: The New Hero Nichole Esparon, Provisita

Page 5

Research: Strategic Moves – The Global Mobility Island Andrew Robb & Deepinder Lamba, Deloitte Global Mobility

Page 8

International Banking: Overseas Assignments And Foreign Exchange Richard Musty, Lloyds TSB International Private Bank

Page 10

Employment Law: Dismissing In Unfamiliar Places Juliet Carp, Speechly Bircham LLP

Page 13

New Locations: A New Host Location – And A Whole Host Of Questions Helen Squibb, HS Consultancy Services Ltd

Page 16

Health: Duty Of Care – Workplace Health And Safety For Your Global Travelling Workforce Dave White, Healix International

Page 18

Pensions: Pensions Savings And Overseas Assignees Stewart Allanson, Zurich Corporate Savings

Page 20

European Law: Ten Things I Wish I’d Known About European Employment Law Juliet Carp, Speechly Bircham LLP

Page 22

International Assignment Policies: The Best Policy For Your Company Andrew Bailey, BDO LLP

Page 24

Global Taxation Update Andrew Bailey, BDO LLP

Page 27

HR Risks In Emerging Markets Thuy Niven, Control Risks

Page 30

Managing Modern Mobility: The Future Of Modern Mobility Wendy Wilson and Claire Snowdon, FIGT UK

Page 33

Survey: 2012 Quality Of Living Worldwide City Rankings Survey Mercer

Page 38

Immigration: Is The UK Border Agency Increasingly Looking To Support Compliant Businesses?

Ian Robinson, Fragomen LLP

Page 40

Global Immigration Update Fragomen Global LLP

Page 46

Diary Dates

Page 47

Directory

International HR Adviser, PO Box 921, Sutton, SM1 2WB, United Kingdom Publisher • Helen Elliott +44 (0) 20 8661 0186 • Email: helen@internationalhradviser.com Publishing Director • Damian Porter +44 (0) 1737 551506 • Email: damian@internationalhradviser.com www.internationalhradviser.com In Loving Memory of Assunta Mondello While every effort has been made to ensure accuracy of information contained in this issue of “International HR Adviser”, the publishers and Directors of Inkspell Ltd cannot accept responsibility for errors or omissions.

Neither the publishers of “International HR Adviser” nor any third parties who provide information for “Expatriate Adviser” magazine, shall have any responsibility for or be liable in respect of the content or the accuracy of the information so provided, or for any errors or omissions therein. “International HR Adviser” does not endorse any products, services or company listings featured in this issue.

Cover Design by Chris Duggan

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Global Talent

The New Hero The shortage of skilled employees sweeping international business is often described as a war for the best available talent. With tension growing by the day, HR is slowly emerging as the unlikely war hero.

The World Economic Forum, held in Davos each year, is usually a good indication of the global business agenda. The 2012 summit gave the clearest signal yet that talent shortages are the number one priority for CEO’s across the globe.

Professor Klaus Schwab, WEF founder and Professor of Global Economics’ reiterated the fact that to drive growth, companies must be effective at mobilising their talent. “Getting the talent question right,” he says, “will be pivotal for economic recovery and growth around the world.” Perhaps more profound still was his statement that we are no longer in a world dominated by capitalism but by ‘talentism,’.

The Professor’s words have been reverberating in boardrooms across the globe.

A flood of research over the past year has confirmed talent mobility as the 'hottest topic for global leaders'. One of the most significant perhaps was PWC’s annual CEO Survey which reported global talent management as the top priority for 97% of respondents.

When releasing their research, ‘Talent Mobility Good Practice to Stimulate Economic Growth’ 2012 earlier this year, Mercer announced that, other than losing the very customers that business is set up to serve, lack of talent is the single biggest risk business faces over the next decade.

The current focus on talent shortage as well as the need to mobilise talent has catapulted the HR and global mobility functions into the business and political limelight in an unprecedented way.

A Global Talent Imbalance A number of reports over the past year have also raised alarms regarding the serious talent imbalances present across the globe. While many countries face a deluge of unemployed graduates and a highly creative workforce who simply cannot find gainful employment, the other side of the globe’s already shallow pool of talent continues depleting by the day.

The World Economic Global Agenda Council on Skills and Global Mobility suggests that a more collaborative approach International HR Adviser Winter

is needed. Professor Yoko Ishikura, a member of the Council, points out that we live in a complex business environment where global competition is inter-related.

“An exchange of ideas and best practice needs to take place between companies, governments and academic institutions if we are to tackle these issues head on,” she says.

Yet such measures take time and the sheer urgency of the global talent situation dictates that we simply don’t have it.

Long-term strategies must necessarily be balanced by short-term measures if companies are to survive the deepening crisis.

The Tata Group’s response to the threats posed by the global talent shortage provides an excellent example of this delicate balance between long and short-term strategies in practice.

Founded in 1868, the Tata Group operates over 90 businesses and employs over 400,000 people across more than 80 geographical territories. While the executive management have been keen to keep each of these operations autonomous, the HR policy is dictated by the Group which provides a pool of resources that each company can tap into as and when it is needed.

Satish Pradhan, EVP of Human Resources for the Group, explained the theory behind this strategy at a recent Economist Intelligence Unit Talent Management Summit in London. “We need to be developing more managers ahead of our need for them. Together with judicious external hires, we can build a bench of talent ahead of the demand we will have.”

Another short-term measure many companies are attempting to implement is to make relocation packages more ‘fit for purpose.’ With budgets trimmed, companies are having to be super creative in designing engaging solutions to motivate key talent – and their families – into accepting international assignments to fill critical skills gaps.

Relocation challenges increasing the pressure on employers The inability of the family unit to adapt to the host location and poor spousal engagement in the relocation process has long been recognised as barriers to relocation.

According to the Ernst & Young ‘Global Mobility Effectiveness Survey’, released in November 2012: “Personal, rather than

professional issues continue to be by far the most significant factor in failed assignments and dissatisfied employees.”

The complexities surrounding dual careers are also clear impediments to relocation. The Permits Foundation reported in their ‘International Mobility and Dual Careers Survey 2012’ that 51% of their 177 respondents had experienced refusals to accept international assignments over the previous 12 months due to this issue.

A further 27% had not evaluated reasons for refusals – indicating that this figure could be significantly higher. The study also found 25% of CEO’s had been forced to abandon or delay significant market opportunities due to concerns over dual careers.

Where companies do manage to deploy their talent, the risks are equally treacherous. Ernst & Young’s survey (mentioned previously) reported that more than 1 in 12 companies over the past year had experienced at least 11% of assignees returning before the completion of their assignments – at huge cost. Even where assignees return at the designated time, a further 20% will leave within a year of repatriation if they have had a bad relocation experience.

Companies must find strategies to retain employee engagement throughout the entire life of the assignment, or face their talent walking out of the door in favour of a string of competitors with arms wide open to accept them. Recent slashing of staffing numbers in response to the economic conditions has resulted, according to critics, in something of a ‘watch out for number one’ culture and ensuing lack of loyalty among employees – increasing the chances of the best talent being poached.

Clearly then, with Global Mobility taking such an active role in enabling companies to tap global market opportunities, there is an urgent need to understand employee motivations in the context of international assignments.

Understanding employee value propositions for assignment success Employees and employers often have very different views as to what constitutes a good relocation package. Carol Stubbings, Partner and International Assignment Services Lead for PWC, recently relayed a great example of how companies now need to

Global Talent think a little more creatively in terms of the benefits packages they offer to engage – and retain – talent in the relocation process.

Speaking via video on the PWC website, Carol described a company which had tried without success to attract assignees to undertake an important project in Central Africa. They received not a single application. A little ‘outside-the-box’ thinking by an astute team member led to the creation of a programme where, for one day a week, assignees could help build schools, volunteer their time at the local hospital – anything they liked to assist their local community. On announcement of the programme, the assignments were oversubscribed by 250%.

For many employees today, and particularly among ‘Millenials,’ the satisfaction of engaging with their local community provides the kind of personal growth that represents the very reason they value assignments at all.

Similarly, the tensions surrounding dual careers and spousal dissatisfaction can often be eased if measures are put into place to assist accompanying partners to maximise their own opportunities and re-create independent identities in the host location.

It is important to remember, says the Permits Foundation, that these are real people, with real needs and companies ignore this at their peril.

A Round-Table event held by Provisita in December focusing on the needs of accommodating partners on relocation discovered a debilitating lack of communication in the relocation process. A number of HR Directors pointed out, for example, that they are mainly not aware of the issues faced by assignees’ families. Those on a leadership trajectory are loathe to complain about their partner facing a difficult emotional challenge for fear of looking like they cannot cope. In much the same way, C-suite Executives are often unaware of the issues – and the risks – faced by HR in this very delicate, but critical area of responsibility that has the potential to impact heavily on overall business objectives.

With such critical challenges facing the HR and Global Mobility functions, it is not surprising that there is increasingly a call for HR objectives to be more greatly aligned with business needs.

Talent management no longer just the remit of HR Given the criticality of global talent shortages, it is still surprisingly rare to find corporate leaders placing the talent

management agenda as a company-wide, rather than a strictly HR, agenda.

A study released by Deloitte in November 2012 highlighted a number of improvements necessary to promote successful talent mobility within multi-national organisations. From a sample of almost 200 HR and global mobility professionals across a number of geographical territories, only 2% found their processes and procedures to be ‘world class.’ In fact 70% of those surveyed reported an urgent need to improve processes and that their organisations are underperforming in this respect.

Rob Hodkinson, Global Mobility Transformation Practice Leader at Deloitte, says CEO’s are fully aware of the potential for HR and Global Mobility teams to work more strategically within the organisation to support its chief objectives – tapping opportunities in emerging markets (100%), increasing globalisation (99%) and dealing with increases in competition (98%). Yet less than 30% were found to be actually engaging sufficiently with these functions to address these issues.

One company who has successfully aligned talent management strategy with the overall objectives of the business is US firm KimberleyClark, recently ranked no. 4 in the 2012 list of ‘World’s 25 best multinational workplaces.’

Liz Gottung, Senior Vice President and Chief HR Officer for K i m b e r l e y - C l a rk , indicates that to be recognised as a strategic function in the business takes a two way communication.

It is not enough, she says, to wait until the CEO recognises this need. Instead, it is up to HR to push the agenda higher up the corporate priorities list.

It is doubtful whether the role of HR will ever be able to revert to its’ former ‘back office’ image.

Talent management has taken on the role of corporate hero – offering a unique

opportunity to effect changes that in some cases can quite literally ‘save the ranch.’

As an inherent part of the strategic business function, they are in the right place at the right time to speak up for the changes they wish to see – for themselves and for the talent they manage.

“HR must never forget that they are also in sales,” says Gottung. “They are selling ideas to fellow senior leaders.”

Nichole is cofounder & Chief Executive of Provisita. The company assists employers to stem financial losses and increase key employee retention by facilitating social and professional integration into the host city for relocating employees.

Provisita’s services are designed so as to also minimise settling-in times for assignees and reduce discomfort for any accompanying partners.

Nichole Esparon, Chief Executive, Provisita T: +44 (0)20 7129 1438 E: nesparon@provisita.com W: www.provisita.com Twitter: @provisita

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Strategic Moves: The Global Mobility Island Global mobility: alive and well, but marooned. An increasingly globalised world needs a global, mobile workforce. Few business leaders would disagree in principle. Most are happy to go beyond principle: They readily identify emerging markets and the need for global mobility as priorities for their own organisations. But knowledge is not action. In the latest Deloitte annual survey of almost 200 HR, talent and global mobility professionals from companies around the world entitled ‘Strategic Moves’, the same responses that reveal a keen awareness of global mobility issues also show little movement to address those needs. Where organisations are taking steps, they appear to be aligning their global mobility strategies with functional needs, not with key business priorities. And they are not using global mobility to help develop the next leadership generation.

It is as if business is sailing on towards a global future, having left global mobility strategy behind on an island of its own.

Organisations that fit this description risk finding themselves awash with new opportunities they don’t have the workforces to exploit. This is because business isn’t the only thing going global. Talent is as well. We are now operating in an open talent economy. Today, talent moves easily to and through the boundaries that used to demark organisations and even nations.

People are the CEOs of their own careers, and long-term employment – even formal employment of any duration – has less hold on them than ever before. The continuing disconnect between thinking and action on global mobility shows organisations are still at sea when it comes to embracing the open talent economy.

They have a sense of what must happen but not a plan for making it happen.

Can global mobility start to close the gap? Organisations recognise global mobility as a tool to support the most top strategic business issues, namely emerging geographical markets, increasing globalisation and increasing competition. However, only a small percentage are using mobility fully to address those issues.

Global mobility is still behind the curve when it comes to driving business results.

Seventy percent of business and HR stakeholders say global mobility in their organisation is underperforming or needs improvement, some of it significantly.

This highlights opportunities for the business and global mobility teams to deepen ties with each other which may start to be happening now. Nearly 40 percent of organisations say they are currently reviewing, or are about to review their overall global mobility strategies, including alignment with business issues and goals. In practical terms, alignment requires business leads or HR business partners to involve global mobility at strategy table discussions where business issues are addressed, so global mobility can articulate the value assignments may bring. It also requires global mobility to engage regularly with the business, directly or via HR business partners, to provide statistics and challenges aligned to top business issues. Mobility leaders must also keep abreast of changing business drivers that may affect the way they structure their programmes and deliver services. One particular finding from the survey sheds insight into why strategists embrace the idea of global mobility even as the organisations they lead appear to lag in implementing it. Respondents in different roles were asked whether they felt global mobility was a purely administrative function, a strategic value-adder, or both. Respondents in business HR roles were most likely to see it as purely strategic (42 percent). But in a mirror-image outcome, those tasked with high-level talent and reward responsibilities – the people with the power to elevate global mobility to the realm of grand strategy – were most likely to see it as purely administrative (42 percent).

Taking a closer look at this disconnect, of those organisations who rate talent as critically important, the majority do not rate themselves as world class in the use of global mobility practices for talent purposes. Echoing the results from the 2011 survey, this suggests there is still a large gap between where organisations are now and where they want to be in terms of global mobility. The majority of organisations surveyed are well aware of the current limitations of their global mobility

programmes from a practical as well as a strategic standpoint, but they are not translating that awareness into initiative: Only 2 percent see themselves as worldclass and only 12 percent report that they perform clear assessment of their mobility practices and link those assessments to improvement efforts.The vast majority of organisations surveyed (88 percent) are undertaking only a limited assessment of their mobility practices.

This is a surprising result given the amount spent on international assignments each year. Global mobility and HR leaders should ask themselves: Would other HR areas, such as reward, learning and development, or talent management, receive similar neglect if they were found wanting? By failing to assess and measure global mobility practices in a planned and regular manner, organisations are missing the chance to fully understand their difficulties and learn how to overcome them.

You cannot strengthen an ability if you won’t even measure the ways it’s deficient.

Overall, this indicates a lack of clarity amongst organisations in determining which improvement initiatives they should use to ensure their programmes are meeting their strategic objectives. Where companies are undertaking improvement activities, the main focus appears to be on policy and process review and redesign.

When asked however, about what initiatives should be undertaken in the next 12 months there was no consistent response or understanding of which improvement areas should be prioritised. This is another symptom of the disconnect between a stated desire for strong mobility programmes and the failure to make them a reality.

What is the way forward in the shortterm? In order to align global mobility to business and talent strategies, companies need to define what they want to achieve, make a regular assessment of whether they are achieving it, analyse the gap, and make plans to close it. Based on the survey results, it is clear the majority of organisations that responded to the survey are not doing this.

In summary, organisations need to: 1) Agree upon the strategic purpose of global mobility within their organisation and define what great looks like to all key Winter International HR Adviser

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Research

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research stakeholders. Once this has been established, the appropriate strategy can be agreed upon and improvement roadmaps developed.

This may require better integration of various technology systems, processes, polices, vendor capabilities, and overall use of data analytics amongst other initiatives.

2) Understand the value proposition of global deployments: Take time to look at who they are sending on assignments and why and how this fits in with the individual business units growth and talent plans. This will involve the use of appropriate candidate selection, assignment justification, and assignment approval processes. There may be alternatives to mobility in many cases such as through talent acquisition and talent retention strategies. Likewise, assignment extension, early repatriation, and assignment failure should be investigated to see to it that assignment costs are not being wasted.

3) Enhance the use of mobility data analytics. Not only report on cost, but look at it alongside other metrics. If total assignment costs go up slightly but all strategic KPIs are being met, then the additional investment is likely to be worthwhile to the organisation. Likewise cost reductions should not be made if they will lead to missed KPIs in other areas.

What is the way forward in the future? Whilst focusing on these initiatives in the short-term will start to close this gap, it also highlights the longer-term challenge that global mobility is still missing one key element in its scope of services: an overlaying ability to develop strategic initiatives (or ‘propositions’) in alignment with specific business priorities. These propositions respond to critical long-term strategic organisational capabilities such as M&A activity, change acceleration, culture change, talent gaps, and growth. Given the business challenges, leading global organisations face this new area of strategic focus should be in the area of global workforce management – the strategic management of an organisation’s global supply and demand of skills and talent. This will require the creation of new capabilities within global mobility to drive global workforce planning improvements across the entire organisation.

If global mobility is ever to truly meet the needs of the business, it needs to move away from traditional, functionally aligned roles to business-aligned roles that can support the projects and programmes that the business is focused on. With alignment on solutions for business challenges like global workforce management, the mobility teams and centres

of expertise can finally close the gap and align with the business by solving their most critical business issues. This does not mean the end of traditional mobility teams and centres of expertise, but it does require organisations to rethink the way they provide support for both functional and business focused needs and supplement these functions and roles with new global workforce management capabilities. This will also require investment both in wider functional capabilities such as global standard reporting and HR technologies, together with the ambition to invest ahead of the talent demand curve to create the required supply of talent.

Positioned appropriately, by adding global workforce management capabilities to their suite of services, global mobility can be the key player in solving an organisation’s long-term skill supply-and- demand talent gaps. There is tangible value to be realised, but it will likely take a departure from the current model and a strong vision of the future in order for organisations to truly align mobility and talent with their wider business and talent strategies.

To read the full report please visit www. deloitte.com/strategicmoves Andrew Robb Deloitte Global Mobility Transformation Director Andrew leads Deloitte’s Global Mobility Transformation (GMT) practice in the United Kingdom. He has extensive experience in leading large mobility transformation projects. He speaks regularly at seminars across the globe and has published a number of articles discussing global mobility transformation. He can be contacted at anrobb@deloitte.co.uk.

Deepinder Lamba Deloitte Global Mobility Transformation Senior Manager Deepinder helps clients achieve their objectives by managing programmes and projects in the area of Benchmarking, Operating & Service Delivery Model Design, Process Transformation, Change Enablement, Technology Implementation and Service Transitions. He can be contacted at: dlamba@deloitte.co.uk.

FREE SEMINAR Payroll Compliance For Mobile Employees As the pressure on internal and external compliance gets greater, the challenges of reporting compensation data for international assignees, in particular relocation expenses and third party vendor expenses, get no easier. Data is invariable embedded in multiple data sources, often in different locations. At the seminar we will discuss what the reporting requirements are, what challenges are faced by organisations and explain some of the ways in which companies are deploying global processes to collect and report relocation expenses and third party vendor expenses.

Presented by Deloitte LLP. This seminar is taking place on Monday 4th February 2012 at The 2013 Corporate Relocation Conference & Exhibition, Hotel Russell, Russell Square, Bloomsbury, London.

To register your free place in this seminar please email helen@internationahradviser.com

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International Banking

Overseas Assignments And Foreign Exchange For any employees embarking on overseas assignments, whilst it can be exciting, it brings with it the need to plan ahead. There are many things for them to consider; as well as the practical arrangements to be made from finding a new home, learning a new language, to securing a place at a good school for those with children. Ahead of moving, one of the most important factors for them to consider is ensuring their finances are in order.

One of the biggest challenges and considerations for international assignees is how their finances are managed and their exposure to currency fluctuations are mitigated against. Many international assignees are paid in Sterling, so whilst they may have a local account in any given currency - these fluctuations could drastically impact not only on their day-to-day spending but also any savings and investments they have.

A trusted international bank with established offshore banking facilities can offer them the bank account they need, giving them flexibility as well as peace of mind. Multi-currency accounts give the ability to bank in multiple currencies; typically offered in Sterling, Euro and US Dollars. Whilst the money is kept in the currency it is deposited in, it can be converted into another currency as and when needed. This model gives the assignee greater control and flexibility over how their money is converted.

Money transfers are obviously affected by currency fluctuations, but it is possible for employees to negotiate a fixed cost for them, meaning they won’t be as adversely affected by any sudden changes. Of course expats may also benefit from currency movement; however the key point to remember is that they do present a potential risk to their overall spending power. By shifting money into the currency that best meets their daily needs, they are able to better manage the overall financial risk exposure they face, thereby reducing the impact on the valuation of their money.

For example, assignees working in the Eurozone who are being paid in Sterling, might want to consider transferring a portion of their spending money into Euros International HR Adviser Winter

as soon as they are paid each month. In doing so, this would reduce the impact currency fluctuations can have on their day-to-day spending power.

Transferring money internationally between accounts can prove costly.

Recent research* released by Lloyds TSB International revealed that international assignees waste an average of £15 in fees per money transfer. Furthermore, the Bank’s research reveals some 38 per cent don’t even know how much they are charged in fees. Given expats often have to transfer money frequently to and from the UK, these transfer fees can quickly add up to a rather big annual cost. Therefore by going with a provider that charges no fees, expats can save hundreds of pounds a year.

Pensions are also an important consideration and can involve sifting through a wide number of options available to choose the right one. Finding the best pension will vary on a case by case basis and very much depends on individual concerns, needs and circumstances. If assignees are considering leaving their pension in the UK it’s important that they understand the potential effect of currency fluctuations. If the move is permanent, transferring their entire pension pot into the new currency of expenditure may be a better long term solution. A range of international pension arrangements offer such flexibility.

In all cases we would urge assignees to take professional financial advice.

Another important area for international assignees to consider is their tax status. Becoming a resident in one country while still having financial commitments back in the UK can cause complications to assignees’ tax status. It’s more common than not that people pay tax twice for a period of time, both in the UK and in their new country of residence.

However, to avoid this issue, the UK has “double tax agreements” in place with a large number of countries. These double tax agreements exist for many of the most popular places to emigrate such as Australia, Canada, France, Italy, New Zealand, Spain and the United States.

Employees can find more information and guidance about these agreements on

the HMRC website: http://www.hmrc. gov.uk/cnr/app_dtt.htm Moving abroad is a tremendously exciting time for many assignees and can open up a whole new range of career opportunities and life experiences. Given adequate preparation, the process of moving abroad can run quite smoothly. It’s important to ensure financial matters form a central part of their pre-move preparation, and with guidance on the matters discussed above, expats will find it far easier to get their finances in order prior to their move. * From a survey of 1,030 British expats based in the 10 most popular expat destinations. Conducted by Freshminds, the research uses a sample of expats from each country that is representative of the global spread of British expats.

The survey was conducted online in April 2012. The countries involved are: Australia, Spain, USA, Canada, France, New Zealand, South Africa, Germany, UAE and Hong Kong.

Richard Musty, Lloyds TSB International Private Bank Director. The Bank provides financial guidance and services to globally mobile employees: www. lloyds-tsb-offshore.com/employeebanking.

Lloyds TSB International’s Global Mobility Banking has introduced a new guidance service for HR professionals, multinationals and relocation agents who are responsible for sending employees on an overseas assignment.

The bespoke workshops are designed to ensure international assignees have a smooth transition to living, working and travelling worldwide and will cover a wide range of global mobility related topics including taxation, immigration, education, banking and cultural awareness.

If you would like to register your interest in attending a free expatriate seminar with Lloyds TSB International, please email their events team at eventsteam@lloydsbank.ch.

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Employment Law

Dismissing In Unfamiliar Places In this article Juliet Carp, Employment Partner at solicitors Speechly Bircham LLP, offers some practical tips for employers preparing to dismiss an employee in an unfamiliar jurisdiction.

In many ways dismissal is similar across the world. For example, individual contract terms are likely to be important; most countries apply minimum notice periods, have laws allowing claims on dismissal, discrimination etc., and many offer tax relief on termination payments. Most importantly, human reactions appear to be remarkably consistent across the globe. It is the detail though that can catch us out and which often leads to unnecessary expense and so a bit more enquiry and preparation will be needed if the dismissal will be implemented in an unfamiliar territory.

This article focuses on the dismissal of individual “local hires” rather than on “expatriates” or collective redundancies (tactics and processes would normally be different for expatriates or where a significant number of employees are to be dismissed).

Preparation Before planning begins, make sure everyone understands that decisions made and documents created at this stage could have a bearing on the outcome of settlement negotiations and/or litigation. Make sure you understand whether “legal privilege” may protect correspondence and, if in doubt, play safe and avoid careless emails. Bear in mind too that privilege rules vary substantially between jurisdictions, for example, sometimes those rules do not protect correspondence with in-house counsel.

It is worth spending time seeking clarity on the reasons for the proposed dismissal, business impact, other options etc. This will usually be relevant to the claims that might be made and, in some countries, may make a difference to whether dismissal is possible at all. So, for example, a redundancy may be relatively straightforward to implement, but dismissal for poor performance may not be possible unless there is concrete evidence and a lengthy documented procedure is followed first. The reasons for termination may have an impact on potential compensation as well as process. For example, a “redundancy” payment from an insurance fund may not be available to a poor performer and different financial “caps” International HR Adviser Winter

might apply to different types of claim.

You will need to gather together relevant documents, for example a copy of the employment contract; any related documents e.g. pay review or appraisal letters; payslips; appraisal documents; details of any appointments etc. If a collective agreement may apply information to enable a local lawyer to determine which agreement is applicable will be helpful (see article p20).

Seeking local advice Choose your lawyer carefully and your words. Avoid terms that may be misinterpreted such as “redundancy”, “indemnity” etc., and, where possible, set out concrete facts so that the lawyer can make an accurate assessment of the problem and options open to the business. Make sure the team understand the importance of waiting for that advice before making decisions. Highlight any special circumstances e.g. pregnancy, disability or sickness; status as an employee representative; immigration clearance dependent on employment; or earlier allegations of discrimination or whistleblowing. Things you may want to understand could include for example: • Any laws prohibiting dismissal of that person or for that reason • Whether an applicable collective agreement sets out requirements relating to termination • Who the appropriate person/people will be to make decisions • Whether there is a need to seek approval from, or consult with, any employee representatives, governmental body or court before or after dismissal or in relation to severance terms • Rules relating to notice (e.g. whether thre is a minimum or maximum period and the priority applied between laws, collective agreement, contract etc.) and garden leave (which may not always be possible) • Whether special payments must be made and whether those payments must come out of public funds or the employer’s funds, e.g. redundancy payments or end of service gratuities • How termination payments must be calculated (the adviser will probably need details of holiday and gross and net cash payments e.g. salary and bonus)

• Impact on benefits e.g. whether the employee must be given an opportunity to continue private medical insurance • Whether there is any scope for saving tax or social security contributions • What sort of claims the employees may make, and potential costs and tactics for mitigating any risks • Guidance regarding the appropriate process, timing and the consequences of taking any preferred shortcuts • Whether any steps need to be taken in relation to restrictive covenants (e.g. release to save costs or affirmation or agreement of new terms) • Any rules on priority rehire.

Both specific and open questions will usually be needed in order to drill down to the level of detail you need. For example, how many meetings must take place before a decision can be taken, who should attend, what should be discussed etc., how must notice be delivered (by registered post, in person, courier etc.)?

Don’t forget that the lawyer may not offer advice on some related practical matters unless you ask for it directly. Things that local employers may not need to be told may not be obvious to you. (E.g. how will termination payments be delivered, what to do about keys, return of mobile phone, computers etc.).

It is worth repeating that it is important that questioning is detailed here as some critical steps may not become apparent until you ask. For example, if the termination letter is to be signed by someone who is not the right official signatory or who is not physically in the right country then a power of attorney, copies of company documents and/or an Apostille may be required to make the notice effective.

Don’t forget to ask for specific advice relating to removal from any appointments or removal of any powers of attorney, and do consider practical consequences. E.g. the need to appoint another director to meet the minimum number requirements or to ensure that someone else is able to sign cheques, conclude commercial contracts etc. Board meetings may be needed and formal decisions may need to be documented, usually after any consultation process is concluded.

Special considerations will apply if the most senior person in a particular country will be dismissed.

Employment Law Negotiating tactics Before the first discussions begin you will need to understand what it is that you can achieve, what you want, what you can give away, whether there will be negotiation and if so, who should have the discussions etc. The bases to be covered are likely to be very similar to those that are relevant in the UK, though the process may operate differently in practice and it is important to pay attention to the cultural context.

Severance agreements If a severance agreement may be needed it may be appropriate to have a draft ready.

Usually the format will be similar to the format used in the UK but there may be some special requirements/adaptations to be made. For example, there may be strict rules regarding signatories, approvals, place of signature, counterparts, whether the employee must be advised, cooling off periods, wording to prevent future claims etc.

Litigation In most cases litigation is likely to be a worry rather than a reality, but you may wish to get a feel for potential practical and financial

consequences and the level of risk. You may wish to take steps to ensure that practical arrangements for dealing with any claim are in place. E.g. how is the employer likely to be notified of a claim? Will lawyers require formal authority to manage any claim that is made and will this take time to organise?

When will time limits expire?

Making it easier next time There are some practical things that can be done to help make things easier, the most important of which is to make sure that termination costs etc., are understood at an early stage. There may, for example, be scope for managing these costs (or at least setting expectations) before hire, a promotion is made or new contract is negotiated, or a business is purchased. These are also good opportunities for checking that documents are available and up-to-date.

Allowing adequate time for planning can make a difference. For example, there is likely to be more opportunity to control cost, minimise the risk of claims etc., if plenty of warning of a potential dismissal is given. A lot of time for planning is not always practical but typically dismissing in

another jurisdiction will take much more work and more time and if things are too rushed mistakes are more likely to be made.

Last, but definitely not least, HR practitioners will probably agree that paying attention to personalities and treating people properly can make a huge difference to co-operation and financial outcome. An employee who understands that his role is genuinely redundant and knows that his employer has tried to help will be less likely to make a claim than an employee who is told he is no good at his job or given no explanation at all.

Juliet Carp Partner, Speechly Bircham LLP. Juliet specialises in UK and international employment law and advises on all aspects of UK employment law. juliet.carp@speechlys.com +44 (0)20 7427 6412 www.speechlys.com

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You are cordially invited to

The 2013

Corporate Relocation Conference & Exhibition on

Monday 4th February 2013 10.00am - 5.00pm at

Hotel Russell, 1-8 Russell Square, Bloomsbury, London, WC1B 5BE

This event is FREE TO ATTEND

Come along and meet our 42 exhibitors who have products and services that support International HR professionals and those advising the expatriate community.

There are also free seminars running throughout the day and these are listed on the enclosed invitation and on page 39. They are also publicised on www.internationalhradviser.com. You will need to pre-register for the seminars as places are limited so please email helen@internationalhradviser.com If you would like complimentary invitations for your colleagues, please email helen@internationalhradviser.com with the quantity and where you would like them sent to.

For further information on this event please call Helen Elliott on 020 8661 0186.

We look forward to seeing you then.

New Locations

A New Host Location – And A Whole Host Of Questions Globalisation continues apace and with it the Global Mobility Manager’s task of ensuring they become specialists for each and every new location. Much is publicised and discussed about emerging markets (with the “BRIC” locations dominating the headlines and watch this space for “CIVETS”, the next grouping of emerging countries), but an “established” location can be just as challenging when you are sending assignees there for the first time.

Let’s face it, it’s unfeasible for a GM Manager to be knowledgeable about all locations in advance of landing there, so they will need to first plan, then pose a series of questions to the right people and organisations to research and uncover the key issues.

So what are these fundamental questions that GM professionals need to determine prior to sending an assignee to a new host location? Firstly an understanding from the business on the “type” of assignee likely to be sent and the approximate numbers; the length of time they will need to be there; their likely roles and duties and what corporate structure is in place in Location X to facilitate these moves. Once there is an understanding of the likely assignee demographic the GM Manager can research the areas discussed below. In reality, these will not be distinct or stand-alone categories, but will overlap to provide a cohesive plan necessary to meet the upcoming challenges.

What is the Corporate Structure?

One of the most important factors to determine up-front is the type of business structure which exists in Location X. This may be a new country for the organisation as a whole and in such cases a subsidiary or branch may not be established or even warranted at present. For example, an organisation may determine that a representative office or agent is applicable in the early developmental stages, where non-transactional operations (such as marketing) are initially required. Likewise the assignee may be destined for a joint venture or client’s organisation.

Dependent upon the location, such a structure may not be entitled to sponsor

or hire a foreign national. Even if there are no immigration limitations, depending upon the seniority and authority of any proposed assignee attached to a rep office or agent – their very existence may form a permanent establishment in Location X, which in turn may mean the company becomes liable for corporation tax in that jurisdiction.

It is critical, therefore, that from the outset the GM Manager works closely with Corporate Tax and Legal to realise the corporate structure and any limitations it may pose, both in terms of employment, immigration and tax.

What Employment Legislation will be applicable?

The adage that the GM Manager needs to know “a little about a lot” holds particularly true when exploring a new country and building the necessary knowledge base – uncovering issues that will affect policy and practice and determining when to bring in more detailed, professional advice. Location X will offer a whole new set of employment legislation challenges, a rudimentary grasp of which will be important in the development of a new location plan.

Whilst an assignee may remain covered by their home terms and conditions and seconded to the new company, local employment law in Location X may still trump all other laws. An employment contract may be a necessity, even for seconded staff – sometimes to comply with employment legislation, others times just to secure a visa. Employment legislation such as working time directives, statutory benefits and collective labour laws may also be valid for assignees working in Location X. Collective bargaining agreements in some countries may lead to additional terms and conditions (extra holiday for example) applicable for all staff on site.

If there is an established subsidiary in the location the GM manager may be able to tap into that HR expertise (albeit they may not have experience with foreign nationals and/or seconded employees), as well as seeking professional legal advice on the finite details. Such due diligent investigations ensures that both the organisation

and individual are covered and minimises the risk of litigation issues arising in the future.

What are the Immigration and Residency rules?

In simple terms – all the diligent investigations and policy development in the world will come to nothing if you can’t get the employee into the country. To uncover all the immigration variables for Location X the GM Manager will once again need to pose a series of relevant questions.

Firstly, they will need to assess internally: to understand the likely assignee demographic; the anticipated timeframe (e.g. start date and assignment length) and the approximate number of possible assignees. Armed with this basic outline they can research the relevant host country immigration options, ensuring they understand issues such as: time restrictions on visas; whether a visa limits the type of duties that can be undertaken; whether an employee has to have been employed for a certain period by the company or hold relevant qualifications; whether the visa option has a quota – and whether that quota has already been reached?

Dependents - their ability to accompany the employee and even work in the new host - remains high on the agenda for both individuals and organisations.

Whilst a company may acknowledge same sex or unmarried couples through their global mobility policy and home country benefits programmes, Location X may fail to recognise these as valid partnerships for immigration, causing entry issues.

In addition, securing a visa or permit for your employee doesn’t necessarily entitle their spouse or partner the right to work.

Unfortunately the GM Manager doesn’t have a crystal ball and can never accurately forecast the organisation’s decisions two years hence. However, if it’s possible to pre-empt as many future intentions as possible and secure the appropriate immigration “vehicle” then in the longterm this should provide options for the employee and company.

What Policy and Practical issues need defining?

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New Locations Entry into any new location offers the GM professional the opportunity to review the tenets of the existing policy, whilst also investigating any specific practical issues which may need addressing. Hopefully the basic principles of the policy strategy will hold true, however elements such as compensation (e.g. home or host packages) and assignment benefits (e.g. accommodation and medical cover) may require review. In such cases many GM Managers develop specific country or city addendums to meet the variances, thereby not diluting the policy principles, but ensuring the location specifics are met.

Evaluating common assignment benefits will often require both external and local advice, for example, accommodation will always be an essential element for the assignee and knowledge of the new rental market will be necessary for the GM Manager. Whilst data specialists can provide the appropriate allowance scales, relocation agents will have their finger on the market’s pulse and be able to offer the ‘real-life’ situation – critical when you need to secure accommodation as soon as possible once the assignee has arrived. Perhaps the GM Manager may find that in Location X Landlords will only accept rental payments in a hard currency; or they will only accept a year’s rental amount up front; or that they won’t accept rental contracts in Company names. In Location X the term “unfurnished” may mean no white goods or even no kitchen fixtures or fittings. None of the above issues are insurmountable, but prior knowledge enables the GM Manager to provide the appropriate support, or craft relevant allowances.

For those employees with accompanying children another issue close to their heart will be education. Having an understanding of the state schooling system, as well as the international school options available, will assist in pre-assignment briefings with potential assignees.

In discussions with experts, or through their networking contacts, the GM Manager may discover that most assignees utilise the state system (rather than the usual expectation that private education will be applicable). They may find that where the state system isn’t appropriate - Location X has very limited places at international schools, or long waiting lists, or even no international schooling option at all. In such circumstances there may be little the organisation can do but counsel the employee up front so they can make International HR Adviser Winter

an informed family decision. No amount of money can create an appropriate school place if none exists, but understanding and informing employees on the options available enables them to review these against their own personal circumstances.

Another highly valued assignment benefit is the medical cover provided to assignees and their families. Here the GM Manager may be able to obtain information from internal specialists who manage existing healthcare cover, or from external specialists primed to the new location. Location X may offer excellent state healthcare facilities – and it may necessitate a cultural change for prospective assignees, getting them to accept and use state healthcare when they have previously gone private.

Expectations and level of cover may well differ between home and the new host, many organisations will lay the emphasis on the individual to understand any differences in advance, whilst ensuring that basic levels continued to be covered.

The list of assignment benefits can go on, from cash-based allowances (such as Location premiums), to tangible benefits (such as company cars and expatriate club membership), through to benefits designed to meet particular locational needs (for example additional security cover or language training). Some may be existing policy elements which just need clarifying for Location X, others may be created specifically to address the findings from the Location X investigations.

Along with the determination of relevant policy benefits – the GM Manager will need to investigate and plan for the key practical issues that will arise, trying to ensure that the settling-in period is as smooth as possible and that any compliance risk (both to the organisation and individual) is minimised. Form filling or waiting in-line is the bane of most of our lives, but it’s unlikely that these elements can be ignored or put aside when entering a new location.

GM Mangers may find that in the new location the assignee will need (sometimes in person) to secure a relevant document, or ID number, or present themselves to authorities – in order to facilitate further services. For example, in Location X it may be necessary to secure an ID number before being able to open a bank account; register with healthcare services or even secure a rental lease. Whilst such bureaucratic administration can easily be dismissed as insignificant and scarcely strategic, any executive who has been

thwarted by red-tape on their arrival can tell you that understanding up-front what needs to be done will cut time-consuming inquiries, avoid annoying surprises and allow them to prioritise on arrival. Be prepared should not be just a motto for the Scouts, knowing what, how and when to tackle the formalities is half the battle.

Another practical and compliance process worthy of stringent scrutiny will be pay delivery – it goes without saying that assignees need money to live on and will want to access funds right from the word go! Clearly it’s a fundamental principle that the employee needs to be paid, but it is also critical that the company is compliant and manages any payroll withholding requirements in the new host location. In addition, it may be discovered that Location X necessitates a local salary (paid in local currency); or there are restrictions on the ability to take currency out of the country; or runs different payroll cycles (e.g. paying bi-weekly, or 13 times per year, or providing additional “month’s” salary before Christmas). Expert advice from external specialists can assist the GM Manager is determining what the issues are and then how to comply, even an established branch or subsidiary may never have experienced foreign workers joining their payroll.

What is the Tax and Social taxes position?

Lastly, and by no means least, with each new country there will be new tax and social taxes to manage. Despite harmonisation in many areas no two tax jurisdictions will be the same and with tax and social taxes playing such an important part within Global Mobility this area can be one of the key drivers in terms of assignment design and structure; compensation delivery and on-going compliance.

Once again, the GM Manager cannot be expected to be an expert in Location X’s tax rules and regulations, in fact even the tax specialist contacted in the Home location is likely to rely on the expert advice of their counterpart in Location X. As a starter, the internet will offer some easy and high level information on Location X, for example – it’s general income tax rates; tax year and any reciprocal agreements. Initial and broad outlines can be requested from tax experts, for example an understanding of the high level principles; income and corporate tax rates and obligations; effects of visa and residency; key filing and payment dates and the

New Locations social security structure. More specific information is likely to be driven by the individual employees, their packages, their home locations, and length of assignment.

Any opportunity to structure an assignment to maximise beneficial tax positions should be done up front. It’s not always applicable or practical for the “tax tail” to wag the “assignment dog”, but prior knowledge is power - and may enable planning opportunities which minimise tax costs. Location X may operate a regime or ruling beneficial to both employee and/ or an organisation. Understanding what opportunities (or obstacles) are out there enables the GM Manager to structure assignments efficiently, wherever possible.

A whole host of questions In essence, entry into a new location is a game of posing the right questions to the right bodies. The trouble is – you don’t know, what you don’t know! How does the GM manager uncover all the issues when they are not sure of the right questions to pose in the first place?

In an ideal world the GM Manager would be given ample time and opportunity to research a new location with the due diligence required to determine

all the issues and solutions. Realistically, often it’s a mad scramble to catch up with employees who have already landed and are already experiencing some of the difficulties and obstacles in their daily life.

Policy decisions made on the hoof in this way never offer the opportunity of thorough review or benchmarking and are often a knee-jerk reaction to a specific employee’s issue, which can set an unhelpful precedent.

Even with time, it is often difficult to uncover all of the issues because it’s difficult to pose a pertinent question to an issue you don’t know exists yet! To help manage issues, both before and on arrival, the GM Manager could build a checklist or guide to the usual and most obvious questions under the headings above, which will help tease out the nuances of the new location. The ability to network with other companies trading in Location X will be invaluable, as will the knowledge and experience of specialists in their field.

Whilst the internet provides a vast library at your fingertips and can provide a quick and dirty answer, often sites are directed towards individuals (rather than organisations) and data on the internet can be too broad, vague or even inaccurate!

A new location is an exciting challenge for the business as a whole and, given the opportunity, an exciting challenge for global mobility professionals, enabling them to reassess policy, build key contacts in the host location and most importantly play a central role in their organisation’s expansion.

Helen Squibb has worked in global mobility for over 20 years, the last 10 years as an independent international HR consultant (HS Consulting Services Ltd) - specialising in advising organisations on their strategy and management of international assignments.

You can contact her on +44 (0)7786 443902 or helen@hsconsult.co.uk or visit www.hsconsult.co.uk for further information on her specialisms and client portfolio.

Helen also helps to develop and train on the Expat Academy courses and this topic will be further explored in the next “Global Mobility: from Administrator to Advisor” course. Further details can be found at www.expat-academy.com.

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Health

Duty Of Care: Workplace Health And Safety For Your Global Travelling Workforce When global corporations engage in world markets the employer’s duty of care and risk management capabilities need to extend beyond the usual health, safety and security requirements imposed by the familiar environments of their host country. The circumstances in which international business travellers and expatriate workforces are operating are very different and often unfamiliar on foreign soils.

Corporations must proactively and reactively manage the human risks associated with international travel on a global scale and drive through policies to meet health and safety legislation and be duty of care compliant.

In this article we will examine duty of care, workplace health and safety, and how it relates to your global workforce.

The contents of this article do not constitute legal advice, is general in scope and will not substitute a specific approach for your company.

Duty of Care Duty of care and the requirement for employers, so far as is reasonably practicable, is to ensure that employees are not exposed to risks to their health and safety at work. This has been in place, in numerous countries for over 30 years but is still misunderstood and poorly applied across large multinational organisations. It is not however, the primary act or legislation but rather a subset of the workplace or occupational health and safety laws.

The realisation or acceptance that duty of care applies to business travel, equally if not more so than traditional static workplace environments, is a relatively new occurrence.

This is not due to any significant alteration or refinement of related legislation or laws but more an awakening of conscious and a greater volume of informed employees who are both aware of, and exercise their right to, a managed workplace.

Improvement and adherence to workplace health and safety should be the primary focus to all businesses in support of business travel, not duty of care.

Workplace Health and Safety Workplace or occupational health and safety systems, standards and requirements International HR Adviser Winter

are already well developed. By expanding these systems and standards to include business travel activities, all companies can quickly and efficiently enhance the safety, security, health and environment of their business travellers without the adoption and implementation of completely new or foreign concepts. For some inexplicable reason, too few businesses have already included business travel as part of their workplace health and safety systems, exposing them and their employees to significant and foreseeable risk.

It has only been in recent times that the definition of the workplace and the conduct of business have been refined to include business travel activities. This and poorly understood or applied risk management systems that encompass business travel created an Achilles heel for most businesses, who assumed that duty of care was their only corrective imperative.

While proof regarding taking steps to ensure 'reasonably practicable' health and safety measures for employees, or the failure to do so, rests with the prosecution in countries such as Australia, the onus of proving reasonable practability rests with the defendants in the United Kingdom, Singapore and Canada.

Workplace Health and Safety for Global Workforces An increasing number of legal cases are presenting that challenge and reposition the traditional notion that the workplace is a single static location. More and more, the legislation and legal view is that the workplace is anywhere that a person or business conducting an undertaking is present. Additionally, the conventions that govern the definition of an employee are also expanding to include labour for hire, contractors and other temporary workers.

This has clear implications and inclusions for business travel too.

Notwithstanding the fact that business travel is likely to be undertaken by the top 5% of talent within an organisation, in the pursuit of profits as high as fifteen dollars per dollar spent on business travel, it is typically a competitive and financial advantage for businesses. This coupled with the growing acceptance that it is considered a place of work by an

employee means that all the typical hazard identification and risk mitigation strategies applied elsewhere in the company’s processes need also to be applied.

The act of business travel results in numerous variations such as location, gender, airlines, weather, personal health, supporting infrastructure, crime and so on. It therefore stands to reason that commensurable threat analysis, risk mitigation, control measures, compliance, tracking and disclosure should follow. Too few are at this fundamental stage.

For those companies or managers that continue to permit this 'grey area' of business travel not to be considered or treated as part of the workplace health and safety system, their time may well be up sooner than they would like. More and more business travellers themselves are questioning or demanding that they be afforded the same standards and considerations for a risk free work environment. The courts also support their views.

Business travel constitutes a workplace hazard to all employees, until proven otherwise. Only through demonstratable and consistent systems and processes can this be defensible with evidence of due diligence in the area of business travel and workplace or occupational safety.

Dave White is Director of Sales & Marketing, International Healthcare at Healix International.

Healix International is a global leader in international medical, security and travel assistance services working on behalf of multinational corporations, governments, NGO’s and insurers across the globe. They also provide employers with a unique automated predeployment medical screening service for global workforces and their dependants.

To find out more, call Healix International on +44 (0)20 8481 7720 or visit www.healix-international.com

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PENSIONS

Pension Savings And Overseas Assignees Providing pensions and savings for your overseas assignees and expatriates can be something of a minefield. Do you keep them in a home plan, set up local plans, or simply pay them some extra cash and leave them to their own devices?

When making this decision, you will no doubt consider a range of factors: • Do you handle short-term secondments differently to more permanent moves?

• What do the pension and social security systems look like in the home and host countries?

• Is the person planning on returning home or moving to another country after the assignment?

• Are they staying on the home country payroll or transferring to the local payroll?

• Do you have a large workforce already in the region, or is it a start-up situation?

These are some of the obvious considerations, but we can also throw some more challenging problems into the mix. These include: • The impact of currency movements • Poor and inappropriate investment options • Political and economic stability • Security of assets against fraud and financial collapse • Inflation risk • Taxation • Accessing accumulated benefits in the future.

You can’t, of course, be expected to manage and provide for every risk, but if you’re sending employees overseas the chances are that they have special skills or knowledge that you cannot find locally. They’re probably highly paid, highly valued and enjoy a comprehensive package of benefits back home – an important part of the attraction and retention of key people. If your benefits package is designed to attract and retain the best people, and if your company ethos is to provide benefits that help employees to prepare for retirement, why should the important people you send around the world to build the business be short-changed on their benefits? At the very least, it’s important to have a good understanding of the real issues they face and to ensure that you have considered the pros and cons of all the options.

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The options Let’s have a look at the main options.

Certainly keeping those on a short-term overseas secondment in a home plan makes perfect sense. They are probably still being paid from their home country payroll, pay tax there, remain part of the social security system and will be back home soon. So why do anything else?

For longer but still temporary assignments staying in the home country pension is still, in many countries, a good option. For example a member of a UK occupational scheme can remain in the plan almost indefinitely. Personal pensions are more restricted, with membership having to stop after five years and some contribution restrictions coming into play once the person no longer has ‘relevant UK earnings’. There is talk of the Government removing that five-year limit, but it seems likely that any tax relief will go at the same time. Some care is needed on employer contributions – they will normally continue to be tax deductible but only if they are ‘wholly and exclusively’ for the purpose of the trade.

Certainly from a member’s perspective staying in a UK plan does look attractive, particularly if there is every intention to return to the UK once the assignment is over. For the better paid, the employee contribution limit on personal pensions of £3,500 may mean that some form of top-up plan is also needed and we return to that later.

A point to note on UK personal pension plans is that the plan should be set up before the employee becomes resident overseas. The reason for this is that, while there is no statutory restriction on overseas workers joining a UK plan, the provider would need to have the appropriate permissions to transact business in the host country and for this reason most UK providers won’t admit overseas residents.

The longer-term assignee and local pensions So, we are reasonably comfortable about staying in the home plan for short-term assignments, subject to the caveats mentioned, but increasingly less so as the length of the assignment increases and the employee becomes more localised.

Should a local plan be established for the longer-term assignee? In some cases the answer will be yes but, as indicated earlier, there are potential drawbacks for our valued employee and it won’t always be an easy solution for the employer either.

From the employee’s perspective, benefits tied up in a local plan can be harder to access in the future, a local bank account may need to be kept open and benefits will most likely be paid in the local currency. If our employee is globally mobile the problem becomes compounded with each new assignment. The currency issue is more important than is often realised, as the value of benefits can be severely reduced with moving currency values, a point brought into stark reality during the current economic crisis and highly volatile exchange rates.

Another challenge with locally approved plans is do they exist at all? Certainly in the Middle East the pensions and savings market is relatively undeveloped. Pensions exist across many parts of Africa but very often have restrictions on who must manage the plan and where the assets can be invested. Being restricted to Local Government bonds and local investment funds may not be very attractive in some parts of the world. Economic and political instability are also genuine concerns in parts of the Americas, Africa, the Middle East and Far East. Even where a good pension system exists, the employer still has the challenge of selecting the right plan and coping with local regulations, which may be disproportionately time consuming for a relatively small workforce.

What other options are available and are there any more robust solutions for your more permanent assignees and global nomads? Many firms simply offer extra cash and let the employee make their own arrangements but, as we have already alluded to, it feels inherently wrong to provide less benefits for these highly valued employees than is the case if they stay in their home country. Of course you may also have a contractual commitment to provide a pension. Unfortunately there are no pensions or savings plans available that have all the tax benefits of locally approved plans and yet remain secure and easily accessible wherever in the world

Pensions your employees may be. But there is an often-overlooked option that can overcome many of the problems raised so far and which arguably should always be part of your deliberations.

International pension plans The ‘international retirement and savings plan’ or ‘international pension plan’ is a long-term savings plan for expatriates and globally mobile employees. Typically, but not always, these plans are based in an offshore location such as the Channel Islands or the Isle of Man for the simple reason of tax neutrality, as these locations levy no income or capital gains tax on the plan assets. Tax liability on payments in and benefits out are therefore determined by the location and tax position of the employee. They normally offer the facility of a number of currencies, give access to a broad range of investments and are in politically and economically stable locations. Increasingly they offer all of the support expected of, say, a UK pension plan, such as online functionality, which is arguably even more important for those working overseas. Assets held in these plans are in a single place, regardless of the country of residence, and benefits can be paid out anywhere and in most currencies.

Despite the neutral tax position in the offshore location, the lack of tax-advantaged status is a drawback. Increasingly contributions into plans held in offshore locations are being treated as immediate income and the employee is taxed accordingly, a good example being the disguised remuneration changes introduced in the UK in 2011. But in most cases this makes the employee’s tax position no worse than the extra cash scenario, with the added potential of timing the withdrawal of benefits to minimise personal tax liabilities. And, unlike most locally approved pensions, proceeds can normally be taken entirely as a cash lump sum. For the HR manager, such plans resolve a number of the problems associated with benefit provision for overseas assignees, but what are their drawbacks? As already mentioned, they’re not tax approved and there may some parts of the world or particular nationalities that the provider may not be able to accept, so not everyone can necessarily join.

Section 615 (6) ICTA 1988 On the tax point, for those companies with a UK presence there is a further type of international pension plan to consider

which has some tax benefits. By establishing the plan in trust in the UK under Section 615 (6) of ICTA 1988 (commonly referred to as a ‘Section 615 plan’), instead of an offshore location, a bona fide UK occupational pension plan is created.

This will require ‘acceptance’ by HMRC and does not amount to a fully approved UK pension, but nonetheless enables the company to obtain corporation tax relief on contributions and there is no liability to N.I. contributions. A Section 615 plan also avoids many of the benefit restrictions that apply to approved UK plans and, as with an international pension plan, benefits can be taken entirely as a cash sum. The bona fide pension status also reduces the likelihood of contributions being taxable in the country of residence and benefits withdrawn on return to the UK will either be tax free or taxed on a proportionate basis, depending upon the time spent overseas.

Given these advantages, you might wonder why Section 615 plans are not more commonplace and are there any particular drawbacks to them? Care will certainly be needed when setting up a Section 615 plan that includes employees working in the EU. Seconded employees shouldn’t be a problem, but if the employee has been localised then the cross-border pension regulations could be triggered. This is because the trust for these plans is established in an EU country, the UK, and a Section 615 plan is a recognised UK occupational pension scheme. Should a cross-border plan be created in this way the trustees would need to obtain the necessary authorisation and approval from the Regulator and the plan would need to meet the social and labour laws of each of the host countries – probably best avoided!

International pension plans and Section 615 plans have a number of possible applications. I mentioned earlier that restrictions apply on contributions to UK personal pensions once an employee has no relevant UK earnings, and that there is talk of any tax breaks being removed in the future. Most countries have similar restrictions and in any case may only offer tax breaks up to a relatively low ceiling for all plan members. International plans are therefore often used to top-up plans where such restrictions apply. Contributions may be subject to tax and social security payments, but this is likely to be no different to taking cash and the employer would be providing access to a secure,

well-governed and cost-effective savings plan. And, importantly, one which provides a flexible approach to currency, is a single plan from which benefits are easily accessible in the future, and with no statutory requirement to take a regular pension income on retirement.

End of service gratuities In many parts of the Middle East there is a statutory requirement to provide an end of service gratuity payment. Often unfunded, the liability for these payments stays within the business but increasingly companies are looking to fund for this liability.The international retirement and savings plan can, and increasingly is, used for this purpose as well.

The world of pensions and savings is complex and challenging, and all the more so when it involves overseas employees. Hopefully, I have given some food for thought and offered some additional solutions to the challenges that you face for your international assignees.

Stewart Allanson International Corporate Distribution Manager Zurich Corporate Savings.

For more information email stewart.allanson@ zurich.com or telephone on +44 (01242 664443

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European Law

Ten Things I Wish I’d Known About European Employment Law In this article Juliet Carp, Employment Partner at solicitors Speechly Bircham LLP, looks at some differences between UK and Continental employment laws.

Most of us would expect employment laws and industrial relations systems to work differently across Europe, but some of those differences can still take even the most conscientious planners by surprise. It is easy to be caught out because questions are inevitably driven by our own assumptions.

Below is a personal selection of things that I wish I had understood before I started asking European employment lawyers for help.

1. Collective agreements Understanding that collective agreements can work differently in other European countries is key to understanding why many other employment-related things work differently in practice.

In the UK a collective agreement is, broadly, an informal non-binding agreement between a trade union (or unions) and employer (or employers) about how they will work together. Sometimes aspects of the agreement will have legal force because people agree that they will.

So, for example, wages might be set automatically by collective bargaining because this is agreed between the individual employer and individual employee.

In many European countries collective agreements work differently. The first thing to be aware of is that they can apply automatically - sometimes even when employer and employee are not aware that they exist! So, for example, a sectoral collective agreement might lay out redundancy arrangements or prescribe particular forms of post termination restrictive covenant. The collective agreement might apply to an individual employee just because of the job he does and/or the place that he does it. This may be the case regardless of his individually agreed employment contract terms.

The key practical point here is that local advice is almost always needed to determine whether a collective agreement applies. The employment contract may not help. So, it makes sense to gather information that might be needed to help the adviser give clear guidance at an early stage.

International HR Adviser Winter

2. Status One key factor in determining whether a collective agreement or other employment laws apply may be the employee’s status, ie what he does for a living. Seniority (in the UK sense of “importance”) may be relevant, with many countries applying separate regimes to senior managers and ordinary workers. Often senior employees receive less employment protection than their junior colleagues. This is not intuitive in the UK where, with some minor exceptions, factory workers and managing directors are subject to the same employment laws.

Practically, this means that more care should be taken with job titles, job descriptions, duties etc., at the outset. Those decisions could have significant financial consequences, for example, for the size of a redundancy payment awarded years later.

If some effort is put into understanding the employee’s role before advice is sought there may also be some fee savings as the local lawyer should be able to identify the appropriate laws or collective agreement and advise more quickly.

3. Contracts The prevalence of binding collective agreements also helps explain why Continental attitudes to contract drafting are so different to those in the UK. UK contracts are typically longer and more carefully drafted than those used elsewhere.

If terms and conditions are set out in invariable collective agreements, why would you need a lot of detail in the contract or staff handbook? In fact, the detail may make things worse if there later proves to be a difference between collective agreement and individually documented terms. The terms of the applicable collective agreement may also change over time whilst the contract stays fixed.

In the UK employers and employees have traditionally had great freedom to choose contract terms and with that has developed a very tight approach to documenting the agreement. This is not the norm in Europe. UK observers might worry that Continental drafts are “sloppy”, leaving wide scope for dispute, whilst Continental observers might look at ours and think “overkill” or “why

include all this stuff?”. Understanding different employers’, employees’ and lawyers’ expectations, and the legal consequences, can be helpful if an appropriate compromise is to be reached quickly.

4. Post termination restrictions Competition is an area where European approaches vary considerably. Sometimes payment of salary (or a percentage of salary) is required for the duration of the covenants; in other systems payment is needed upfront and sometimes it may be appropriate to prescribe a fixed penalty for non-compliance.

(The latter is generally not a good idea in the UK.) The key practical point here is that it is worth checking the local requirements both at the outset and before any dismissal. The latter may, for example, save the employer from paying a lot of money for nothing if the covenants are not needed. If more than one European jurisdiction may be relevant to the employment it may not be possible to comply with all the local requirements at the same time and the employer may need to prioritise.

5. Collective consultation is for the long-term In the UK workplace, formal employee representation is not typical. Yes, some businesses “recognise” unions, but works councils and elected employee representatives are not common. Most key decisions are taken unilaterally by the employer without consultation.

Like Americans, British employers (and lawyers) often assume that consultation with works councils and other employee representatives is just a hurdle to get over.

Locally, things will probably be viewed differently and damaging relationships for short-term gain may have serious long term consequences. Think partnership: failing to pick up your socks on Thursday night may lead to a different answer when you suggest a Friday night out. This is an area where following local advice even where it seems trivial usually pays off.

6. Trading cost for speed In the UK we will often start with a question like “How long will it take and how much will it cost?” We like to understand the bottom line and are used to trading

European Law cost for speed. “If I dismiss him now without following the procedure how much more will that cost me?” seems a logical commercial enquiry. The answer might be balanced against salary costs during the process, potential damage to the business etc., before a decision on approach is made. The key point is that whilst there are many things employers should not do here in the UK, there is very little that employers cannot do. We should not assume that people navigating different systems think the same way.

7. “You can’t do that” means what it says “You can’t do that” may mean just what it says. Dismissals (or even in some cases transactions) can be void if the right processes are not followed - often with very expensive and inconvenient consequences. The employer may not be permitted to dismiss without seeking permission from a governmental authority or court or to dismiss certain categories of employee at all, e.g. employees who are ill or pregnant. The point here is that doing it wrong may not be cured by money: the action taken may be totally ineffective.

The employee may, for example, receive huge compensation, soak up a lot of management time and still keep his job.

The practical difficulty for those less familiar with local practices, is usually to work out when “no” really means “no”. Asking both very specific questions about consequences and more open questions about what employers normally do can help.

8. Getting it wrong can be criminal Bear in mind that failing to comply with some European employment laws can lead to criminal as well as civil sanctions and these can apply to individuals as well as companies. When in doubt, check.

9. Asking questions Which leads us to a critical skill that we all need to keep working on. Poor answers often flow logically from poor questions.

Gathering relevant information; making preferences and attitudes to compliance clear from the outset; choosing vocabulary carefully; anticipating some of the things that may be different; using both phone and email; asking both open and closed

questions; and giving some guidance on the length of answer required can all make a difference to whether you get the answers you need quickly, clearly or at all.

10. Ask the right person And finally, where the answer matters, it makes sense to invest time in choosing the right local adviser.

Juliet Carp Partner, Speechly Bircham LLP. Juliet specialises in UK and international employment law and advises on all aspects of UK employment law. Her clients are typically multinational employers.

Juliet is recognised as an expert on the employment law aspects of global mobility and is author of the leading international textbook on this topic “Drafting Employment Documents for Expatriates”. juliet.carp@speechlys.com +44 (0)20 7427 6412 www.speechlys.com

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International Assignment Policies

International Assignment Policies – The Best Policy For Your Company This article focuses on international assignment policies, why we have them, why we may not want them, concerns about them and addressing these concerns.

Reality check First a reality check; Do we need international assignees, especially as it is commonly stated that the cost of an assignee is 2 to 5 times higher than the cost of a local hire? An international assignee in this context means any employee moving to work in a country other than their home country, although your company may have a different name for such individuals. Despite predictions of a decline in assignee numbers, many companies expect either to maintain current assignee numbers, or indeed, increase such numbers for example in regions such as Asia Pacific, South America and Africa. The international assignee will continue to exist for the foreseeable future.

Why do we need expatriates?

Assignees are required for a variety of reasons, including: • Instilling corporate/headquarter culture • Covering a vacancy • Plugging a skills gap • Training and transferring skills • Providing specific project expertise • Career development • Personal request.

Companies will have different reasons as to why they want or need assignees. Such reasons are likely to influence the type of policy that is most appropriate. The greater the company need for an assignee, the greater the likelihood that the cost will be higher. Conversely, if the individual is driving the move increased opportunities exist for the company to reduce costs.

Equally, certain types of assignment, for example, project expertise, may be more shor- term in nature. This may affect what you offer and the tax consequences arising from the assignment.

Reasons why a company should have a policy Companies are not obliged to have a policy but there are a number of reasons why they might want one. For example, having a written policy is useful, International HR Adviser Winter

as when employees and human resource professionals leave, memories fade and may become selective. A written policy will help to provide a legacy to follow.

It is useful to have a policy, as otherwise individuals will negotiate their own packages with the possibility that each leverages off the previous package, naturally adding their own embellishments and costs. All of us know that assignees talk, rumours abound, and they all want only the best that each company offers. A policy provides discipline and a precedent.

Furthermore, it enables the corporate culture, both headquarters and local, to be reflected in any assignment package.

A policy should aid mobility. It can set out logically the steps to be taken in any move, the remuneration and benefits applying, and the procedures to be followed. A policy can also convey what will happen as assignments change in nature and it can therefore incorporate flexibility to smooth issues arising on such changes. Additionally, a policy can address relevant issues to ensure the company is legally compliant in home, host and other countries.

Reasons why a company may not want a policy Conversely, there are a number of reasons why companies may not want a policy.

Assignees do talk and there is a potential danger that putting together a policy results in ending up with a “best of the best approach”, whereby all the nice to have elements of different company policies are pulled together as one great (for the individual!) but expensive policy.

It is feasible that any policy does not have the flexibility to adapt to changing circumstances, whether this is in respect of the assignment, the job, the company or general economic and political developments. A policy once written can, if allowed, become static, never changing to reflect such issues.

Some companies may be fearful of their lack of experience in creating their own policy or the professional cost of getting assistance in designing a policy. This may be a feature particularly if the company has very few international assignees or will have them moving only between specific countries.

Areas for concern When considering international assignees and consequently policies, there are a number of areas for concern. “Fairness” is a word often raised when it is time to discuss assignment packages. Increasingly people are questioning to whom should one be fair? Is it just the assignee?

Other interested parties may include other employees, the employer and the shareholders. For example, is it right to pay an assignee more than a locally hired employee doing the same job? Taking this a step further is this even legal? Naturally, this is a question for lawyers.

Legislation is constantly changing, be it employment law, immigration, tax and social security law. When considering assignees how do you ensure you are compliant in relevant locations? One also needs to keep up to date with political and economic developments, for example, inflation and changing exchange rates. Just think how much the US dollar has fluctuated against the Euro since its inception. Companies may also have to keep up to date with competitors. The “war for talent” still continues.

The family creates its own share of issues. This can include family disruption for example, the education of children and the problem of dual careers. Other more easily addressed issues include changing assignments and switching between policies, together with the ending of the assignment and possible localisation.

Commuter assignments have evolved to address some of these family challenges but they also bring their own issues.

Cost rears its head again with issues such as getting sign-off to an assignment in the first instance – how many line managers create a fuss when they realise the cost of an international assignment handled by them without human resource assistance or even knowledge? Additionally, what is the tax and social security cost of an assignment and how can this be mitigated?

Other areas of concern include how do you define a short-term or long-term assignment, what salary and benefits package should be provided in different assignment situations, and what tax and social security implications arise?

International Assignment Policies Addressing these issues There are certain general principles to be followed when starting to address these issues: • Decide on your approach to international assignments. For example, are you going to compensate for loss of spousal income, and if the employee is driving the move, or if it is for their long-term career advantage, do you offer as much assistance?

• Get a policy that suits your company and the situations that will arise. A comprehensive policy may be additional to your actual requirements • Incorporate flexibility to cover changing assignments and different situations • Review the policy regularly to ensure it keeps up to date. Policies using set tax deductions or exchange rates quickly become out of date • Remember you don’t always get what you pay for. Developing a policy can be very cost-effective • Other issues may also need to be considered. For example, the security of assignees, reducing benefits over time, dual career issues and same sex and/or unmarried partners • Do ensure the policy matches your corporate culture, language & values.

As you create your policy do bear these principles in mind.

Policy definitions and benefits to be offered The policy should cover terminology, process and the benefits to be offered in different circumstances. For example: • The definitions of a business trip, a short and long-term assignment. These will vary between companies • Responsibility for the assignee, to include management, reporting and mentoring • What happens when assignments change from one category to another category and the applicable date? For example, if your policy definition says a business trip lasts for 30 days, if by chance it is extended to 31 days, is it now a short-term assignment with all that may entail?

• Choosing an assignee, for example reviewing the best person for a job – it may be a local or external hire – and selecting the right candidate. Cultural adaptability and training are particularly relevant as most assignments fail as a result of the family’s failure to settle • Costing – the costs of an assignment

should be determined preferably in advance so that all are aware and sign off to the expense • Calculation of allowances. For example, are cost of living allowances to assume the individual will choose equivalent local produce as opposed to known brands, how often exchange rates are to be reviewed and de-minimus fluctuations to be ignored?

• Localisation and the phasing out of allowances if the individual remains in the host location • Interpretation – who decides and arbitrates in the event of any dispute?

When looking at the various benefits provided within an assignment policy, these could include the following: • Accommodation – what standard of accommodation? Can or should you always provide “like for like” accommodation when on assignment?

• Transport – do you provide a company car and what about a driver in certain locations?

• Travel – what class and is home to office travel covered?

• Insurance – extended medical coverage, house and contents insurance at home and host, travel insurance etc.

• Home leave – how often, class, number of family trips etc?

• Holidays and hours of work – local or home and are there legal implications?

• Transportation & storage costs • Schooling – international schools, boarding schools and extra tuition etc.

• Others benefits – it’s amazing how much assistance may be requested and how helpless some otherwise intelligent people become once they go on an assignment!

Remuneration When looking at pay at what rate and where do you pay? It could be home, host, another country or a combination. Individuals are on assignment to undertake a specific function, or are there for a specific reason. Should the pay be adapted to fit the underlying reason? With regard to variable elements of pay such as bonuses or stock awards, are these to be based on home or host country individual performance, home or host company performance and plans?

It is often stated that the behaviours and performance obtained are linked to what is measured. Adapt what you measure to link into your corporate aims and business strategy and specifically your aims for the assignment.

Legal issues Legal issues need to be considered in any assignment as working across borders brings additional legal complications. What prevailing law will apply, is it the home, host, EU, another country or a mixture? What information has to be contained in any employment contract or assignment letter and how and when do individuals need to be notified? Do think about data protection rules and exchange of information. Additionally immigration rules constantly change. Do ensure your policy is legally compliant.

Tax and social security No international assignment policy article would be complete without raising the thorny issue of tax and social security. Tax and social security issues will be addressed in our next article but do bear in mind these need to be considered whilst developing a policy.

Summary In summary, when designing a policy get one that is suitable for your needs, that is competitive and offers value to you. Decide how you wish to utilise and reward your assignees and align the policy to your business strategy. Ensure that sufficient flexibility is built in to the policy and regularly update it to suit changes both within the company and from a wider perspective. Do remember that a good assignment policy is but one aspect to getting things right. You also need to have the right processes and systems to ensure the policy is workable bearing in mind the strengths and weaknesses of your organisation.

In response to the question “what is the best policy?” it is important to remember there is no right or wrong answer. Ultimately it is the policy that works best for your company.

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

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GLOBAL taxation

Global Taxation Update Australia Australian “Living Away From Home” tax concessions removed for most expatriate employees.

The proposed changes to LAFH tax concessions became effective on 1 October 2012. As a result, the vast majority of expatriate employees in Australia will no longer qualify for tax exemptions on accommodation and certain food costs.

From 1 October 2012, employees will only be able to access the tax concessions for up to 12 months if they are required to live away from their “normal residence in Australia” and maintain that residence for their use whilst they are living away from it.

For example, an employee who has a normal residence in Sydney, but is required to live away from it for work purposes and live in Perth for 10 months, may qualify for tax concessions if they maintain the Sydney residence for their use whilst living away from it. It should be noted that not many expatriate employees will be in this situation.

Although transitional rules for current arrangements in place on 8 May 2012 may grandfather tax relief by extending tax concessions up to 30 June 2014, these rules will only apply to those expatriate employees in Australia who are living away from their “normal residence in Australia” and maintaining it for their use.

Going forward, benefits including accommodation and food allowances will be taxable for most expatriates in Australia.

Moreover, these costs will be most likely be treated as fringe benefits and taxable to employers (not employees) at the Fringe Benefits Tax rate of 46.5% grossed up.

BDO comment There is scope to reduce overall tax costs by restructuring expatriate remuneration packages to replace accommodation/food allowances and benefits with other items that are taxed at the lower progressive income tax rates. Clearly, care needs to be taken in any remuneration restructuring to ensure that the employer’s international assignment policy and tax policy objectives are met.

France French Draft Budget Law for 2013 The French Prime Minister released the draft budget for 2013 on 28 September International HR Adviser Winter

2012 (the “Finance Bill”). Please note that the Finance Bill remains subject to amendments.

The Finance Bill particularly impacts high net worth individuals. However, the favourable regime applicable to expatriates coming to France is not affected by these austerity measures.

Introduction of new tax bands for income tax The proposal is to increase the highest income tax rate from 41% to 45% for taxable income over EUR 150,000 (for a single person).

The table below summarises the anticipated tax bands for income earned by individuals in 2012: In addition, an income surcharge of: • 3% is applicable to income between EUR 250,001 and EUR 500,000 for a single taxpayer and between EUR 500,001 and EUR 1,000,000 for a married taxpayer • 4% is applicable to income exceeding EUR 500,000 for a single taxpayer and EUR 1,000,000 for a married taxpayer.

Furthermore, a new charge of 18% is expected to apply to income earned in 2012 and 2013. This rate will apply to income from professional activities (wages and business income) exceeding EUR 1,000,000 per taxpayer. This contribution comes after income tax at 45%, income surcharge at 4% and social surcharges on professional income of 8% (i.e. effective tax rate of 75%).

Modification of the taxation of dividends, capital gains, interests, and vesting gains Currently capital gains on movable assets, (shares, etc.) are taxed at a fixed rate of 19%. As from January 2012, these gains are subject to progressive income tax

rates. To encourage long-term ownership, an allowance will apply for income tax depending on the length of ownership, with a maximum exemption of 40% after 12 years.

Currently vesting gains on awards (stock options, RSU, etc.) can benefit from reduced tax rates. As from January 2012, they will be subject to progressive income tax rates.

BDO Comment It remains to be seen whether these measures will have the desired effect. A number of high profile, high earning individuals have left France and taken up tax residence elsewhere in recent months and additional tax revenues income ultimately generated may be negligible.

United Kingdom UK inbound employees and cash settled options – HMRC confirm their stance If a share option (or ‘securities option’, as used by the legislation) is granted whilst an employee is UK non-resident and the option is not granted in respect of current or prospective UK duties, there will be no UK tax on the exercise of the option. This is regardless of the employee’s UK residence status on the date of exercise.

However, this tax treatment only applies to securities options and is therefore dependent on the award meeting the definition of a securities option per the UK legislation.

If an equity award does not fall within the securities option definition, the award will usually be taxable as general employment earnings either at the time of exercise or vesting depending upon the structure. Any portion of the gain which can be sourced to the UK would therefore be liable to UK tax, regardless of the individuals’ residency status at the date of grant.

Tax Band

Tax Rate

Up to EUR 5,963

0%

EUR 5,964 up to EUR 11,896

5.5%

EUR 11,897 up to EUR 26,420

14%

EUR 26,421 up to EUR 70,830

30%

EUR 70,831 up to EUR 150,000

41%

Above EUR 150,000

45%

global taxation This can result in unexpected costs and a withholding obligation for the employing company (especially if the employee is tax equalised), additional tax for the employee and potential double tax implications.

The position for NICs does not necessarily track income tax and can be even more complex depending upon the facts.

A ‘securities option’ is defined in the UK legislation as ‘a right to acquire securities’. If the employee does not have a right to receive securities but may (at the company’s discretion rather than the employee’s) instead receive something other than securities, such as cash, the equity award may fall outside of the securities option legislation. It is also possible to receive an equity award that is a promise but that falls short of constituting a ‘right’ in order to be an employment related securities option. Awards which are granted under non-UK plans (for example, under US plans) often fall outside of being securities options, for example, due to the way that they are documented or if they include a provision in the plan rules which allows the company discretion over whether to settle equity awards in cash, rather than shares.

What has changed?

There has been no recent change to the legislation in this area. However, on 13 August 2012 in an amendment to their manual on Employment Related Securities, HMRC confirmed their view that ‘restricted stock units’ (RSUs) should generally be taxed as general employment earnings at vesting. RSUs are commonly awarded by companies where the parent company is in the US or another non-UK jurisdiction. HMRC’s guidance also confirms the view that if an equity award provides a right to acquire either shares or the cash equivalent of the shares at the company’s discretion, this treatment of general employment earnings at vesting or exercise should also apply. This suggests HMRC may increasingly be looking to review the tax treatment of equity awards where they suspect that they do not meet the definition of securities options and we are aware that HMRC have been writing to employers looking for additional tax as a result.

BDO comment As an employer with potential withholding responsibilities, it is important that companies with UK inbound employees holding equity awards understand how

awards should be taxed for UK purposes.

The above analysis becomes even more complex when those inbound employees subsequently leave the UK holding equity awards. In order to understand the tax treatment, this will require a review of the terms of the equity awards made to employees. Whilst this is often clear for equity awards granted under UK law, this can be more of a grey area for equity awards granted under overseas law.

Whether or not an equity award is both a securities option and a ‘legal option’ will potentially affect the timing of the tax charge, who has the responsibility to pay the tax and the tax amount, therefore the onus is on the employing company to ensure that this is reviewed.

There is no clear answer but this will depend both on the detailed facts and value judgements.

United States New Streamlined Filing Procedures announced by IRS for US Citizens Living Abroad The United States of America is one of the only countries in the world who subject their citizens to taxation when such citizens are resident in other countries. For many US citizens abroad, there is no net tax liability to the US due to the foreign earned income exclusion, foreign tax credits and international income tax treaties. This is one of many reasons that some US citizens living abroad may not have met their US tax filing obligations. However, the IRS has been actively pursuing highnet worth US citizens living outside the US who have not filed US personal tax returns and who have not disclosed offshore investments to the IRS. As part of this initiative, the IRS has launched a series of Offshore Voluntary Disclosure Programs (OVDPs), the most recent of which was announced in January 2012.

Partially as a result of media coverage of such initiatives, many US citizens of ordinary means have become aware of their US filing obligations, but may not have filed for fear that substantial penalties could apply if they brought their US tax filings up to date.

On 26 June 2012, the IRS announced a new procedure for dealing with lowrisk US tax filings for US citizens living abroad, to go into effect on 1 September 2012. At that time, the IRS stated that further details would be announced prior to effective date. On 31 August

2012, these details were released on the IRS website.

This new procedure will primarily benefit US citizens who have lived outside the United States since 1 January 2009, who have not filed US tax returns and who represent a low level of compliance risk to the IRS. Moreover, US citizens living abroad who have filed US tax returns but have not made an election under a United States tax treaty to defer US tax on income earned in certain nonUS retirement plans will also benefit.

A low compliance risk to the IRS generally means the taxpayers owe less than $1,500 on each of the past three years tax returns, and do not have any indications of higher risk to the IRS as evidenced by the tax returns and answers to a mandatory questionnaire.

To take advantage of this new process, these individuals will need to file tax returns for the past 3 years, a Report of Foreign Bank and Financial Accounts (FBAR) for the past 6 years, and complete an IRS questionnaire. The IRS will assess risk based on a submission of these items, and if it is determined that the taxpayer fits the low-risk profile, the processing of the returns will be expedited and the IRS will not charge penalties with respect to these late filed returns.

US citizens who are required to, but have not filed US returns, and who do not qualify for this expedited process for filing previous years’ tax returns, may consider accessing the Offshore Voluntary Disclosure Program mentioned above.

BDO comment Although the announced streamlined process is designed to simplify compliance for those, low-tax risk, US citizens resident outside the US who have not filed their US returns, filing prior year’s tax returns and FBAR forms as a result of non-compliance can be a complex process.

Circular 230 Any US federal tax advice contained in this communication is not intended to be used, or written to be used, for the purposes of avoiding penalties under the Internal Revenue Code, or for promoting, marketing, or recommending to another party any tax related matter.

Prepared by BDO LLP. For further information please contact Andrew Bailey on 0207 893 2946 or email: andrew.bailey@bdo.co.uk Winter International HR Adviser

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Expatriate Adviser Summer

Autumn International HR Adviser

Risks in Emerging Markets

HR Risks In Emerging Markets With 80% of the world’s 3 billion workers in developing and emerging economies, it is no wonder many leading organisations have their sights set on expanding their operations in these markets.

It is estimated that 70% of world GDP growth will come from emerging markets in the coming years. This, compared to the somewhat modest growth trajectories forecast for US and European economies make emerging markets extremely attractive for many global organisations looking to capitalise on the abundant opportunities. Nevertheless, it is those with the agility to adapt, and are able to anticipate and manage risks and opportunities, who are most likely to have the greatest competitive edge.

This article discusses some key people and organisational risks faced by global businesses looking to operate in these economies.

The Role of HR Global companies doing business in these markets need to ensure they are well equipped with the information and expertise needed to manage effectively within these complex environments. Each market has its own unique operational challenges, shaped by prevailing political and socio-economic structures, consumption trends, scholastic systems, and cultural norms, which consequently drive market practices. In order to succeed, businesses will need to understand the conditions within the markets in which they operate, and adapt accordingly.

For companies looking to globalise and prosper in these diverse economies, having an effective HR function can help prevent costly errors and enhance longterm results. Experienced, skilled and resourceful HR teams will be critical to a company’s future growth and sustainability. HR practitioners within multinational companies will need to take a holistic approach, and find equilibrium between local market and cultural trends, and the broader corporate strategic aims. For many, this will mean a transition from the traditional, reactive back-office support function to being progressive partners who are strategic assets to the business.

Multinational corporations (MNCs) should review their people agenda and policies, taking into account both the local and global corporate perspective to

maximise the competitive potential of employees across global markets. Recruitment and retention policies, learning and development practices, and reward strategies will need to all evolve as global companies strive to create and promote a company brand that will attract and retain both employees and customers.

Doing business and risk factors Before embarking on new business ventures, companies need to ensure appropriate due diligence is carried out to manage any potential risks. When evaluating potential markets for expansion, companies should consider the following key risk factors:

Politics A country’s political and socio-economic environment can pose serious threats to businesses. The ability to assess the political and social situation will enable companies to get a good measure of the market’s level of stability in order to make key decisions on the investment. Emerging markets are well known for their volatility, where conditions can change rapidly depending on the social political climate - resulting in legislative, tax and regulatory reforms, and where unexpected transfer risks can arise without notice. For companies operating within these markets, the ability to respond to rapidly changing circumstances is as imperative as the execution of strategy or implementation of policy.

Integrity Bribery and corruption remain serious issues in a majority of these markets.

Companies should ensure the appropriate due diligence is carried out on potential partners and suppliers to prevent any possible reputational damage further down the line. Transparency International’s latest ranking puts Brazil at 73, China just behind at 75, India at 95 and Russia way down the table at 143. For companies with a US or UK presence, the Foreign Corrupt Practices Act and UK Bribery Act will be an important consideration. Because of the extra-territorial jurisdictional reach of this legislation, implementing an effective programme for vetting partners and vendors should be a critical priority in all of the markets in which they operate.

Security Physical risks to people and assets are an unfortunate reality in some emerging countries due to poor infrastructure and instability. Companies have a duty of care to their people to ensure they provide a safe working environment and are protected from crime, violent protests, and at the extreme end kidnap and terrorism.

According to a survey conducted by the Economist Intelligence Unit only 30% of companies surveyed had conducted regular risk assessments after their initial investment had been made. This suggests a degree of complacency in assuming a risk assessment made at the outset of an investment will protect operations over the longer term.

Organisations should ensure they conduct regular risk assessments and provide appropriate training to employees to prepare them for the conditions they are likely to face and implement sound crisis management plans to prepare for the unexpected.

These potential risks should not necessarily deter potential investors, but should make them better informed and more aware of their responsibilities when making key business decisions.

Other HR and business issues to consider include:

Laws and Regulations In many countries employment laws and regulations are by and large favourable to employees. This can pose significant pressure on a company’s finances if not properly managed. Local laws and regulations should feature in a company’s planning and cost analysis prior to any engagement to avoid any costly pitfalls.

HR teams should ensure they are aware of such laws, regulations and practices, and help the business interpret what these mean in practice, from both an operational and cost perspective. Consideration must be given to all employment issues – visa, tax, social security, health care, pension benefits and unemployment compensation - in the event of possible individual dismissals, or multiple contract terminations as a result of restructures or closing down an entire operation. In some locales it may not be permitted to terminate employees without incurring government-mandated costs, Winter International HR Adviser

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Risks in Emerging Markets whilst in others, employers are required to give substantial notice before contract terminations. Missing this type of pertinent detail could be extremely costly for companies who are caught unaware.

In countries such as Brazil, it is illegal for companies to have more than onethird of their total workforce consist of foreign workers. This, coupled with strict visa requirements can present difficulties for MNCs wanting to deploy expatriates to conduct the initial operational set up in this locale.

In China, since the Labour Contract Law was introduced in 2008, it has become easier for employees to file wrongful dismissal claims. Unlike the US, there is no “at will” employment in China. All terminations must have a cause, with the burden of proof on the employer to justify the reasons. Those causes must be stipulated by law and clearly proven, making it difficult for companies to terminate employees during the term of their employment. As such, it is common practice in China to employ people on initial fixed-term contracts to allow some control and flexibility. There are also different municipal laws which need to be considered depending on where the company operates adding an extra layer of complexity to the interpretation of local legislation.

Laws and regulations rapidly change, therefore keeping abreast of changes is vital in ensuring the company is not caught out. Failure to do so may have consequences which exceed the usual fines and penalties. Breaching laws and regulations can have an impact on the company’s brand and reputation, and furthermore damage relations with the local authorities which can have serious implications for future business in the market.

Building relationships with foreign governments and local authorities may be a way for companies to better understand the political system to assess and potentially pre-empt any future changes. In some markets, these types of relationships are essential to understanding the dynamics of how to work with the government and adapt company practices.

Recruitment and Retention The global war for talent remains prevalent in emerging markets. This situation only intensifies as businesses grow within the market. From the outset, HR teams should review the broad demographic and educational environment as well as details of employment legislation and other potentially restricting factors, to determine the International HR Adviser Winter

quality and quantity of available talent, and overall feasibility of operating in the market.

A primary reason for the talent shortfall in emerging markets can be inadequate education or training. While the number of graduates has grown by between 30% and 50% in many emerging nations over the past few years, it is estimated that only 10%-20% of those graduates are employable by international standards, significantly reducing the talent pool in those markets.

Clients we have worked with report higher staff turnover in some emerging markets. Employees recognise talent shortfalls and can switch organisations for what may appear to be a nominal improvement in salary or benefits. The cost is often to the clients who inevitably have to bear the deterioration in service. Companies usually respond with a reactive counter offer to limit attrition, which sometimes mitigates the issue. However, this is typically a shortterm fix before a bigger and better offer comes along and restarts the cycle.

Companies need to think more creatively about their reward proposition within these types of diverse markets.

Understanding the culture and demographic is key to understanding what workers value in those markets – this will differ from country to country, culture to culture. The simplest solutions can sometimes be the most effective. For instance, some factories in China reported better retention rates following the introduction of improved cafeteria food and a pleasant working environment. At the core of it, the company’s HR functions must become acquainted with relevant cultural issues to develop the right retention strategies that cater to employee needs and preferences within the market.

Global companies should not make dangerous and potentially costly assumptions based on their home country norms. HR teams should play a key part in translating laws and regulations, and beyond that, recognise local culture and customs which may impact ways of working in the market and adapt local employment practices and engagement methods accordingly.

Talent Management It is equally important to have a robust talent management strategy to develop and retain high potential individuals as it is to recruit top talent from across the world. Formulating well-designed remuneration packages that reward and incentivise people at different levels will

go some way to helping organisations achieve this. However, companies should look further than compensation and benefits, at other critical retention factors to manage their talent effectively. These include creating transparent and flexible career opportunities, having a transparent performance management system that encourages regular performance feedback, and provides employees with a clear understanding of objectives, roles and responsibilities. Progressive training and development options, good work/life balance and effective people management also play an important role.

Whilst it is important for multinationals to apply global principles to their talent management practices, a one size fits all approach may not necessary work when operating within such diverse markets.

There should be recognition that different cultures may interpret these systems differently. For example, it is the norm within Western companies to commend the top 5% high performers and identify poor performers. However, in Asian markets, where people prefer to focus on strengths rather than weaknesses, direct and especially public criticism is not culturally acceptable. Therefore, the engagement techniques used to implement these practices should take into account the market and cultural sensitivities.

Conclusion The significance of emerging markets has become more prominent as growth forecasts in developed economies remain stagnant. However, past experiences have demonstrated the risk of doing business in emerging economies and the importance of getting the fundamentals right, such as having good people, an awareness of culture and a robust risk management plan.

Rather than fall into the trap of complacency, leaders should continue to exercise a degree of scepticism and continue to challenge the organisation’s strategic plan.

Growth potential in emerging markets are so enticing that many plans are formulated too hastily, without thought to the complexities of operating in those markets. Companies should therefore ensure they are well informed and continuously adapting to the ever-fluid risk conditions in emerging markets to achieve longerterm sustainability.

Thuy Niven, HR Business Partner for business risk consultancy, Control Risks.

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MANAGING MODERN MOBILITY

The Future Of Modern Mobility

Talent Mobility Is In The Grip Of Radical Change…

Many of the new approaches to modern global mobility have added more complexity to the mix. A marked shift in mobility patterns is resulting in more flexible opportunities but in new and different forms, including the lack of relocation as well as the emerging concept of a borderless workforce.

“The business world is in the midst of fundamental change and in 2020 and beyond the agility of organisations to manage their global talent efficiently will mark the difference between success and failure” (PwC, 2012).

A recently published PricewaterhouseCoopers (PwC) report, Talent Mobility 2020 and Beyond (PwC, 2012) paints a picture of a business world that is far removed from that of today. It highlights that talent and mobility strategies will need to progress significantly to keep pace with a rapidly changing globally connected business world and that further increases in employees working outside their home location are to be expected.

The report states that the issue of modern mobility, whilst now becoming a firm fixture on boardroom agendas, is also causing some major headaches.

The key global issues highlighted in the 2012 PwC report include significant population change and shift, an ageing workforce and the impending retirement of the baby boomer generation, which is set to pose serious challenges for most developed countries and some emerging markets. By 2015 one third of China’s population will be over the age of 50, whilst in India 50% of the population is under the age of 30.

Globally there are currently 3 generations in the workplace, each with different values, expectations and needs. Each reflect one of the three different eras of international assignments: • Baby Boomers (born post World War II between 1946 to 1963) – During the 20 year period between 1970 and 1990 Western multinationals drive international assignments from West to East.

The typical pattern of two to five year postings prevail, incentivised with attractive expatriate packages and with a return to the HQ or home location at the end of the post. This ‘Baby Boomer’ International HR Adviser Winter

generation are now starting to face impending retirement • Generation X’ers (born between 1963 to 1982) – Between 1990 and 2010 different mobility packages evolve as a result of rapid technological innovation and emerging markets worldwide. The era of companies working 24/7 evolves.

Flow of talent is still predominantly from West to East and traditional expat package programmes prevail but globalisation and the emerging BRIC markets impact on global talent mobility patterns resulting in the emergence of the mobile worker, virtual working and short-term commuter postings • Millennials (Gen Y’ers born between 1982 to 2002) – The explosive growth in emerging markets in the last 15 years with global and technological limitations diminishing paints a much bigger picture of global mobility in 2020 and beyond. A world with no borders or boundaries, other than political and legal restrictions and frameworks, increases the need for fluid movement of talent globally to meet the business needs. A marked shift in workforce and mobility patterns with new forms of domestic and global mobility emerging in response to business demand and employee preference.

THE CHALLENGES OF MODERN MOBILITY So what are the modern mobility challenges that organisations and talent managers now face?

Global Business Challenges – the CEO headache The CEO has a growing problem of meeting fluid business needs that focus on the priority of talent acquisition and retention. What keeps the CEO up at night is how to get the right people and skills in the right place at the right time. As a result leading companies are looking to align Global Mobility Programmes with Business Planning, Talent Management and Retention.

Modern Mobility – the HR headache Global business and modern mobility needs

are forcing HR to focus on 3 complex issues: supporting mobility decisions, managing programme costs and ensuring compliance requirements are met. And there is also the need to develop well-rounded leaders for the future who have international experience and competencies.

As highlighted in the PwC report, diverse mobility solutions are already developing according to the latest business needs and they include: • Short-term assignments - less than 12 months with generally lower mobility costs • Project based assignments - temporary or frequent assignee visits • Commuting and extended business travel – assignees work in a location without relocating • Intra-country mobility – the transfer of skilled workers from one country region to another • Rotational employee programme – the development of high potential employees • Reverse transfers – talent from emerging markets are moved into developed markets to gain experience and skills • Global nomads – experienced specialists constantly on the move to meet business needs with no expectations to return to the home country • One-way relocation – permanent relocation of key managers and their families • Contingent labour – specialists deployed at short notice to meet an immediate business need • Virtual Mobility (mobility without moves) – the use of technology to communicate globally across time zones.

The impact of modern mobility And as these more efficient, short-term and cost-effective alternatives to traditional global mobility are implemented in response to the business need to move talent quickly, a new pattern of mobility is emerging – the traditional ‘duration based’ assignee role is gradually being superseded by the ‘purpose based’ mobile worker and there is now also an emphasis on the lack of relocation.

But what does this mean for CEO’s and HR professionals? There is already awareness of the need for more diverse

MANAGING MODERN MOBILITY selection criteria, more attention to risk and compliance and a keener eye on costs and ROI. But what else do businesses and HR departments need to also consider? What might be the wider, and as yet unknown, impact of these different mobility solutions on individuals and organisations?

The question of the impact of prolonged global mobility has preoccupied Families in Global Transition, (FIGT) a US based, non-profit global mobility support organisation for over 10 years.

During this time FIGT has been studying a particular demographic of the baby boomer and Gen X population, often referred to by sociologists as Third Culture Kids (TCK’s) or Global Nomads, to better understand how prolonged crosscultural immersion and the necessary adaptation might impact an individual’s psychological and developmental profile.

The definition of a Third Culture Kid is a person who has spent a significant part of his or her formative developmental years (between 11 and 18 years old) living outside their parents’ culture(s) usually for the purposes of the parents’ work.

The TCK frequently builds relationships to all of the cultures that the family has been immersed in, while not having full ownership of any.

Looking into the psychological profiles of TCK’s and global nomads we already know that their cross-cultural lifestyles, whilst making them excellent global leaders, can also lead to complex issues of identity and belonging at different times during their lives. It is now important to map this cultural-marginality issue across the Millennial generation to look for similarities and differences.

In this era of modern mobility is it now time to widen this important research agenda to explore what happens when these millennial individuals enter and mature in the workplace. How does rapid deployment impact on an individual’s sense of home and belonging?

What we already know about the Millennial worker Millennials will form the majority of the workforce by 2020 and their expectations are reflective of the changing economic, technological and increasingly globalised environment that they are immersed in. They expect to have several different employers during their career and many expect an overseas assignment during the early part of their career as part of their

learning and development. They also expect fast career progression and are more focused on interest and opportunity rather than monetary awards. Home countries are starting to become less relevant to Millennials.

What we don’t know What we don’t know and what now needs to be explored is what the personal and psychological impact might be over time for this millennial globally mobile population as a result of their experience of shortterm and frequent international mobility.

What issues might they face as a result of their rapid transition experiences? How does the experience of short-term mobility impact on their ability to integrate and adapt; on their sense of identity; on how they build and sustain relationships and on their work/life balance?

From a cross-cultural perspective does a borderless world mean that we will come to be at home everywhere? Will it mean the end of global difference as internationalism replaces local values, customs and commerce? And how might the experience of short-term mobility, frequent transitions and the lack of immersion and integration impact on the significance of where home might be - on one’s sense of belonging?

Also what traits and talents do companies need to look for in employees who are expected to undergo rapid deployment? And how do they engage and retain this talent over time?

The FIGT UK Research Agenda Our newly launched FIGT UK affiliate in Oxford is keen to explore these important questions and to push this modern mobility research agenda forward in the UK. Our research agenda at FIGT UK is to link existing data on the TCK profile with researchers and practitioners across different disciplines to create new research streams relevant to 21st century global relocation and these modern mobility migration issues.

The aim is to compare and contrast different mobility experiences as identified in the PwC report and to look for common themes within them. It’s important to establish whether old models of “normal” development and identity still stand or whether we need new concepts and constructs for defining culture and belonging in the world of modern mobility.

Research will help organisations better manage and support the era of modern

mobility but it’s important to remember also that the issue of cross-cultural adaption is a Western concept evolving from more than one hundred years of multinational expansion. We also need to be mindful that there are now younger multinationals emerging from the Far Eastern and Southern cultures that might take a very different approach to the management of global mobility. Integrating research with these organisations will be a challenge going forward but is also necessary to establish a truly global perspective on the future of modern mobility.

To access the report: ‘Talent Mobility 2020 and Beyond – the future of mobility in a globally connected world’, PwC, 2012. www.pwc.com/gx/en/managingtomorrows-people/future-of-work/global-mobility-map.jhtml.

FIGT UK is an Oxford based affiliate of Families in Global Transition (FIGT) a US based cross-cultural and global mobility support organisation.

The mission of FIGT UK is to focus on 4 key areas of global mobility - education, networking, research and support.

The FIGT UK affiliate is co-chaired by executive coaching consultant Wendy Wilson and Claire Snowdon, Director and Founder of Expat Know How, a relocation training and support company.

FIGT UK, Oxford.

Website: www.figt.org/uk_affiliates Directors: Wendy Wilson E: Wendy@wendywilsonconsulting.com Claire Snowdon E: Claire@expatknowhow.com

FREE SEMINAR

Third Culture Kids Raising Portable Children

at The 2013 Corporate Relocation Conference & Exhibition on Monday 4th February at Hotel Russell, Russell Square, Bloomsbury, London.

To register your free place please email helen@internationalhradviser.com Winter International HR Adviser

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survey

2012 Quality Of Living Worldwide City Rankings Survey The results of Mercer’s recent survey are as follows: • European cities continue to dominate the top of the ranking; Vienna remains at the top, Baghdad at the bottom • London and Birmingham are the topranked UK cities for overall Quality of Living • London ranked 6 in world for quality of city infrastructure with Birmingham and Glasgow ranked 44 Singapore ranks highest for city infrastructure, Port-au-Prince the lowest.

Vienna retains the top spot as the city with the world's best quality of living, according to the Mercer 2012 Quality of Living Survey. Zurich and Auckland follow in second and third place, respectively, and Munich is in fourth place, followed by Vancouver, which ranked fifth. Düsseldorf dropped one spot to rank sixth followed by Frankfurt in seventh, Geneva in eighth, Copenhagen in ninth, and Bern and Sydney tied for tenth place.

In the United Kingdom, London (38), Birmingham (52) and Glasgow (55) are the cities ranked highest for quality of life, followed by Aberdeen (56) and Belfast (64). London was ranked number 6 in the world for the quality of the city's infrastructure. Glasgow and Birmingham were both ranked 44th while Aberdeen and Belfast were ranked 69. Globally, the cities with the lowest quality of living are Khartoum, Sudan (217); N'Djamena, Chad (218); Port-au-Prince, Haiti (219); and Bangui, Central African Republic (220). Baghdad, Iraq (221) ranks last.

Mercer conducts this survey annually to help multinational companies and other organisations compensate employees fairly when placing them on international assignments. Mercer's Quality of Living reports provide valuable information and hardship premium recommendations for many cities throughout the world. Mercer's Quality of Living index list covers 221 cities, ranked against New York as the base city.

This year's ranking separately identifies the cities with the best infrastructure based on electricity supply, water availability, telephone and mail services, public transportation, traffic congestion and the range of international flights from

local airports. Singapore is at the top of this index, followed by Frankfurt and Munich in second place. Copenhagen (4) and Dusseldorf (5) fill the next two slots, while Hong Kong and London share sixth place. Port-au-Prince (221) ranks at the bottom of the list.

‘In order for multinational companies to ensure their expatriates are compensated appropriately and an adequate hardship allowance is included in compensation packages, they must be aware of current events and local circumstances’, said Slagin Parakatil, Senior Researcher. 'Factors such as internal stability, law enforcement effectiveness, crime levels and medical facilities are important to consider when deciding on an international assignment, and the impact on daily life that could be encountered by the expatriate in overseas placements.'

Mr. Parakatil continued, ‘Infrastructure has a significant effect on the quality of living that expatriates experience. While often taken for granted when functioning to a high standard, a city's infrastructure can generate severe hardship when it is deficient. Companies need to provide adequate allowances to compensate their international workers for these and other hardships’.

Europe Europe has 15 cities among the world's top 25 cities for quality of living. Vienna retains the highest-ranking for both the region and globally. The rest of the top 10 for Europe are dominated by German and Swiss cities, with three cities each in the top 10. Zurich (2) is followed by Munich (4), Düsseldorf (6), Frankfurt (7), Geneva (8), Copenhagen (9) and Bern (10). The lowest-ranking Western European cities are Athens (83) and Belfast (64).

Other European cities among the top 25 include Amsterdam (12), Berlin (16), Hamburg (17), Luxembourg (19), Stockholm (19), Brussels (22) Nürnberg (24) and Stuttgart (27). Paris ranks 29 and is followed by Helsinki (32), Oslo (32) and London (38). Dublin dropped nine places from last year to rank 35, mostly due to a combination of serious flooding and an increase in crime rates. Lisbon ranks 44 followed by Madrid (49) and

Rome (52). Prague, Czech Republic (69) is the highest-ranking Eastern European city followed by Budapest, Hungary (74); Ljubljana, Slovenia (75); Vilnius, Lithuania (79); and Warsaw, Poland (84). The lowest-ranking European city is Tbilisi, Georgia (213).

Overall, European cities continue to have high quality of living as a result of a combination of increased stability, rising living standards and advanced city infrastructures, said Mr. Parakatil. 'But economic turmoil, political tension and high unemployment in some European countries and high levels of unemployment have continued to be problematic in the region.'

With six cities in the top 10, European cities also fare well in the city infrastructure ranking. Frankfurt and Munich rank the highest at second place, followed by Copenhagen (4) and Düsseldorf (5). London (6) and Hamburg (9) are followed by Paris which ranks 12. Budapest (67) is the highest-ranking for city infrastructure in Eastern Europe followed by Vilnius (74) and Prague (75), whereas Yerevan (189) and Tbilisi (201) rank lowest.

Infrastructure in German and Danish cities is among the best in the world, in part due to their first-class airport facilities, international and local connectivity, and a high standard of public services, said Mr. Parakatil. London's high ranking in the infrastructure index reflects a combination of high level of public services offered, with its extensive public transportation system including airports, the London Underground buses and railroad services.

Americas Canadian cities still dominate the top of the index for this region, with Vancouver (5) retaining the top regional spot, followed by Ottawa (14), Toronto (15) and Montreal (23). Calgary ranks 32 on the overall quality of living ranking. Overall, there was almost no movement in rankings among Canadian cities from 2011 to 2012, with Calgary advancing one position, Montreal retreating one position, and the other cities remaining unchanged.

Honolulu (28) is the city in the United States with the highest quality of living, Winter International HR Adviser

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2012 1 2 3 4 5 6 7 8 9 10 10 12 13 14 15 16 17 17 19 19 21 22 23 24 25 26 27 28 29 29 29 32 32 32 35 35 37 38 39 40 41 42 43 44 44 44 44 48 49 49 49 52 52 54 55 56 57 58 58 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 75 75 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 100

Rank

Mercer Quality of Living Survey  Worldwide Rankings, 2012 2011 1 2 3 4 5 5 7 8 9 9 11 12 13 14 15 17 16 18 19 20 21 22 22 24 25 26 28 29 30 30 30 33 35 33 36 26 37 38 39 40 42 43 43 41 47 48 46 49 43 49 49 52 52 54 56 54 57 61 58 59 60 62 63 63 65 66 67 68 69 70 71 72 74 73 75 80 77 78 79 76 81 82 83 84 85 86 87 89 88 91 90 92 93 94 95 95 97 98 99 101

City

VIENNA ZURICH AUCKLAND MUNICH VANCOUVER DÜSSELDORF FRANKFURT GENEVA COPENHAGEN BERN SYDNEY AMSTERDAM WELLINGTON OTTAWA TORONTO BERLIN HAMBURG MELBOURNE LUXEMBOURG STOCKHOLM PERTH BRUSSELS MONTREAL NÜRNBERG SINGAPORE CANBERRA STUTTGART HONOLULU, HI ADELAIDE PARIS SAN FRANCISCO, CA CALGARY HELSINKI OSLO BOSTON, MA DUBLIN BRISBANE LONDON LYON BARCELONA MILAN CHICAGO, IL WASHINGTON, DC LISBON NEW YORK CITY, NY SEATTLE, WA TOKYO KOBE MADRID PITTSBURGH, PA YOKOHAMA BIRMINGHAM ROME PHILADELPHIA, PA GLASGOW ABERDEEN OSAKA LEIPZIG LOS ANGELES, CA MINNEAPOLIS, MN NAGOYA DALLAS, TX POINTE-À-PITRE BELFAST HOUSTON, TX MIAMI, FL ST. LOUIS, MO ATLANTA, GA PRAGUE HONG KONG DETROIT, MI SAN JUAN DUBAI BUDAPEST LJUBLJANA SEOUL MONTEVIDEO ABU DHABI VILNIUS KUALA LUMPUR BUENOS AIRES PORT LOUIS ATHENS WARSAW TAIPEI BRATISLAVA LIMASSOL TALLINN CAPE TOWN RIGA SANTIAGO BUSAN PANAMA CITY JOHANNESBURG SHANGHAI VICTORIA BANDAR SERI BEGAWAN ZAGREB TEL AVIV JOHOR BAHRU

Country

AUSTRIA SWITZERLAND NEW ZEALAND GERMANY CANADA GERMANY GERMANY SWITZERLAND DENMARK SWITZERLAND AUSTRALIA NETHERLANDS NEW ZEALAND CANADA CANADA GERMANY GERMANY AUSTRALIA LUXEMBOURG SWEDEN AUSTRALIA BELGIUM CANADA GERMANY SINGAPORE AUSTRALIA GERMANY UNITED STATES AUSTRALIA FRANCE UNITED STATES CANADA FINLAND NORWAY UNITED STATES IRELAND AUSTRALIA UNITED KINGDOM FRANCE SPAIN ITALY UNITED STATES UNITED STATES PORTUGAL UNITED STATES UNITED STATES JAPAN JAPAN SPAIN UNITED STATES JAPAN UNITED KINGDOM ITALY UNITED STATES UNITED KINGDOM UNITED KINGDOM JAPAN GERMANY UNITED STATES UNITED STATES JAPAN UNITED STATES GUADELOUPE UNITED KINGDOM UNITED STATES UNITED STATES UNITED STATES UNITED STATES CZECH REPUBLIC HONG KONG UNITED STATES PUERTO RICO UNITED ARAB EMIRATES HUNGARY SLOVENIA SOUTH KOREA URUGUAY UNITED ARAB EMIRATES LITHUANIA MALAYSIA ARGENTINA MAURITIUS GREECE POLAND TAIWAN SLOVAKIA CYPRUS ESTONIA SOUTH AFRICA LATVIA CHILE SOUTH KOREA PANAMA SOUTH AFRICA CHINA SEYCHELLES BRUNEI CROATIA ISRAEL MALAYSIA

followed by San Francisco (29) and Boston (35). Chicago is at 42 and Washington, DC ranks 43. New York the base city ranks 44. In Central and South America, Pointe-à-Pitre, Guadeloupe ranks the highest for quality of living at 63. San Juan, Puerto Rico follows at 72 and Montevideo, Uruguay at 77. Port-au-Prince, Haiti (219) ranks lowest in the region.

Mr. Parakatil said, Overall, there has been little change in the rankings for North American cities. A number of South and Central American countries International HR Adviser Winter

101 102 103 104 105 106 107 108 109 109 111 112 113 114 115 115 117 118 119 120 121 122 123 124 125 126 127 128 129 130 130 132 133 134 135 135 137 138 139 140 141 142 143 143 145 146 147 148 149 150 151 151 153 154 155 156 157 158 158 160 161 162 163 164 165 166 167 168 169 170 171 172 173 174 175 176 177 178 179 180 181 182 183 184 185 186 187 188 188 190 191 192 193 194 195 196 197 198 199 200 201 202 203 204 205 206 207 208 209 210 211

100 101 101 104 105 106 107 108 109 110 112 114 110 115 121 116 117 119 120 121 118 123 124 126 124 113 127 128 129 130 134 132 131 137 136 139 137 140 141 142 135 154 144 143 146 144 147 147 149 150 151 152 152 163 155 156 157 158 161 159 160 162 165 132 181 166 169 164 172 168 170 171 167 173 177 174 174 176 178 179 184 183 182 189 186 184 188 190 187 191 194 193 192 195 196 202 179 198 199 200 200 203 204 206 205 207 208 209 197 210 213

NOUMEA BRASILIA MUSCAT MONTERREY SAN JOSÉ DOHA BUCHAREST NASSAU BEIJING TUNIS ASUNCION RIO DE JANEIRO SOFIA RABAT BANGKOK SÃO PAULO ISTANBUL GUANGZHOU KUWAIT CITY MEXICO CITY LIMA CASABLANCA WINDHOEK AMMAN QUITO MANAMA CHENGDU MANILA SANTO DOMINGO BOGOTÃ NANJING SHENZHEN GABORONE LUSAKA BELGRADE COLOMBO QINGDAO JAKARTA BANGALORE GUATEMALA CITY CAIRO PORT OF SPAIN KINGSTON NEW DELHI SHENYANG MUMBAI HANOI LA PAZ HO CHI MINH CITY CHENNAI KOLKATA SKOPJE DAKAR MOSCOW SARAJEVO LIBREVILLE RIYADH ACCRA KIEV JEDDAH JILIN KAMPALA ST. PETERSBURG BLANTYRE MAPUTO MANAGUA VIENTIANE CARACAS ALMATY SAN SALVADOR BEIRUT COTONOU BANJUL YEREVAN TEGUCIGALPA TIRANA NAIROBI DJIBOUTI ALGIERS ISLAMABAD KIGALI YAOUNDÉ MINSK HAVANA PHNOM PENH DOUALA DAR ES SALAAM LAHORE TEHRAN KARACHI LUANDA LOMÉ HARARE BAKU YANGON TRIPOLI DAMASCUS TASHKENT ASHKHABAD OUAGADOUGOU ADDIS ABABA LAGOS DHAKA BISHKEK ABUJA NIAMEY DUSHANBE ANTANANARIVO BAMAKO CONAKRY ABIDJAN

NEW CALEDONIA BRAZIL OMAN MEXICO COSTA RICA QATAR ROMANIA BAHAMAS CHINA TUNISIA PARAGUAY BRAZIL BULGARIA MOROCCO THAILAND BRAZIL TURKEY CHINA KUWAIT MEXICO PERU MOROCCO NAMIBIA JORDAN ECUADOR BAHRAIN CHINA PHILIPPINES DOMINICAN REPUBLIC COLOMBIA CHINA CHINA BOTSWANA ZAMBIA SERBIA SRI LANKA CHINA INDONESIA INDIA GUATEMALA EGYPT TRINIDAD & TOBAGO JAMAICA INDIA CHINA INDIA VIETNAM BOLIVIA VIETNAM INDIA INDIA MACEDONIA SENEGAL RUSSIA BOSNIA-HERZEGOVINA GABON SAUDI ARABIA GHANA UKRAINE SAUDI ARABIA CHINA UGANDA RUSSIA MALAWI MOZAMBIQUE NICARAGUA LAOS VENEZUELA KAZAKHSTAN EL SALVADOR LEBANON BENIN GAMBIA ARMENIA HONDURAS ALBANIA KENYA DJIBOUTI ALGERIA PAKISTAN RWANDA CAMEROON BELARUS CUBA CAMBODIA CAMEROON TANZANIA PAKISTAN IRAN PAKISTAN ANGOLA TOGO ZIMBABWE AZERBAIJAN MYANMAR LIBYA SYRIA UZBEKISTAN TURKMENISTAN BURKINA FASO ETHIOPIA NIGERIA BANGLADESH KYRGYZSTAN NIGERIA NIGER TAJIKISTAN MADAGASCAR MALI GUINEA CÔTE D'IVOIRE DEMOCRATIC REP. OF THE CONGO MAURITANIA GEORGIA CONGO YEMEN SUDAN CHAD HAITI CENTRAL AFRICAN REPUBLIC IRAQ

have experienced positive change, essentially due to some modest infra212 211and

KINSHASA

structural recreational improvement.

213 212 NOUAKCHOTT 213 214 TBILISI

Nevertheless, political and security issues, 215 214 BRAZZAVILLE 216 216 SANA'A along with natural disasters, continue to 217 217 KHARTOUM 218 219 N'DJAMENA hamper the of living in South and 219 218 quality PORT-AU-PRINCE

220 220 BANGUI Central American High crime lev221 221 BAGHDADcities.

els also remain a major problem.

In terms of city infrastructure, Vancouver (9) tops the ranking for the region with Atlanta and Montreal following at 13. Other Canadian cities that ranked highly were Toronto (16) and Ottawa

193 194 195 196 197 198 199 200 201 202 203 204 205 206 207 208 209 210 211

192 195 196 202 179 198 199 200 200 203 204 206 205 207 208 209 197 210 213

HARARE BAKU YANGON TRIPOLI DAMASCUS TASHKENT ASHKHABAD OUAGADOUGOU ADDIS ABABA LAGOS DHAKA BISHKEK ABUJA NIAMEY DUSHANBE ANTANANARIVO BAMAKO CONAKRY ABIDJAN

212 213 213 215 216 217 218 219 220 221

211 212 214 214 216 217 219 218 220 221

KINSHASA NOUAKCHOTT TBILISI BRAZZAVILLE SANA'A KHARTOUM N'DJAMENA PORT-AU-PRINCE BANGUI BAGHDAD

ZIMBABWE AZERBAIJAN MYANMAR LIBYA SYRIA UZBEKISTAN TURKMENISTAN BURKINA FASO ETHIOPIA NIGERIA BANGLADESH KYRGYZSTAN NIGERIA NIGER TAJIKISTAN MADAGASCAR MALI GUINEA CÔTE D'IVOIRE DEMOCRATIC REP. OF THE CONGO MAURITANIA GEORGIA CONGO YEMEN SUDAN CHAD HAITI CENTRAL AFRICAN REPUBLIC IRAQ

(25). In the United States, Dallas ranked 15, followed by Washington, DC (22), Chicago (28) and New York (30). Buenos Aires, Argentina (83) has the best city infrastructure in Central and South America, whereas Port-au-Prince is the lowest ranking at 221.

Asia Pacific Auckland (3) retains its position as the highest-ranking city for quality of living in the region. Sydney follows at 10, Wellington at 13, Melbourne at 17 and Perth at 21. Singapore remains the highest-ranking Asian city at 25 followed by Japanese cities Tokyo (44), Kobe (48), Yokohama (49) and Osaka (57). Hong Kong (70), Seoul (75), Kuala Lumpur (80), Taipei (85) and Shanghai (95) are other major Asian cities ranked in the top 100. The region's lowest-ranking cities are Dhaka, Bangladesh (203); Bishkek, Kyrgyzstan (204); and Dushanbe, Tajikistan (207).

For city infrastructure, Singapore has the highest ranking worldwide followed

by Hong Kong (6), Sydney (8), Perth (25), Tokyo (32) and Melbourne (34).

Adelaide and Brisbane both ranked 37.

Nagoya (41), Auckland (43), Kobe (44), Wellington (48), Seoul (50) and Osaka (51) are the next highest-ranking cities in this region. The region's lowest-ranking city for city infrastructure is Dhaka, Bangladesh (205).

A noticeable gap can be seen among Asia Pacific cities where several cities have improved in the region partly because they have been investing massively in infrastructure and public services, said Mr. Parakatil. Competition among municipalities has been continuously increasing in order to attract multinationals, foreigners, expatriates and tourists. Yet a considerable number of Asian cities rank in the bottom quartile, mainly due to high political volatility, poor infrastructure and obsolete public services.

Middle East and Africa Dubai (73) and Abu Dhabi (78) in the United Arab Emirates are the region's cities with the best quality of living. Port

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Rank 1 2 2 4 5 6 6 8 9 9 11 12 13 13 15 16 16 18 18 18 18 22 23 24 25 25 25 28 29 30 31 32 33 34 34 34 37 37 37 40 41 42 43 44 44 44 47 48 48 50 51 51 51 51 55 56 57 58 59 60 60 62 63 64 65 65 67 67 69 69 71 72 72 74 75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 100 101 102 103 104 105 106 107 108 109 110 111 112 113 113 115 116 117 118 119 120 121 122 123 124 125

Mercer City Infrastructure Ranking, 2012* City Country SINGAPORE SINGAPORE FRANKFURT GERMANY MUNICH GERMANY COPENHAGEN DENMARK DÜSSELDORF GERMANY HONG KONG HONG KONG LONDON UNITED KINGDOM SYDNEY AUSTRALIA HAMBURG GERMANY VANCOUVER CANADA YOKOHAMA JAPAN PARIS FRANCE ATLANTA, GA UNITED STATES MONTREAL CANADA DALLAS, TX UNITED STATES TORONTO CANADA VIENNA AUSTRIA HELSINKI FINLAND OSLO NORWAY STOCKHOLM SWEDEN STUTTGART GERMANY WASHINGTON, DC UNITED STATES AMSTERDAM NETHERLANDS ZURICH SWITZERLAND BERN SWITZERLAND OTTAWA CANADA PERTH AUSTRALIA CHICAGO, IL UNITED STATES BERLIN GERMANY NEW YORK CITY, NY UNITED STATES BOSTON, MA UNITED STATES TOKYO JAPAN NÜRNBERG GERMANY DUBAI UNITED ARAB EMIRATES MADRID SPAIN MELBOURNE AUSTRALIA ADELAIDE AUSTRALIA BRISBANE AUSTRALIA PHILADELPHIA, PA UNITED STATES HONOLULU, HI UNITED STATES NAGOYA JAPAN BRUSSELS BELGIUM AUCKLAND NEW ZEALAND BIRMINGHAM UNITED KINGDOM GLASGOW UNITED KINGDOM KOBE JAPAN GENEVA SWITZERLAND MIAMI, FL UNITED STATES WELLINGTON NEW ZEALAND SEOUL SOUTH KOREA HOUSTON, TX UNITED STATES MILAN ITALY OSAKA JAPAN SEATTLE, WA UNITED STATES SAN FRANCISCO, CA UNITED STATES CANBERRA AUSTRALIA BARCELONA SPAIN TEL AVIV ISRAEL MINNEAPOLIS, MN UNITED STATES CALGARY CANADA LEIPZIG GERMANY DUBLIN IRELAND PITTSBURGH, PA UNITED STATES DETROIT, MI UNITED STATES LOS ANGELES, CA UNITED STATES ST. LOUIS, MO UNITED STATES BUDAPEST HUNGARY LYON FRANCE ABERDEEN UNITED KINGDOM BELFAST UNITED KINGDOM LUXEMBOURG LUXEMBOURG ABU DHABI UNITED ARAB EMIRATES ROME ITALY VILNIUS LITHUANIA PRAGUE CZECH REPUBLIC LISBON PORTUGAL KUALA LUMPUR MALAYSIA TAIPEI TAIWAN BANDAR SERI BEGAWAN BRUNEI BRATISLAVA SLOVAKIA JOHOR BAHRU MALAYSIA TALLINN ESTONIA BUENOS AIRES ARGENTINA BUSAN SOUTH KOREA RIGA LATVIA SHANGHAI CHINA SAN JUAN PUERTO RICO WARSAW POLAND SANTIAGO CHILE POINTE-À-PITRE GUADELOUPE PORT LOUIS MAURITIUS LJUBLJANA SLOVENIA BEIJING CHINA MUSCAT OMAN CAIRO EGYPT MONTEVIDEO URUGUAY CAPE TOWN SOUTH AFRICA RIO DE JANEIRO BRAZIL ATHENS GREECE BANGKOK THAILAND BRASILIA BRAZIL DOHA QATAR TUNIS TUNISIA ISTANBUL TURKEY LIMASSOL CYPRUS VICTORIA SEYCHELLES LIMA PERU MONTERREY MEXICO PANAMA CITY PANAMA MANAMA BAHRAIN JOHANNESBURG SOUTH AFRICA BUCHAREST ROMANIA KUWAIT CITY KUWAIT NOUMEA NEW CALEDONIA ZAGREB CROATIA SÃO PAULO BRAZIL NANJING CHINA CHENGDU CHINA RIYADH SAUDI ARABIA MANILA PHILIPPINES CASABLANCA MOROCCO QUITO ECUADOR MOSCOW RUSSIA NASSAU BAHAMAS GUANGZHOU CHINA

Louis in Mauritius (82), Cape Town (89) and Johannesburg (94) follow, and along with Victoria in the Seychelles (96) and Tel

126 127 128 129 130 131 132 133 134 135 136 137 138 139 140 141 142 143 144 144 146 146 146 149 150 151 152 153 153 155 156 157 158 158 160 161 162 163 164 165 165 167 168 169 170 171 172 173 174 175 176 177 178 179 180 180 182 183 184 185 185 187 188 189 189 191 192 192 194 195 196 197 198 199 200 201 201 203 204 205 206 207 208 209 210 211 212 213 214 215 216 217 218 219 220 221

COLOMBO MEXICO CITY BOGOTÃ ASUNCION JEDDAH JAKARTA SHENZHEN BELGRADE MUMBAI SKOPJE SAN JOSÉ HO CHI MINH CITY SANTO DOMINGO RABAT SOFIA KOLKATA ISLAMABAD CARACAS GABORONE GUATEMALA CITY HANOI KIEV TEHRAN VIENTIANE LA PAZ SHENYANG QINGDAO NEW DELHI PORT OF SPAIN KINGSTON JILIN WINDHOEK AMMAN KARACHI ST. PETERSBURG TRIPOLI LIBREVILLE MINSK SARAJEVO LAHORE SAN SALVADOR DJIBOUTI CHENNAI DAKAR BANGALORE HARARE ALMATY NAIROBI COTONOU BLANTYRE ACCRA LUSAKA ASHKHABAD TEGUCIGALPA TIRANA YANGON TASHKENT DOUALA DAMASCUS BANJUL LOMÉ HAVANA DAR ES SALAAM NIAMEY YEREVAN MAPUTO ALGIERS KINSHASA PHNOM PENH KAMPALA ABIDJAN MANAGUA BISHKEK BAKU DUSHANBE LUANDA TBILISI YAOUNDÉ BEIRUT DHAKA ADDIS ABABA NOUAKCHOTT N'DJAMENA OUAGADOUGOU KHARTOUM BAMAKO ANTANANARIVO BANGUI LAGOS ABUJA CONAKRY KIGALI BRAZZAVILLE SANA'A BAGHDAD PORT-AU-PRINCE

SRI LANKA MEXICO COLOMBIA PARAGUAY SAUDI ARABIA INDONESIA CHINA SERBIA INDIA MACEDONIA COSTA RICA VIETNAM DOMINICAN REPUBLIC MOROCCO BULGARIA INDIA PAKISTAN VENEZUELA BOTSWANA GUATEMALA VIETNAM UKRAINE IRAN LAOS BOLIVIA CHINA CHINA INDIA TRINIDAD & TOBAGO JAMAICA CHINA NAMIBIA JORDAN PAKISTAN RUSSIA LIBYA GABON BELARUS BOSNIA-HERZEGOVINA PAKISTAN EL SALVADOR DJIBOUTI INDIA SENEGAL INDIA ZIMBABWE KAZAKHSTAN KENYA BENIN MALAWI GHANA ZAMBIA TURKMENISTAN HONDURAS ALBANIA MYANMAR UZBEKISTAN CAMEROON SYRIA GAMBIA TOGO CUBA TANZANIA NIGER ARMENIA MOZAMBIQUE ALGERIA DEMOCRATIC REP. OF THE CONGO CAMBODIA UGANDA CÔTE D'IVOIRE NICARAGUA KYRGYZSTAN AZERBAIJAN TAJIKISTAN ANGOLA GEORGIA CAMEROON LEBANON BANGLADESH ETHIOPIA MAURITANIA CHAD BURKINA FASO SUDAN MALI MADAGASCAR CENTRAL AFRICAN REPUBLIC NIGERIA NIGERIA GUINEA RWANDA CONGO YEMEN IRAQ HAITI

*Mercer s City Infrastructure Ranking 2012 is based on measures of: Electricity, Water Availability, Telephone, Mail, Public Transportation, Traffic Congestion & Airport Effectiveness.

Aviv (99), are the region's only other cities in the top 100. This region has 15 cities in the bottom 20, including Lagos, Nigeria (202); Bamako, Mali (209); Khartoum, Sudan (217); and N Djamena, Chad (218). Baghdad, Iraq (221) is the lowestranking city both regionally and globally.

In the city infrastructure index, most of the region's cities rank below 100.

The exceptions are Dubai (34), which ranks the highest in the region for city infrastructure, Tel Aviv (58), Abu Dhabi (72), Port Louis (91), Muscat (94), Cairo

(95) and Cape Town (97). Port Louis, Cairo and Cape Town are the only African cities in the top 100. Elsewhere in the region, Doha, Qatar is at 102, Tunis, Tunisia, ranks 103 and Manama, Bahrain is at 110. In terms of city infrastructure, Baghdad, Iraq (220) is the lowest-ranking city regionally, along with Sana a, Yemen (219); Brazzaville, Congo (218); Kigali, Rwanda (217); and Abuja, Nigeria (215).

The ongoing turmoil in many countries across North Africa and the Middle East has led to serious security issues for locals and expatriates, said Mr. Parakatil.

Many countries continue to experience violence through political demonstrations that have sometimes developed into massive uprisings and led to serious instability within the region. Countries such as Syria and Mali have seen their quality of living levels drop substantially. Employers should continually monitor the situation in these countries, as circumstances can degrade rapidly. Companies need to be able to proactively implement mitigation plans, such as emergency repatriation, or adjust expatriate compensation packages accordingly.

Expatriates in difficult locations: Determining appropriate allowances and incentives Companies need to be able to determine their expatriate compensation packages rationally, consistently and systematically.

Providing incentives to reward and recognise the efforts that employees and their families make when taking on international assignments remains a typical practice, particularly for difficult locations. Two common incentives include a quality-of-living allowance and a mobility premium.

• Quality-of-living or hardship allowances compensate expatriates for decreases in the quality of living between their home and host locations.

• By contrast, a mobility premium simply compensates for the inconvenience of being uprooted and having to work in another country.

A quality-of-living allowance is typically location-related while a mobility premium is usually independent of the host location. Some multinational companies combine these premiums, but the vast majority provides them separately.

Quality of Living: City Benchmarking Mercer also helps municipalities assess Winter International HR Adviser

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survey factors that can improve their quality-ofliving rankings. In a global environment, employers have many choices of where to deploy their mobile employees and set up new business. Thus, a city's quality-ofliving standards can be an important variable for employers to consider.

Leaders in many cities want to understand the specific factors that affect their residents quality of living and address those issues that affect their city's overall quality-of-living ranking. Mercer advises municipalities through a holistic approach that addresses their goals of progressing towards excellence and attracting multinational companies and globally mobile talent by improving the elements that get measured in our Quality of Living metrics.

Mercer hardship allowance recommendations Mercer evaluates local living conditions in more than 460 cities it surveys worldwide.

We analyse living conditions according to 39 factors, grouped in 10 categories:

International HR Adviser Winter

• Political and social environment (political stability, crime, law enforcement) • Economic environment (currency exchange regulations, banking services) • Socio-cultural environment (censorship, limitations on personal freedom) • Medical and health considerations (medical supplies and services, infectious diseases, sewage, waste disposal, air pollution, etc.)

• Schools and education (standard and availability of international schools) • Public services and transportation (electricity, water, public transportation, traffic congestion, etc.)

• Recreation (restaurants, theatres, movie theatres, sports and leisure, etc.)

• Consumer goods (availability of food/ daily consumption items, cars, etc.)

• Housing (rental housing, household appliances, furniture, maintenance services) • Natural environment (climate, record of natural disasters).

The scores attributed to each factor allow

for city-to-city comparisons. The result is a quality-of-living index that compares relative differences between any two locations that we evaluate. For the indices to be used effectively, Mercer has created a grid that allows users to link the resulting index to a quality-of-living allowance amount by recommending a percentage value in relation to the index. www.mercer.com.www.mercer.com.

Have you renewed your free annual subscription to International HR Adviser?

If not, please email your details to helen@internationalhradviser.com or complete and return the enclosed free annual subscription card. The current campaign is sponsored by

The 2013 Corporate Relocation Conference & Exhibition

Monday 4th February, Hotel Russell, Russell Square, Bloomsbury, London, WC1B 5BE

FREE SEMINAR PROGRAMME Chaired by Martin Humphrys, Humphrys’ Education Winner of Relocation Personality of the Year 2009

10.30am — Third Culture Kids - Raising Portable Children

There are many challenges associated with an international move, and how global mobility impacts children is a concern for many families. This session on Third Culture Kids will discuss what research tells us about these unique youngsters and how we can best support them during this lifechanging experience. This session is for parents, but also educators, human resources and relocation professionals who want to understand more about raising and educating children abroad.

Presented by Mary Langford, an independent international education consultant, who has over 30 years experience working in international schools with families of many nationalities. As a TCk who spent a transient childhood in Europe, the USA and Latin America, her personal insights and professional experience make her a strong believer in the many advantages gained by internationally-mobile children when they are supported by parents and schools.

11.30am — I’m Settled....What’s Next? - A Focus On Long-Term Relocation Support

Often all of the attention is placed on the first few weeks of an international move. Join FOCUS to learn the longer-term support factors which have been proven to ensure a successful relocation for the whole family. Presented by FOCUS.

12.30pm — Tax Planning Tips For Expatriates

Imperative tax issues for foreign nationals living in the UK including understanding the UK tax system as it applies to a non-UK national, choosing between the remittance and arising basis of taxation, maximising foreign tax credits and dealing with investment considerations”.

Presented by Frank Hirth.

2.00pm — Global Immigration

This seminar will be a practical session providing advice on the latest Immigration developments and the implications for businesses and will cover: Immigration Policies Updates, Global Immigration Management, Compliance and Risk Management, and United Kingdom Sponsor Licencing and Management.

If you have an immigration enquiry that you would like our consultants to cover on the day please email your enquiry in advance to fs@fergusonsnell.co.uk. Presented by Ferguson Snell.

3.00pm — How Do You Apply Procurement Practices To Mobility?

Procurement in the mobility industry can be a complex task, as the concept of supplier management is in its infancy when compared to industries such as technology or retail.

SIRVA utilises proven procurement principles that are the foundation of this presentation. As we walk through each step in the process, we provide best practices as well as examples that will simplify the application of procurement to mobility management.

4.00pm — Payroll Compliance For Mobile Employees

As the pressure on internal and external compliance gets greater, the challenges of reporting compensation data for international assignees, in particular relocation expenses and third party vendor expenses, get no easier. Data is invariable embedded in multiple data sources, often in different locations. At the seminar we will discuss what the reporting requirements are, what challenges are faced by organisations and explain some of the ways in which companies are deploying global processes to collect and report relocation expenses and third party vendor expenses.

Presented by Deloitte LLP.

Places at these seminars are free, but visitors must pre-register as there is limited availability.

To register your place for any or all of these seminars, please email helen@theamericanhour.com or telephone Helen Elliott on 020 8661 0186 We look forward to seeing you there.

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immigration

Is The UK Border Agency Increasingly Looking To Support Compliant Businesses?

Last night I went to bed thinking about writing a positive article for International HR Adviser about how the UK Border Agency’s focus on business has improved in the last few months. This morning I had a quick rethink when I opened the BBC news site and was immediately confronted by the headline “UKBA service 'shockingly poor'”.

The article focused on unresolved asylum cases. While it is not my place to comment on those matters, I can say that in my own area, corporate immigration, it would be churlish not to acknowledge a welcome increase in policy and operational support for business.

For quite some time officials in the Home Office and UKBA have been working away, looking at how they support business through policies and process. There is work to be done of course, but a number of recent changes show that progress is being made.

I will begin by looking at policy. On 22 November the Home Office announced three changes to Tier 2 policy – the visa category for skilled non-EU workers – that will all help businesses and rationalise the system. These changes took effect on 13 December 2012.

Tier 2 is made up of two key parts. Tier 2 Intra-Company Transfer (ICT) enables multinational businesses to move experienced staff to the UK to take on project, leadership and development roles. Tier 2 General allows a business to recruit a nonEU worker permanently where they cannot find a suitably skilled resident worker.

The first change will help the best paid ICTs stay in the UK for a longer period of time. Since April 2011 an ICT sent to the UK on assignment has been entitled to a maximum five years stay in the UK. By and large this is not a problem for business; ICTs are temporary assignees and will often stay for no more than two or three years. That is not always true for senior managers, particularly those transferred to run business areas. This is especially true where the assignee is entering from a company in Japan, the US and Canada, among other countries. Big projects take time and five years may not be sufficient. Product lines can often run for over five years too.

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The Home Office has balanced this very real business need with the desire to restrict migration by allowing ICTs paid over £150,000 to stay in the UK for up to nine years. We would inevitably prefer this policy to extend to every ICT but it would be churlish to overlook the very welcome benefit that this tempered relaxation of policy provides.

The second policy change is a rationalisation of the cooling off period. This rule prevents most Tier 2 workers from returning to work in the UK for 12 months from the point that their Tier 2 visa expires.

The rule itself is not well liked by businesses but it’s intention is reasonably clear.

The administration has provided less certainty, a point that the Home Office has sought to address in the Immigration Rules.

When introduced, the legislation giving effect to the cooling off period stated that the 12 month exclusion would begin from the point a visa expires or is cancelled.

When a visa naturally expires the point at which the cooling off period began was clear – it is the date on your visa.

Where an individual left the UK before the expiry of their visa the cooling off period could not begin until the visa had been cancelled by the UK Border Agency. This might have been the case where an assignee was granted a three year visa only for a project to end prematurely after a year.

Due process, for instance notifying the migrant worker, dictates that it generally takes around four months for a visa to be cancelled. This essentially extends the cooling off period to 16 months, causing additional frustration for businesses.

This issue has been resolved by the new policy. Tier 2 workers who have left the UK prematurely will no longer have to wait for their visa to be cancelled before the cooling off period kicks in. Instead, they will be able to return to the UK to work 12 months from the point that they can demonstrate that they ended their employment in the UK and left the country.

This change may be technical, but it will vastly increase certainty for businesses and make for a much more rationally operated system.

The final change is a generous relaxation of policy that will help all Tier 2 General workers. At present a Tier 2 General

worker will normally need to have spent no more than 180 days outside of the UK in the five years preceding their application, so an average of 36 days a year. The UKBA does apply a sensible degree of discretion to applications from frequent business travellers, but relying on the discretion of a faceless caseworker will never give an applicant complete confidence.

The policy has been overhauled and from 13 December 2012 applicants will be able to spend up to 180 days per year outside of the UK. This allowance is five times higher than that in existing policy guidance. Moreover, the policy will apply to all applicants, not just the high earners that are favoured elsewhere in guidance.

In practice the tangible benefit of the change may be low. Solicitors at Fragomen and other law firms have an excellent track record in convincing the UKBA to apply discretion and grant settlement to frequent travellers. All that said, by relaxing the rules it will now be far clearer where a person does and does not qualify for settlement.

This will make a great deal of difference for applicants. Having spent at least five years making a home in the UK, the three to six months wait for a settlement visa is an anxious time for an applicant; even applicants who are able to get a same day appointment will worry about the decision. For the individual applicant, simply knowing that they won’t have spent all of that time working in and contributing to the UK, only to be tripped up by absences, will be a weight off their minds.

This run of changes is uniquely business friendly and should be welcomed and encouraged. Every indication is that going forward the UKBA and Home Office are committed to continuing this trend by actively supporting the government’s wider economic growth agenda.

Officials do not need to be prompted to talk about supporting businesses.

Operationally speaking, the introduction of a priority postal service for incountry applications is another positive step. Applications are turned around in ten days and the team in charge are pragmatic and approachable. We really like this service and hope that it lasts beyond the pilot.

immigration Plans to improve customer services overseas, whether by standardising and improving priority services or increasing access to premium services are also encouraging.

Work to improve communications should also make a big difference.

We believe that changes to the business visit regime would go a long way towards making the system work better and more rationally for business. Business visit visas are only available for people who do not intend to work, aside from a small number of permitted activities. While there is sense in that, requiring an ICT visa if a migrant is entering to work for a week seems like overkill.

We also believe that there is scope for the rules around flexible working and compassionate leave to be brought in to line with normal business practice. Preventing a new mother from working part-time after maternity doesn’t seem fair. The need to cancel sponsorship where a person leaves for over a month to look after a sick or dying relative doesn’t feel right either.

Of course where there is a carrot you will invariably find a stick nearby. As committed as the UKBA is to supporting businesses, it will not tolerate wilful or other substantial non-compliance. Over the

last 12 months we have seen an upturn in UKBA audit and enforcement action.

By and large officials will work with businesses who have failed to comply despite best efforts. But, as has been clear from media reporting around universities, they will not shy away from taking action where they believe it is necessary.

Counter intuitively, this is actually another example of good customer service. When the UKBA cracks down on those who aren’t playing by the rules, they level the playing field for those who are.

As a former Home Office official I am always wary of appearing like an institutionalised apologist for the UKBA. The truth is that there is more to be done to support businesses and other users. It would be great, for instance, if passports could be returned immediately rather than having to post them to the Home Office for three months or more. We would also like to see greater access to fast track applications at home and abroad.

Change takes time in any large organisation so we cannot expect miracles over night. As first steps these policy and process changes will make a sizeable difference for business. They should be welcomed and encouraged.

Ian Robinson Ian is the Government Affairs Manager at Fragomen UK. Ian has eight years experience working on contentious migration and criminal justice policies for the UK's Home Office. Before joining Fragomen in 2011, he was Assistant Director in the UK Border Agency.

In January 2009, Ian took responsibility for the development and oversight of the UK's economic migration policy.

Most recently, Ian played a central role in the design and implementation of the UK's policy placing a cap on economic migrants. Ian also fronted an extensive Government consultation on the cap and worked with experts to revamp the UK's high value migration routes in Tier 1 of the PBS. Manager, London, UK T +44 (0) 20 3077 5059 irobinson@fragomen.com

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Global Immigration Update

Global Immigration Update United States December Visa Bulletin: EB-2 China Will Advance, But No Movement for EB-2 India (November 7, 2012) According to the US Department of State’s December visa bulletin, the EB-2 category will remain current for all countries except India and China next month.

The priority date cut-off for EB-2 India will once again remain unchanged at September 1, 2004. EB-2 for mainland China will advance seven weeks to October 22, 2007.

The EB-3 professional and skilled worker subcategory will advance by two and a half months for mainland China, to July 1, 2006; by one week for India, to November 1, 2002; and by one week for the Philippines, to August 15, 2006.

All other countries will advance by one month, to December 22, 2006.

December 2012 Priority Date CutOffs In December 2012, EB immigrant visa priority date cut-offs will be: EB-1 Current for all countries.

EB-2 China: October 22, 2007 India: September 1, 2004 All other countries: Current EB-3 Professionals and Skilled Workers China: July 1, 2006 India: November 1, 2002 Philippines: August 15, 2006 All other countries: December 22, 2006 EB-3 Other Workers China: July 1, 2003 India: November 1, 2002 Philippines: August 15, 2006 All other countries: December 22, 2006 EB-5 Current for all countries and subcategories.

Priority Date Projections for the Coming Months The December Visa Bulletin also contains the State Department’s projections for priority date movement over the next several months. EB-2 China is expected International HR Adviser Winter

to advance by five to eight weeks over the coming months. EB-2 India is likely to remain unchanged for some time. EB-2 worldwide is expected to remain current.

EB-3 worldwide could advance by three to five weeks; EB-3 China is expected to advance by one to two months; EB-3 India could advance by up to two weeks; and EB-3 for the Philippines is projected to advance by one to three weeks.

In the EB-5 category, a cut-off date could be imposed for China at some point during the second half of FY 2013 - a first for that preference category.

Belgium New Minimum Salary Requirements for Type “B” Work Permits Take Effect January 1 (November 8, 2012) Effective January 1, 2013, the minimum base salary for highly skilled foreign workers applying for Type “B” work permits will increase by approximately 2.5 percent to €38,665 from €37,721 per year. The minimum base salary for senior management and foreign nationals in executive-level positions will increase to €64,508 from €62,934 per year. Foreign nationals applying for work permits as trainees are exempt from minimum salary requirements.

The Ministry of Employment and Labor reviews minimum salary requirements for Belgian work permits on an annual basis. The requirements are generally enforced by the regional employment authorities where a work permit application is filed. Once the new salary requirements take effect on January 1, 2013, new work permit applications and work permit renewal applications that fail to demonstrate that the new minimums will be met will be rejected.

Employers should review the new minimum salary requirements with their immigration service providers prior to filing new or renewal applications for Type “B” work permits.

Singapore Government Raises Qualifying Criteria for Personalised Employment Passes (November 9, 2012) From December 1, 2012, foreign nationals applying for a Personalised Employment

Pass (PEP) will face salary requirements more than four times higher than current levels, among other changes. The Singapore government is implementing these changes to ensure that the PEP remains a premium pass for top-tier foreign talent working in Singapore.

Unlike the Employment Pass, the PEP is tied to the individual instead of a specific employer. The PEP allows the holder to remain in Singapore for up to six months in between jobs to evaluate new employment opportunities.

Increased Income Requirements Under the new criteria, the PEP will be available only to: (1) P1 Pass holders who earn a fixed monthly salary of at least S$12,000; and (2) overseas-based foreign professionals whose last drawn fixed monthly salary was at least S$18,000 and who have not been unemployed for a period of more than six consecutive months at the time of their PEP application. “Fixed salary” refers to the total payment made directly to an employee inclusive of basic salary, transport, housing and living allowances, while excluding variable compensation such as bonuses or commissions.

Foreign nationals who are issued a PEP under the new criteria will be required to earn a fixed annual salary of at least S$144,000 for each calendar year of the PEP. Currently, the minimum fixed annual salary for PEP holders is S$34,000.

Until November 30, the following foreign nationals remain eligible for the PEP: (1) P1 Pass holders; (2) former P1 Pass holders; (3) overseas-based foreign professionals whose last drawn fixed monthly salary was at least S$8,000; (4) P2 Pass holders who have held their pass for at least two years and earned a fixed salary of at least S$34,000 in the previous year; (5) Q Pass holders who have held their pass for at least five years and earned a fixed salary of at least S$34,000 in the previous year; and (6) foreign graduates from a Singaporean institute of higher learning who have held an employment pass for at least two years and earned a fixed salary of at least S$34,000 in the previous year.

PEP Validity Period; Sponsored Family Members From December 1, the government will

Global Immigration Update shorten the validity period of the PEP to three years, from the current five years.

The PEP will continue to be issued for a single, non-renewable term.

The new PEP rules will broaden dependent privileges for PEP holders, who will be able to bring in their spouse and children on Dependent Passes and their parents on Long Term Visit Passes, similar to the dependent privileges accorded to P1 Pass holders (earning at least S$8,000 monthly).

Current rules limit dependent privileges for some PEP holders, based on their salary level and the type of employment pass from which they converted to PEP. Transition Requirements for Current PEP Holders Current PEP holders who do not meet the revised minimum annual fixed salary requirement of S$144,000 will have until December 31, 2014 to do so. Otherwise, they will need to be approved for a different immigration status, such as permanent residence or a company-sponsored employment pass, in order to continue to work and live in Singapore. However, those whose PEP will expire between January 1, 2015 and June 30, 2015 will be exempt from the new salary requirement and will be allowed to stay in Singapore until their pass expires provided they continue to meet current PEP requirements.

Dependents of existing PEP holders who are in Singapore by December 1, 2012 will be allowed to stay so long as their sponsors have valid PEPs.

China Chinese Consular Posts in Germany Outsource Visa Services as Part of Worldwide Rollout (November 12, 2012) China’s consular posts in Germany are now outsourcing most visa processing to new China Visa Application Service Centres (CVASCs) located throughout Germany. As a result, applicants for Chinese business visas must submit their applications to CVASCs instead of Chinese diplomatic posts. Consular posts have stopped accepting business visa applications directly. However, posts continue to accept applications for Hong Kong and Macao visas and entry permits.

There are CVASC locations in Berlin, Frankfurt, Hamburg and Munich.

CVASCs accept paper application forms, and they also offer an online application form on their website. Forms completed

online must be printed and, like the paper version of the form, included with the rest of the required application materials, which applicants may submit to the CVASCs either in person or by mail.

Applicants have the option of scheduling appointments to submit their applications in person to reduce waiting time, although they are not required to do so.

Outsourcing is not expected to impact Chinese visa processing times in Germany, though it has increased the cost of visas, as the CVASC charges a service fee in addition to the standard visa application fee.

The new procedures are the latest step in China’s plan to eventually phase out direct visa processing by its consular posts.

Similar arrangements with the CVASC have been implemented at consular posts in a number of countries, including Australia, India, and Singapore. There are reports that posts in the United States are considering outsourcing visa services to the CVASC, though no official plans have been announced.

In other jurisdictions where Chinese consular posts have already outsourced their visa services, applicants have found that the CVASC provides clearer guidance that is easier to find and is more responsive to email inquiries than the consular posts have been.

Brazil Nationals of 25 EU Countries No Longer Eligible to Extend Business or Tourist Stays (November 15, 2012) Nationals of 25 European Union countries can no longer extend tourist or business stays in Brazil; they are now subject to a maximum stay of 90 days within a 180-day period, under a new rule that takes effect immediately. Previously, EU nationals – who are visa-exempt for business and tourism – were permitted to extend their stays past an initial 90 days, for a maximum cumulative stay of 180 days in a 365-day period.

The regulation was implemented following an agreement signed by the Brazilian government and the EU in October. The purpose of the agreement was to make business and tourism stays consistent between Brazil and the EU. Nationals of the following 25 EU countries are subject to the new limit: Austria, Belgium, Bulgaria, Cyprus, the Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Italy, Latvia, Lithuania, Luxembourg, Malta,

the Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain and Sweden.

Irish and UK nationals are still permitted to extend a stay to a maximum cumulative period of 180 days in a 365-day period at the discretion of Brazilian authorities.

Foreign nationals who remain in Brazil beyond the permitted period of stay will be fined 8.28 Brazilian Reais (approximately $4 USD) per day, payable on departure. The maximum fine that can be levied is 827.75 Brazilian Reais (approximately $410 USD). Other penalties include potential deportation and a bar against re-entering Brazil in the future.

Germany EU Nationals Will No Longer Need Confirmation of Free Movement (November 16, 2012) EU nationals who wish to reside in Germany will no longer need to obtain Confirmation of Free Movement documents from their local immigration offices. The German Parliament passed legislation on October 19, 2012 that will discontinue the issuance of this confirmation. The change is expected to come into force in the near future, but a date has not yet been announced.

Currently, an EU national who wishes to reside in Germany completes two separate procedures: one to register his or her residential address in Germany and one to collect a Confirmation of Free Movement.

The confirmation has served to facilitate certain processes in Germany during which EU nationals may be asked for written confirmation of their legal status, such as opening bank accounts and enrolling children in school. However, German organisations are not permitted to require the document and the German government may not charge fees or collect any revenue for producing this document. Thus, the Federal Parliament has voted to stop providing it in order to reduce costs, despite the fact that it has had some benefit for EU nationals.

Most EU nationals have full rights of free movement within EU countries, which allow them to enter, work and reside in these countries without restriction, although national governments typically require that EU nationals complete some form of registration. The abolition of the Confirmation of Free Movement is expected to reduce bureaucracy at local town halls in Germany. It will have no effect on the rights that EU nationals enjoy in Germany.

Winter International HR Adviser

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Global Immigration Update Australia Australia Expands APEC Business Travel Card Eligibility (November 16, 2012) On November 1, 2012, the Australian government launched the second and final implementation stage for the Asia Pacific Economic Cooperation (APEC) Business Travel Card (ABTC), broadening the expedited travel clearance programme to Australian citizens who are employed by an entity that is certified as engaged in international trade or investment in the region by the Australian Industry Group or the Australian Chamber of Commerce and Industry.

The change in policy will be particularly beneficial to small and medium-sized businesses that did not qualify under prior criteria. Previously, ABTC applicants had to be employed by a company on the Forbes Global 2000 business list or by a recipient of a prestigious Australian business grant or award.

To be eligible for the ABTC, an Australian applicant must serve as an owner, director or senior business person (such as a CEO, CFO, board member, regional or country head) of a qualifying business entity, or be nominated by a senior business person to conduct trade in the AsiaPacific region on behalf of the certified entity. Each applicant must have made at least four business trips to other APEC member countries in the 12 months preceding the application, and have a clean criminal record. If residing outside Australia, the applicant must demonstrate lawful status in the country of residence.

These criteria apply only to citizens of Australia. Citizens of other APEC members must apply to the relevant government agency in their home country and qualify under that country’s eligibility criteria.

About the APEC Business Travel Card Designed to facilitate international trade and investment among APEC member countries, the ABTC programme generally relieves card holders from visa or entry permit requirements when traveling on business and allows for expedited entry and exit via designated APEC lanes at participating major airports. The following APEC member countries fully participate in the card programme: Australia, Brunei Darussalam, Chile, China, Hong Kong (China), Indonesia, Japan, South Korea, Malaysia, Mexico, New Zealand, Papua New Guinea, Peru, Philippines, Singapore, Chinese Taipei, Thailand, and Vietnam.

Canada, Russia, and the United States are International HR Adviser Winter

transitional members of the programme.

Cardholders should not use the ABTC to travel to countries for which they already hold a visa. In some countries, including Australia, this may result in the cancellation of the existing visa. Travellers should seek advice from their immigration service provider about the potential implications of entry using an ABTC when they hold a visa for the destination country.

Italy Same-Sex Spouses Now Eligible for Immigration Benefits (November 20, 2012) The Italian Ministry of Internal Affairs has announced that same-sex marriages will be recognised for immigration benefits to the same extent as their oppositesex counterparts, effective immediately.

To qualify for immigration benefits, a same-sex marriage must be duly registered and recognised by the country in which the marriage took place. Currently, Italy does not recognise civil registrations or partnerships.

Italian and other EU citizens may now sponsor a same-sex spouse for a family permit of stay. Foreign nationals who will temporarily work or reside in Italy in an immigration category that permits accompanying family members may also sponsor a same-sex spouse. Fragomen worked closely with Studio Mazzeschi (Italy) to prepare this alert.

Nigeria Government Announces Further Investigation into Possible Expatriate Quota Abuse (November 26, 2012) The Nigerian government today published a notice in national newspapers asking specific international companies by name to respond to allegations that they engaged in a practice of noncompliance with the rules governing Expatriate Quotas – the company permit that authorises the employment of a foreign national in a specific position. Companies named in the notice have until December 3, 2012 to respond.

Those that fail to do so could face further government investigation, a curtailment of their ability to sponsor foreign nationals for work authorisation, or the cancellation of existing work authorisation.

Today’s notice highlights the Nigerian government’s increased focus on immigration compliance generally, and the Expatriate Quota system in particular.

Earlier this year, the Ministry of Interior

introduced an electronic immigration database system to better track employers that violate quota requirements. The government also created a special joint committee mandated to investigate allegations of quota abuse by private companies and regulators. The joint committee is the agency responsible for today's publication and is due to report to the Nigerian House of Representatives with respect to its findings and recommendations. Fragomen worked closely with Bloomfield Advocates & Solicitors in Lagos, Nigeria to prepare this alert.

United States USCIS Issues I-9 Guidance for Employers of DACA Recipients (November 20, 2012) A valid employment authorisation document (EAD) issued under the Deferred Action for Childhood Arrivals (DACA) programme is an acceptable List A document for Form I-9 employment verification purposes, USCIS has advised. If a current employee presents a new DACA EAD, the employer may need to amend the employee’s I-9 or complete a new one.

The DACA programme offers relief from deportation to unauthorised foreign nationals age 30 or younger who arrived in the United States before the age of 16 and meet other eligibility criteria. DACA beneficiaries are eligible for a USCIS employment authorisation document that is annotated “C-33” in the “Category” section of the document. The document also bears an alphanumeric card number.

New Hires Who Are DACA Beneficiaries If a new hire presents a DACA EAD as an I-9 document, the employer should accept it as long as it appears to be genuine and to relate to the employee who presents it. The document title, number and expiration date should be entered on Form I-9 in Section 2 under List A. Because the EAD is a List A document that establishes the presenter’s identity and employment authorisation, the employer may not request additional documentation from the employee. Employers must remember that DACA beneficiaries – like all other legally authorised workers – are protected against I-9 document abuse.

This means an employer may not subject a DACA beneficiary to higher scrutiny than any other employee, as doing so violates the anti-discrimination provisions of federal immigration law.

When the DACA EAD expires, the

Global Immigration Update employer must reverify the employee’s work eligibility in Section 3 of Form I-9.

Current Employees Who Are DACA Beneficiaries In some cases, a current employee may present a DACA EAD to the employer, either during a Form I-9 reverification or to notify the employer of a change in the worker’s personal information. Depending upon the circumstances, the employer may need to amend the employee’s existing I-9 or complete a new I-9. As noted above, the employer may not request any additional documentation from the employee for I-9 purposes.

New I-9 required. A new I-9 is required if there is a change in the employee’s name, date of birth, immigration status attestation or Social Security number (if the number was provided on the previous I-9). When completing the new I-9, the employer should enter the employee’s original hire date in Section 2 of the form, and attach the previously completed I-9 to the new form.

Section 3 only required. If there is no change to the employee’s name, date of birth, attestation or Social Security number, the employer must complete Section 3 of Form I-9 to reverify the employee’s work eligibility. The document title, number and expiration date of the DACA EAD must be entered, and the employer must sign and date the section.

If the employer previously completed Section 3 for employee or if the edition of the original Form I-9 is no longer valid, the employer must use a new I-9 form, completing only Section 3, and attach it to the previously completed I-9. (The current edition of Form I-9 is dated August 7, 2009; the February 2, 2009 edition is also acceptable).

When to Use E-Verify for DACA Beneficiaries Employers who participate in E-Verify should use the system to check a DACA beneficiary’s work eligibility only if the individual is a new hire or a current employee for whom a new I-9 was completed because of a chance in the employee’s name, birth date, immigration status attestation or Social Security number. If the employer only completes Section 3 (whether on a previously completed I-9 or on a new I-9), E-Verify should not be used.

What the DACA I-9 Guidance Means for Employers The new USCIS guidance answers some of the technical I-9 questions employers have

raised since the DACA programme was unveiled several months ago, and makes clear a DACA EAD is a valid I-9 document. But it does not provide guidance on two key issues for employers: What should the employer do if a current employee informs the employer that he or she is applying for DACA benefits – essentially admitting that he or she is not in the country legally and does not have work authorisation? And what if an employee uses pay stubs or other employment records to demonstrate eligibility for DACA? In these circumstances, DACA poses some potential risks for employers.

USCIS has stated that it will not used information obtained in the DACA application process to pursue employers who have employed DACA applicants or refer those employers to Immigration and Customs Enforcement, the agency responsible for I-9 compliance. However, ICE has not made a similar statement, and it is unclear how it will handle information pertaining to DACA applicants and their employers.

An employer who completes Form I-9 correctly at the start of employment is shielded from liability if the employee later is discovered to be unauthorized or, relatedly, using a stolen or fraudulent identity.

But if an employee advises an employer that he or she is seeking DACA benefits, the employer will acquire actual knowledge of the employee’s lack of work authorization. Under current law, permitting the employee to continue employment in this situation would make the employer liable for knowingly continuing to employ someone without authorisation to work.

United Kingdom UKBA to Ease Rules for Tier 2 General and Intracompany Transfer Categories (November 27, 2012) Eased requirements for Tier 2 intracompany transfer (ICT) and general visa holders in the UK will take effect starting December 13, 2012. Among the changes are a longer maximum stay for ICTs earning at least £150,000 per year; an increase in the amount of time Tier 2 visa holders can spend out of the UK before applying for permanent residence; and clearer rules pertaining to the amount of time a Tier 2 visa holder must spend outside the UK before being permitted a subsequent Tier 2 stay.

Longer Maximum Stay for High-Earning ICTs At present, long-term ICTs (visa holders

who earn an annual salary of £40,000 or more) can stay in the UK for up to five years. This period of stay will be extended to a maximum of nine years for those who earn an annual salary of £150,000 or more.

Greater Clarity on the Cooling-Off Period for Tier 2 Visa Holders The new rules are expected to help both general and ICT Tier 2 visa holders more easily determine when they will be eligible to begin a subsequent Tier 2 stay.

A Tier 2 visa holder whose period of stay has elapsed must spend at least 12 months outside of the UK before he or she can be granted another Tier 2 stay. This is known as the “cooling off period.” Beginning December 13, a Tier 2 cooling off period will start on the earliest date the foreign national can show that he or she left the UK. Currently, the cooling-off period begins only after a Tier 2 worker’s visa expires or is cancelled, or the foreign national has left the UK. This policy has been problematic in situations where a Tier 2 intracompany transferee ends his or her stay prematurely and has to go through the early visa cancellation process known as visa curtailment. Curtailment can delay the start of the cooling-off period by as much as three months after the ICT’s employment ends – thus lengthening the actual period before the foreign national can take up a second Tier 2 stay.

Allowable Absences and Settlement Tier 2 general visa holders will be able to spend up to 180 days per year outside the UK and still remain eligible for settlement in the UK after five years in Tier 2 status.

At present, a Tier 2 worker can qualify for settlement after five years in Tier 2 status, but only if he or she has spent no more than 180 total days outside the UK during that time period, which amounts to an average of 36 days per year. Immigration officials can exercise discretion in allowing Tier 2 visa holders to apply for settlement even after exceeding 180 days outside the UK, but this exception is applied by officials with a great degree of discretion. The new policy will provide Tier 2 visa holders who travel frequently with a greater degree of certainty as to whether they will qualify for settlement after five years.

United States US Consulates in India Expand Waiver of Nonimmigrant Visa Interviews (November 27, 2012) Winter International HR Adviser

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Global Immigration Update Qualifying H-1B, individual L-1, F and J visa holders are now eligible for a waiver of the nonimmigrant visa interview if applying to renew their visa at a US consulate in India.

Applicants selected for the interview waiver will benefit from streamlined visa renewal procedures, though will still be required to appear for a biometrics appointment.

Previously, interview waivers in India were available only to foreign nationals applying to renew a B-1/B-2, H-4 or L-2 visa at the discretion of a consular officer.

Who Qualifies for an NIV Interview Waiver?

The interview waiver is available to foreign nationals applying to renew a B-1/B-2, C1/D, F, H, J or individual L visa, as long as the renewal is in the same classification as the applicant’s most recent visa and that visa was issued in India. Applicants for L-1 visas under an employer’s blanket petition are not eligible for the waiver.

The applicant’s most recent visa must have been issued after August 1, 2004 (or after November 1, 2008 for drop-box application services). The prior visa cannot have been annotated “clearance received” or have been lost or stolen. The applicant must have had no visa refusals in any category since his or her most recent visa issuance.

If applying for an H or L renewal, the applicant’s most recent visa must still be valid or have expired within the previous 12 months. If applying for a B-1/B-2, C1/D, F, or J visa renewal, the applicant’s most recent visa must still be valid or have expired within the previous 48 months.

Children under 14 are eligible for the interview waiver if their current visa is in the same category as that of a parent applying for renewal. Applicants age 80 or older are also eligible.

Applying for the Waiver To obtain the waiver, the visa renewal applicant must pay all relevant visa application and reciprocity fees according to the consulate’s payment procedures. Next, the applicant must complete Form DS-160, the online nonimmigrant visa application, and print the filing confirmation page.

Once the application is filed, the applicant must create an account at www.ustraveldocs. com/in, the US consulates’ visa application website, and follow the steps to schedule an interview. The applicant will be asked a series of questions to determine whether he or she is eligible for an interview waiver and drop-box application services. Note that consular officers have the discretion to International HR Adviser Winter

require an interview even if the applicant is otherwise eligible for a waiver.

If the applicant meets the waiver requirements, he or she must schedule a biometrics appointment at an Offsite Facilitation Centre. The applicant must bring a valid passport, most recent visa, and supporting documentation to the appointment. Children under 14 must also bring a photocopy of their parents’ visas. Applicants who qualify for dropbox service must submit these materials to a drop-off location, along with a drop-box confirmation letter and a recent passportsize photograph. If the consulate needs additional documents or information, the applicant will be notified by email.

If the visa application is approved, the passport and new visa will be delivered for pickup at a Document Collection centre selected by the applicant.

In the early stages of the expanded waiver programme, several processing issues have been identified that could cause delays or other problems for applicants. The consulates have indicated that they are working on addressing these issues.

Saudi Arabia Work Permit Fees Increase For Employers with More Foreign than Saudi Workers (November 29, 2012) Companies in Saudi Arabia that employ more foreign nationals than Saudi nationals are now required to pay a significantly increased annual fee of SAR 2,400 (approximately US$ 640), up from SAR 100, for each foreign worker they employ. The increased fee took effect November 15, 2012.

The Saudi government raised the fee in an effort to increase employment among Saudi nationals and reduce the ratio of foreign workers in the country from the current 31 percent to 20 percent by 2014.

The revenue generated by the increased fee is expected to be used by the Saudi Human Resources Development Fund to train Saudi nationals, making them more appealing to employers.

United Kingdom UKBA Pilots New Expedite Service for Tier 2 Applications (November 30, 2012) The UK Border Agency (UKBA) is piloting a new expedited processing service for Tier 2 applications, known as the Priority Postal Service (PPS). During the pilot, the UKBA will accept thirty Tier 2 applications per day from applicants in the

UK and aims to process PPS applications within 10 working days. The new programme seeks to alleviate high demand for the UKBA’s existing premium customer service programme.

During the pilot phase, a request can only be submitted to the Priority Postal Service by a designated legal representative. If a request for PPS processing is accepted, the legal representative will receive an email from the UKBA notifying him or her to submit the client’s application and filing fees online within 24 hours. After the application is submitted, a Biometric Notification Letter will be sent to the applicant, who will then have two days to submit biometrics and supporting documents at one of three London post offices.

From the point the application and filing fees are submitted online, the case should be processed in ten days.

Russia Government Limits New Language Requirements to Certain Visa-Exempt Nationals (December 4, 2012) Visa-exempt nationals seeking Russian work permits for employment in the housing, utility, retail business or consumer service industries must demonstrate basic Russian language skills, effective December 1, 2012.

Foreign nationals using the Highly Qualified Specialist Programme to work in Russia are exempt from the new requirement.

The application of the new language requirements is narrower than initially expected. When the Russian government first announced language and civics requirements for work permit applicants earlier this year, they were expected to apply to most foreign nationals sponsored for standard work permits. The government has not specified whether a civics test will be required for work permit applicants.

An applicant meets the language requirement if he or she is a national of any country in which Russian is an official language; holds a secondary-level diploma or degree issued in a country of the former Soviet Union or a territory of the Russian Federation; or has passed an examination of Russian as a second language, administered by a Russian government-certified language centre.

The content herein is provided for information purposes only. If you have any questions, please contact Fragomen Global, LLP on +1 (212) 688 8555 (direct) globalknowledge@fragomen.com www.fragomen.com

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To apply for your free subscription please either complete the enclosed subscription card or visit our website www.internationalhradviser.com and complete the online registration International HR Adviser is the leading, quarterly magazine for International HR professionals globally. It has been publishing for 13 years and covers topics such as International HR Strategy, Benefits, Tax, Global Tax, Technology, Compensation, Trends in International Assignments, Healthcare, Insurance, Surveys, Country Profiles, Immigration, Moving & Relocation, Spousal Support, Education, Property, Cross-Cultural Issues, Case Studies, and more.

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diary dates JANUARY 2013

The 4th King's College London and Cornell University's ILR School International HRM Academy (IHRMA) Programme 16 – 18 January 2013, London The IHRMA is a forum that shares cutting edge academic research (often before publication), new knowledge and ideas with practitioners and industry experts. In so doing, it provides insight and understanding into highly demanding, strategically critical, current global HR management issues.

The January programme will cover the following themes (further details and our brochure can be found at www.internationalhrmacademy. com): Globalisation, global firms & emerging management challenges; Changing HR paradigms and global value chains; The changing role of global HR and the CHRO; Developing international HR strategy, metrics & analytics and ROI; Managing major organisational change across international boundaries; Leveraging talent within the global organisation; People risk & reward in an international context and International business communication, collaboration and negotiation.

If you would like further information or wish to register your interest, please contact stuart.woollard@kcl.ac.uk or visit www.internationalhrmacademy.com.

FEBRUARY 2013

The Corporate Relocation Conference & Exhibition 4th February 2013, Hotel Russell, Russell Square, London www.internationalhradviser.com This event is FREE to attend. There are seminars dedicated to educating and up-dating International HR professionals on key developments and current leanings relevant to the industry, running throughout the day. The 2012 Conference & Exhibition saw over 700 visitors attend this not-to-be-missed event, so please email Helen@ internationalhradviser.com to book your space at the any of the following seminars of your choice: 10.30am - Third Culture Kids - Raising Portable Children There are many challenges associated with an international move, and how global mobility impacts children is a concern for many families.

This session on Third Culture Kids will discuss what research tells us about these unique youngsters and how we can best support them during this life-changing experience. This session is for parents, but also educators, human resources and and relocation professionals who want to understand more about raising and educating children abroad.

Presented by Mary Langford, an independent international education consultant, who has over 30 years experience working in international schools with families of many nationalities. As a TCk who spent a transient childhood in Europe, the USA and Latin America, her personal insights and professional experience make her a strong believer in the many advantages gained by internationally-mobile children when they are supported by parents and schools.

11.30am - I’m Settled....What’s Next? - A Focus On Long-Term Relocation Support Often all of the attention is placed on the first few weeks of an international move. Join FOCUS to learn the longer-term support factors which have been proven to ensure a successful relocation for the whole family. Presented by FOCUS. 12.30pm - Tax Planning Tips For Expatriates Imperative tax issues for foreign nationals living in the UK including understanding the UK tax system as it applies to a non-UK national, choosing between the remittance and arising basis of taxation, maximising foreign tax credits and dealing with investment considerations”. Presented by Frank Hirth.

2.00pm - Global Immigration This seminar will be a practical session providing advice on the latest Immigration developments and the implications for businesses and will cover: Immigration Policies Updates, Global Immigration Management, Compliance and Risk Management, and United Kingdom Sponsor Licencing and Management.

If you have an immigration enquiry that you would like our consultants to cover on the day please email your enquiry in advance to fs@fergusonsnell.co.uk. Presented by Ferguson Snell.

International HR Adviser Winter

3.00pm - How Do You Apply Procurement Practices To Mobility?

Procurement in the mobility industry can be a complex task, as the concept of supplier management is in its infancy when compared to industries such as technology or retail.

SIRVA utilises proven procurement principles that are the foundation of this presentation. As we walk through each step in the process, we provide best practices as well as examples that will simplify the application of procurement to mobility management.

4.00pm - Payroll Compliance For Mobile Employees As the pressure on internal and external compliance gets greater, the challenges of reporting compensation data for international assignees, in particular relocation expenses and third party vendor expenses, get no easier. Data is invariable embedded in multiple data sources, often in different locations.

At the seminar we will discuss what the reporting requirements are, what challenges are faced by organisations and explain some of the ways in which companies are deploying global processes to collect and report relocation expenses and third party vendor expenses. Presented by Deloitte LLP. Worldwide ERC® Global Mobility Specialist (GMS)® Designation Programme 11 February, Module 3, London, UK - Lancaster London Hotel Check www.worldwideERC.org; Education & Training tab for details Worldwide ERC® Global Workforce Summit: Talent Mobility in EMEA 12-13 February, London, UK - Lancaster London Hotel Check www.worldwideERC.org/Pages/emea2013-london.aspx for details and to register The Expat Academy - Technical Seminar 26 February 2013 (9.00am - 1.00pm) Deloitte office, 2 New Street Square, London EC4A 3BZ This seminar will focus on what is current in the Global Mobility world and will ensure that you are updated on all the current trends. Please book your free place directly on our website at www.expat-academy.com The Expat Academy – Club 100 Session 26 February 2013 (3.00pm - 5.00pm) Deloitte office, 2 New Street Square, London EC4A 3BZ If you have a globally mobile population of around 100 this meeting gives you the opportunity to share information on current issues. Please book your free place directly on our website at www.expat-academy.com

MARCH 2013

The Expat Academy - Technical Seminar 14 March 2013 (9.00am - 1.00pm) Deloitte office, 2 New Street Square, London EC4A 3BZ This seminar will focus on what is current in the Global Mobility world and will ensure that you are updated on all the current trends. Please book your free place directly on our website at www.expat-academy.com The Expat Academy - Global Heads Meeting 14 March 2013 (2.00pm - 5.30pm) Deloitte office, 2 New Street Square, London EC4A 3BZ This meeting is by invitation only and allows Global Heads to learn, connect and share.

The Expat Academy - Global Mobility: A Practical Introduction Course 18 & 19 March 2013 (9.00am - 5.30pm) Deloitte office, 2 New Street Square, London EC4A 3BZ This course covers the essential principles of global mobility and its practical application. If you are fire fighting inaccuracies and constantly managing expectations this will be a really beneficial course for you.

You will also leave equipped with a valuable toolkit for daily use back in the workplace. To attend this course please book directly on our website at www.expat-academy.com Global Workforce Summit: Talent Mobility in APAC 19-20 March, Shanghai, China - Pudong Shangri-La Hotel Check www.worldwideERC.org Worldwide ERC® Global Mobility Specialist (GMS)® Designation Programme 21-22 March, Modules 1 & 3, Shanghai, China - Pudong Shangri-La Hotel Check www.worldwideERC.org

DIRECTORY Assignment Management Services

Total Reward Group Chart House, 10 Western Road, Borough Green, Kent, TN15 8AG Contact: Simon Richardson Telephone: +44 (0) 1732 780777 Fax: +44 (0) 1732 668284 Email: simon.richardson@totalrewardgroup.com Website: www.totalrewardgroup.com Total Reward Group is a ‘boutique’ employee owned reward practice, providing consultancy, search, interim managers and professional training for analysts.

The Global Mobility division of TRG provides both advisory services on policy development, as well as fully outsourced assignment management services, which provides a ‘virtual’ in house Global Mobility HR service.

BANKING

LLOYDS TSB INTERNATIONAL Address: Waterloo Place, PO Box 1400, London, SW5 9RE Contact: Cliff Govender Telephone: +44 7736 359952 Email: cliff.govender@lloydstsb.co.uk Website: www.lloydstsb-offshore.com/ employeebanking Lloyds TSB International is part of Lloyds Banking Group, one of the UK’s largest retail banking groups with strengths and resources that extend worldwide. With a network of offices spanning four continents and dedicated English speaking customer service teams available 24-7, we are well placed to meet the financial needs of international employees and customers wherever they are in the world.

As expatriate banking specialists we understand that a new life abroad comes with a host of different opportunities and challenges. Our extensive local knowledge and international banking expertise will ensure that employees and customers have what they need to make the most of this exciting time in their life.

NatWest Global Employee Banking Address: Eastwood House, Glebe Road, Chelmsford, Essex, CM1 1RS Contact: Neil Barsby, Head of NatWest Global Employee Banking Telephone: +44 (0)1245 355628 Email: neil.barsby@natwestglobal.com Website: www.natwestglobal.com NatWest Global Employee Banking is a specialised department within NatWest who work with Company HR functions/ Relocation Agencies to offer a streamlined account opening service for relocating employees. One of the main benefits of the service is that employees can apply for their account before they arrive in the UK so their account is ready when they arrive.

This may also help if they want to transfer funds to their new account in preparation for relocation.

BUSINESS ASSOCIATION J-1 VISA PROGRAMME

BRITISHAMERICAN BUSINESS (BAB) 52 Vanderbilt Avenue, 20th Floor New York, NY 10017, USA Contact: Tamra Eker Telephone: +212 661 4060 Fax: +212 661 4074 Email: teker@babinc.org Website: www.babinc.org BritishAmerican Business’s J-1 visa program assists companies in offering US training and work experience to qualified employees of any nationality and from anywhere in the world, for a time period of up to 18 months. Sectors covered by our J-1 Visa designation include management, business, commerce, finance, law, industry, sciences, engineering, architecture, information media & communications. Using the J-1 Visa helps companies overcome cross-cultural differences and improve communication between US and overseas offices; enhance employee recruitment/retention efforts by offering US assignments; and meet global mobility challenges. Please call to discuss the program with our J-1 Visa Program Administrator.

HR SERVICES

ASSOCIATION OF RELOCATION PROFESSIONALS (ARP) PO Box 189, Diss, IP22 1PE, UK Contact: Tad Zurlinden Telephone: 08700 737475 Fax: 01379 641940 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 ASSOCATION (EURA) PO Box 189, Diss, Norfolk, IP22 1PE Telephone +44(0)8700 726 727 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.

IMMIGRATION

FRAGOMEN 4th Floor, Holborn Gate, 326-330 High Holborn, London, WC1V 7PP Contact: Caron Pope, Partner William Foster, Partner David Crawford, Partner

Telephone: +44 (0)20 3077 5000 Email: londoninfo@fragomen.com Website: www.fragomen.com As the world's leading provider of immigration legal services and advice, Fragomen has served the immigration needs of clients ranging from individuals to the world’s leading multinational corporations for 60 years. With 36 offices in 15 countries worldwide, Fragomen has the resources and the reach to provide strategic and effective immigration solutions for over 140 countries around the globe.

INTERNATIONAL HR CONSULTANTS

DELOITTE LLP Stonecutter Court, 1 Stonecutter Street, London, EC4A 4TR Contact: Robert Hodkinson, Partner Telephone: +44 (0) 20 7007 1832 Fax: +44 (0) 20 7007 1060 E-mail: rhodkinson@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.

INTERNATIONAL MOVING

DT MOVING LTD 49 Wates Way, Mitcham, Greater London, CR4 4HR Contact: Tim Daniells Telephone: +44 (0) 20 7622 4393 Fax: +44 (0) 20 7720 3897 Email: london@dtmoving.com Website: www.dtmoving.com DT Moving is a world leading international moving company. Founded in 1870 as Davies Turner, we provide an awardwinning* move management service for corporations who relocate their employees to locations all over the world. Whether your employee is moving to or from Europe, America, Asia-Pacific, Africa, or simply just around the corner, we manage the entire process. Our goal is your complete satisfaction from initial contact right through to delivery. With a customer satisfaction rating of 96% for 2011, we offer unrivalled quality at competitive rates.

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DIRECTORY RECRUITMENT

RED GROUP OF COMPANIES The Bower, Langford Hall, Witham Road, Maldon, Essex, CM9 4ST Contact: Caroline Frostick-Seear and Amie Cutts Telephone: 01621 840600 Fax: 01621 856062 Email: amie.cutts@redrecruit.com Website: www.redrecruit.com Red Recruit was founded in 2002 and specialises in the Relocation and mobility industry. We are a very professional, friendly and reputable company who have extensive knowledge within the industry.

We have access to a large volume of potential candidates all seeking work in your industry all over the UK, we will be able to find you a suitable candidate to enhance your business.

We personally understand the importance of finding the right calibre of staff for an organisation. By using our service we will take the pressure off you of finding a suitable candidate for your company, saving you time, money and effort, giving you the best attention at all times.

RELOCATION HCR Relocation UK Head office - Belvedere House Basing View, Basingstoke, RG21 4HG, UK Contact: Sally Kelly - HCR Business Development Manager, EMEA. Telephone: +44(0)1256 313780 Email: skelly@hcr.co.uk Website: www.hcr.co.uk Twitter: @relochatter LinkedIn: http://www.linkedin.com/ company/hcr-group-limited We look after people, your people. We have a dedicated, high performing and professional team to deliver our award winning relocation service. Our knowledge, experience and empathy ensures that each of your relocating employees and their families are carefully managed and that their specific needs are considered. HCR has a true ‘one point of contact’ philosophy; One dedicated, cross trained Account Manager and Lead Relocation Consultant who will manage, co-ordinate, deliver and provide comprehensive support for every relocation case.

INTERDEAN RELOCATION SERVICES Central Way, Park Royal, London, NW10 7XW Contact: Barrie Gilmour Telephone: +44 (0)208 961 4141 Fax: +44 (0)208 965 4484 Email: London@interdean.com Website: www.interdean.com Thinking Relocation? Think Interdean.

Whether looking to expand into new territories or to leverage your human capital in core international markets, Interdean has the relocation service to support the needs of your business and your relocating employees. Interdean provides the full range of relocation services to support businesses with international interests. We make it easy. Our Services: Relocation Management, Visa & Immigration, Area Orientation, Temporary Housing, Home Finding, School Search, International HR Adviser Winter

Settlingin Assistance, Tenancy Management, Household Goods Moving, Intercultural & Language Training, Relocation Expense Management, Moving & Relocation Insurance and other services available – please ask.

SCHOOLS

International Community School 21 Star Street, London, W2 1QB Contact: Matthew Cook, Director of Marketing with Admissions Tel: +44 (0) 20 7402 0416 Web: www.icschool.co.uk Email: marketing@icschool.co.uk Twitter: @icslondon Youtube: ICSLondon An international school located in the centre of London. We offer all three International Baccalaurate Programmes (PYP, MYP, and Diploma) to children aged 3-18yrs. ICS has a diverse community with 45 different nationalities, and boasts a strong tradition of working with students who need support with learning English and also Special Educational Needs. Students at ICS benefit from a wide ranging activity programme during term time and also during school holidays. We have an outdoor education centre located in Bawdsey, Suffolk and an extensive Travel and Learn programme that has taken students as far afield as Brazil, South Africa and the Galapagos Islands.

ISL Group of Schools ISL Surrey Old Woking Road, Woking, Surrey GU22 8HY Contact: Claudine Hakim Telephone: +44 (0)1483 750 409 ISL London 139 Gunnersbury Avenue, London W3 8LG Contact: Yoel Gordon Telephone: +44 (0)20 8992 5823 ISL Qatar PO Box 18511, North Duhail, Qatar Contact: Nivin El Aawar Telephone: +974 4433 8600 Website: www.islschools.org Email: hmulkey@islschools.org Celebrating its 40th anniversary in 2012, the International School of London (ISL) Group has schools in London, Surrey, and Qatar.

The internationally recognised primary and secondary curricula have embedded language programmes (mother tongue, English as an Additional Language, and second language) which continue throughout the student’s stay in the school. A team of experienced and qualified teachers and administrators provides every student with the opportunity to grow and learn in an environment that respects diversity and promotes identity, understanding, and a passion for learning.

MARYMOUNT INTERNATIONAL SCHOOL LONDON Address: George Road, Kingston upon Thames, KT2 7PE

Contact: Mrs Cheryl Eysele Telephone: +44 (0)20 8949 0571 Email: admissions@marymountlondon.com Website: www.marymountlondon.com With an outstanding record teaching the respected International Baccalaureate for over 30 years, Marymount offers day and boarding to girls aged 11-18 who gain places at the world’s best universities.

Consistently ranked within the top 5% globally, Marymount also offers the pre-IB Middle Years Programme; this stretches students without the need for incessant testing. The nurturing, supportive Catholic Community welcomes all faiths and achieves a shared purpose for girls of more than 40 nationalities.

TASIS THE AMERICAN SCHOOL IN ENGLAND Coldharbour Lane, Thorpe, Surrey, TW20 8TE Contact: Karen House Telephone: +44 (0)1932 582316 Email: ukadmissions@tasisengland.org Website: www.tasisengland.org TASIS England offers the International Baccalaureate Diploma, an American college preparatory curriculum, and AP courses to its diverse community of coed day (3-18) and boarding (14-18) students from 50 nations. The excellent academic programme, including ESL, is taught in small classes, allowing the individualised attention needed to encourage every student to reach their potential. Outstanding opportunities in art, drama, music, and athletics provide a balanced education. Extensive summer opportunities are also offered. Located close to London on a beautiful and historic 46-acre estate.

TAXATION

BDO LLP 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 600 offices in 100 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.

Entries in this Directory cost £175 per issue or £700 per annum.

For further details email helen@internationalhradviser.com