International HR Adviser Winter 2019/2020

WINTER 2019/2020

ISSUE 79

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International HR Adviser The Leading Magazine For International HR Professionals Worldwide

FEATURES INCLUDE: Business Travel – Is It Time To Redefine Duty Of Care? • Global Mobility Coming Of Age Leaving The UK? Tax Issues To Consider When Working Outside Of The UK Managed Housing Programmes: The Mobility Solution You Didn’t Know You Needed How Multinationals Buy International Relocation Services • Talent: Emerging Trends In International Work Arrangements Bridging The Gap: Important Questions About Global Cost Of Living Allowances Why Mental Health Should Be A Top Priority For Expats And Their Employees • Global Mobility Professional Insight: Seriously…What’s The Point?

Technology: Case Study – Implementing A Business Traveller Management Solution • Bringing Innovative Talent Mobility Solutions To Frankfurt

ADVISORY PANEL FOR THIS ISSUE:

CONTENTS

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International HR Strategy: Business Travel – Is It Time To Redefine Duty Of Care?

Fatima Johnson, Jessica Smart & Ben White, Deloitte’s Global Workforce Practice

Global Mobility Coming Of Age Tracy Figliola & Gina Vecchio, Global Mobility, Equinix

Managed Housing Programmes: The Mobility Solution You Didn’t Know You Needed Kamal Advani, BridgeStreet

Taxation: Leaving The UK? Tax Issues To Consider When Working Outside Of The UK Andrew Bailey, BDO LLP

Global Tax Update Andrew Bailey, BDO LLP

Technology: Case Study – Implementing A Business Traveller Management Solution Liam Brennan, GT Global Tracker

Employee Wellbeing: Why Mental Health Should Be A Top Priority For Expats And Their Employees Dr Phil Sharples, UnitedHealthcare Global

Talent: Emerging Trends In International Work Arrangements John Rason & Julia Palmer, Santa Fe Relocation

How Multinationals Buy International Relocation Services Paul Bernardt, Harmony Relocation

Bridging The Gap: Important Questions About Global Cost Of Living Allowances Laura Levenson, Weichert Workforce Mobility

Global Mobility Professional Insight: Seriously … What’s The Point?

Chris Blair, Global Mobility Systems Thinking Lead, Aviva

Bringing Innovative Talent Mobility Solutions To Frankfurt Nouran Zarroug, Worldwide ERC

Supporting Relocating Employees: Living And Breathing The Language Joanne Danehl, Crown World Mobility

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Diary Dates

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

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INTERNATIONAL HR STRATEGY

Business Travel: Is It Time To Redefine Duty Of Care?

Once upon a time, travel programme managers ensured that corporate business travel was booked and recorded in a way that complied with their corporate travel policies, ensuring travel costs were managed centrally. ‘Duty of Care’ meant having mechanisms in place should an employee need support while abroad for incidents like national disasters, medical emergencies or other security or safety concerns. The risks were both physical and very tangible but it was, in many ways, a simpler era.

However, the story of duty of care is everevolving. Immigration, tax and regulatory authorities are now increasing their efforts in the business travel space and are increasing their focus on both individual and corporate compliance obligations. We are witnessing an increase in the volume of international travel, and a tightening of legislation globally. With advancements in technology, the sharing of data between authorities is becoming more common place. In the UK, for example, we have seen the Border Agency sharing travel data with HMRC to facilitate the active pursuit of tax liabilities. Authorities are also increasingly sharing information with their counterparts in other jurisdictions. There have even been cases where social media has been used to identify travel and travellers.

One of the most recent developments impacting the behaviour of country authorities’, and sending business travel programme managers scouring their systems for data, is the revised European Posted Workers Directive (PWD) which has created far more scrutiny of the mobile workforce. Authorities are actively auditing companies to ensure that pre-travel notifications have been submitted, and labour law requirements such as minimum wage, working time, vacation and health and safety standards are being upheld in the receiving country. This convergence of factors has in many ways redefined the duty of care.

The compliance obligations arising from business-related travel fall on both the employer and the employee, but employees often expect support from their employer to help manage their compliance responsibilities.

So what does this mean for business travel compliance programmes? A heady mix of

greater scrutiny, potential audits and more stringent reporting requirements mean travel programme managers are increasingly focused on ensuring employees’ right to work (immigration, regulatory etc.), the need to meet local tax and social security requirements, as well as managing other risks associated with business travel. The challenge arises in demonstrating compliance in each of these complex areas, without loading additional administrative burden on employees.

How Is This Extended Definition Of Duty Of Care Shaping Business Travel Programmes?

Organisations are trying to get their arms around busy, time-challenged and often techsavvy mobile employee populations. Today’s business travellers expect support to enable travel at short notice; compliance should not be time consuming and must never detract from ‘the day job’. Employees expect supported business travel and managed compliance.

In extending the definition of duty of care, it is recognised that there are three essential elements in delivering “turbulence free travel”: Compliance, Experience and Value.

All three coalesce to deliver the optimal approach to duty of care. Getting the balance right can be complex, but it is critical.

Compliance

If, as an organisation, you have already accepted, or are on the road to accepting, that the duty of care remit has expanded, how do you best

convert this new aspiration into reality? How do organisations transform a business travel programme that was historically focused on ‘spend and security’ into a contemporary one, aligned with the broader compliance challenges organisations face today? In futureproofing your business travel programme you will need to prioritise your challenges and define a roadmap of enhancements as well as educating the stakeholders required to support these processes.

A common challenge when developing or evolving a business travel compliance programme is defining and engaging the stakeholder group, and the ultimately responsible party, to enable effective change management. Having a broad stakeholder group approaching business travel compliance holistically, sharing the management of this population, may be the best approach. They can better help identify, assess and prioritise compliance areas throughout the business travel lifecycle that impact both employees and the business. Whilst every business is different, the stakeholders typically include the topics in the chart below.

The role of the stakeholder group is to design and implement practical solutions within your business to manage an expanded duty of care.

Business travel programmes vary in complexity, and solutions need to be aligned to the size and scale of your travelling population. Many organisations start by looking at data sources within the business to understand risk. They may go on to implement technology solutions

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INTERNATIONAL HR ADVISER WINTER

and create data ecosystems, to connect the travel booking process and broader compliance obligations (from identification, assessment to downstream compliance activities), allowing for greater governance and reporting.

Takeaways: • Identify key stakeholders for a business travel working group • Define your Duty of Care ambition • Understand your global travel risks and obligations • Develop a roadmap of programme enhancements.

Experience

Business travel programmes’ success is dependent on simple processes that maximise traveller engagement, typically centred around a great traveller experience.

Business travellers often have to navigate numerous pre-travel and on-travel activities, and adding additional self-service steps are likely to be met with resistance. Where travel programmes have relied upon employees entering data for travel booking and risk/ compliance assessment purposes, adoption rates are often lower than expected and compliance objectives are not delivered on to their full potential. Technology is now enabling businesses to remove additional employee input, seamlessly utilising travel booking data to run the compliance assessment in the background. This allows organisations to put employee experience at the heart of the process, thereby delivering on enhanced duty of care with minimal disruption for travellers.

The corporate user – i.e. those responsible for overseeing business travel compliance – can often be overlooked when considering ‘employee experience’. Building processes and protocols that allow corporate users to efficiently access data, make assessments and take action, enables them to focus on the prioritised risk areas, and can be critical in ensuring the success of your programme.

Takeaways: • During the design phase of your programme, place the employee at the heart of the process • Seek opportunities to seamlessly connect data, embedding your programme into existing processes • Consider how the corporate user will engage in the process.

definition of a Duty of Care is a question many organisations face as they redefine their approach. The size and scale of the user groups, including both the travellers and the corporate users and the impact of experience should not be overlooked. Designing and implementing a human-centric experience may determine the success of any solution and alongside effective compliance management will help drive value for your organisation.

BEN WHITE

Consultant, Global Workforce benwhite@deloitte.co.uk Deloitte LLP, 2 New Street Square, London, EC4A 3BZ BusinessTravelAdvantage@Deloitte.co.uk

FATIMA JOHNSON

Associate Director, Global Workforce fjohnston@deloitte.co.uk Deloitte LLP, 2 New Street Square, London, EC4A 3BZ BusinessTravelAdvantage@Deloitte.co.uk

Value

A redefined Duty of Care and broader approaches to business travel compliance management may mitigate risk for your business and deliver a positive experience to your travellers, driving value for your organisation.

There are multiple ways in which this additional value and business performance can be realised: How best to develop a more holistic business travel programme, encompassing the broader

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The story does not end here. It will continue to be ever-evolving with new forces and obstacles emerging to challenge organisations, from the introduction of new legislation and regulations, to the changing needs of travellers, and future advancements in technology, there will be many further chapters to this story.

Constantly monitoring and challenging the definition of duty of care enables organisations to deliver compliance… without turbulence.

JESSICA SMART

Consultant, Global Workforce jjsmart@deloitte.co.uk Deloitte LLP, 2 New Street Square, London, EC4A 3BZ BusinessTravelAdvantage@Deloitte.co.uk

DELOITTE’S GLOBAL WORKFORCE PRACTICE

Deloitte’s Global Workforce team partners with organisations to establish future-proof global workforce strategies, tailored to client specific business and talent objectives. We embrace design thinking to help clients reimagine and transform their approach to talent mobility, focusing on areas including business travel, policy and process design, strategic and operational transformation, global talent strategies, digital innovation, planning and deployment, and workforce analytics. Find out more about Global Workforce and Deloitte’s Business Travel Advantage services at https://www2. deloitte.com/uk/businesstravel

INTERNATIONAL HR ADVISER WINTER

Global Mobility Coming Of Age Extinction or expansion? This is the stark reality being faced by Global Mobility professionals today.

Traditional assignments are dying out yet, cross-border movement overall is on the rise (just not in the same manner as has been the case previously). There are continuous calls for greater flexibility, less bureaucracy, increased opportunities for more junior staff as well as moderately, priced assignments geared towards more senior levels but constructed to provide experience and learning to bolster their internal marketability and career growth. Streamlined, efficient processes, rising levels of automation, a continuously changing geo-political landscape, heightened compliance requirements as well as the ever-present mantra of ‘the employee experience’, only add to the enormous pressure under which Global Mobility is struggling to remain relevant.

These changes can be viewed by some as a harbinger of disaster, sounding a death knell for international mobility functions. Or, they can be embraced by Global Mobility professionals, allowing them to demonstrate the versatility, agility and desire to rise to the challenge, and to meet it. Rather than highly transactional interactions, Global Mobility professionals need to be able to adapt and move comfortably into a trusted partner space providing advice, guidance and counselling to business leaders, shepherding them through the morass of compliance requirements which seem to impact more and more aspects of the mobility landscape. Could this, then, be a new age for Global Mobility?

If we breakdown the various points into their constituent parts, we can begin to understand and address each aspect in turn.

First, is the steady decline of the traditional full-blown Long-Term Assignment: an international posting for a period of up to 5 years where the individual and their household decamp to an assignment location for the duration. The reason for the decline in numbers for these types of postings of course, lies in their cost. Relocation costs, differences in cost of living and housing, dependent education costs, possibly the loss

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of second income due to the inability of an accompanying spouse to take employment and tax costs, all contribute in pricing this type of package out of consideration for all but a select few in today’s world.

In certain respects, recalibrating and relaunching policies aimed at long-term postings is the easier proposition to address.

To mitigate some of these impacts while still serving the needs of the business and employees will require flexibility and adaptability on the part of Global Mobility and a fair amount of creativity as well.

Constructing a segmented set of diverse and flexible policies while being smarter and more creative around the structure and use of commuting and gross-paid (sometimes referred to as Host-Plus packages) and, of course, greater employment of short-term assignments, goes without saying.

Both gross-paid and commuting assignments can, with careful planning, be deployed for mid and upper level staff to address developmental, experience and on-going management requirements, all the while minimising impacts to budgets and disruptions of family life. Engaging with business managers and HR Business Partners early on will be key to understanding the drivers for and budget constraints. Careful probing of whether actual presence in country is required will be essential in ascertaining whether commuter application might not lend itself to fulfilling the brief.

It can also provide tax planning possibilities that a full, in-country assignment might otherwise obviate.

A second powerful pressure for Mobility professionals lies in the increasing demands from the business for shortterm international experience assignments targeted at, and designed for, Millennial and Gen Z employees. The business wants and need more globally savvy employees but don’t really give it any more in-depth thought or planning than that. Not to mention, also more times than not, they are not willing to accept the price-tag to achieve it. All the while the younger employees continue to clamour for international posting opportunities and are quick to vote with their feet if they feel such opportunities are being denied them. Trying to balance the competing needs and pressures is a heavy burden for Global Mobility.

While it is certainly possible to respond by facilitating postings of more junior staff elsewhere, the question remains: what is the overall intention of the posting? Surely there must be more than just allowing junior

members of staff to live and work in another international office? In being reactive rather than pro-active, however, are line managers and Global Mobility acting in a fiscally responsible manner for the organisation?

There is a disconnect in many organisations between having an appropriate programme to address the desires of the Millennial and Gen Z staff when weighed against the needs and drivers of the business.

In a disproportionately large number of organisations, there is a woeful lack of cohesion between the business, Talent Management and GM, which runs the risk of losing Millennials and Gen Z sources of future talent from the organisation.

While GM can and do design lower-cost assignment structures that can meet the business desires of cost containment and succeed in deploying the Millennial and Gen Z’s on assignment, there is a lack of proper development and structure of curricula, outcomes and return on investment measures, to truly address future business needs. While understanding cultural differences and nuances is undoubtedly beneficial for an employee’s long-term growth and an organisation’s need for building global mindset, it cannot be the sole reason for a company undertaking the time and expense of an international posting.

How then should GM and Talent Management respond? Global Mobility, partnering with Talent Management, must insert itself into the conceptualisation, creation and subsequent building of a sustainable, re-usable assignment programme framework for experiential learning and exchange.

Certain companies do attempt to provide some sort of learning experience for employees, generally by placing the onus onto individuals and/or line managers to devise a syllabus and effectiveness measures. In doing so, however, this more times than not misses the point and are left with – at best – an inchoate programme. Is it truly enough to merely ask an employee what they want to achieve from an overseas opportunity and leave it at that? Is it sufficient response from the line ‘to give them international exposure’?

Where is the disciplined, business focused and targeted approach that would normally be applied to a proper business case? Would all the exigencies be suitably drawn out early enough to identify and cover off on potential blockers that might cause the plan to stagnate, resulting in frustration and disappointment for the employee and manager alike?

In order to ensure an appropriate, genuine learning and development experience that

GLOBAL MOBILITY COMING OF AGE is fit to advance the employee’s position whilst also providing a suitable return on investment for the employer, a properly structured opportunity with tangible, measurable results and outputs is necessary.

Answers will be required on whether it is possible to structure and how those learning opportunities might be organised; who will be responsible to set the learning agenda; what the expected return on investment is, what the quantifiable outputs will be and, how will that be measured?

Global Mobility can position itself to be experiential assignment architects, assisting in the choreography of the learning and growth agenda by closely partnering with Talent, HR Business Partners and the business: • Identifying likely role profiles: with Talent Management, HR Business Partners and Line Managers identify and target specific roles to be in programme scope • Clarifying – which roles and locations will lend themselves (immigration, tax) to a strategically focused training programme: minimum education, experience and/or earning requirements • With Talent and HR, interrogating your talent pool database to identify and carve out a High Performing cadre • Matching individual attributes: technical/ linguistic skills, education, grade and compensation against roles

• Defining the programme: - Rotational: through roles/departments/ locations on the career pathway - Immersive: targeted posting to hone a specialisation (specific role or stream) - Project facing: targeting set, pre-defined on-going project tasks • Candidate selection interviews and criteria: cultural fit, personal circumstances, motivation, and emotional maturity/ intelligence.

While at times and by varying degrees difficult, time consuming and complicated, there is no substitute for putting in the hard work required to formulate a proper learning cum business plan for an experiential assignment. Only by showing the willingness, ability and agility to transform itself will Global Mobility be able to remain an integral part of the business landscape. Otherwise, Global Mobility may very well go the way of the dinosaur.

Global Mobility Professional

noun 1. obsolete ARCHAIC Title historically used to denote a [now extinct] provider of global assignment services to clients and their employees; one who ensured relocations and transitions proceeded as smoothly as possible.

TRACY FIGLIOLA

Senior Director Global Mobility 5 years at Equinix. Previously Global Head of GM for HSBC 20+ years’ experience in GM.

GINA VECCHIO

Senior Manager Global Mobility 4 years at Equinix.

Previously held numerous head of function positions in financial services + others. 30+ years’ experience in GM.

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INTERNATIONAL HR ADVISER WINTER

Managed Housing Programmes The Mobility Solution You Didn’t Know You Needed According to a recent Gartner study, more than half of HR leaders surveyed reported “improving employee experience” within their top three priorities for 2019. As mobility professionals know better than almost anyone, a heightened focus on employee services and satisfaction when it comes to travel is directly aligned with a company’s ability to attract and retain talent.

Where this alignment often runs off track is when cost management presents a competing priority.

As a leading provider of extended-stay travel and relocation solutions, our own organisation is working with HR, financial and mobility professionals around the world to solve both cost and employee satisfaction challenges with an approach called a Managed Housing Programme. While this isn’t a new offering, many companies simply aren’t aware of it, despite the fact that a Managed Housing Programme can

Managed Housing Programmes can save your company 25% to 35% over hotels while providing a more customised choice that can be an extension of the brand culture and ethos 8

provide a full-service solution that delivers convenience, choice, trust, cost savings, and price transparency and reliability.

If you have a regular stream of travellers or assignees to a specific location, particularly a location where the availability of suitable hotels is either scarce, unpredictable or expensive, a Managed Housing Programme provides an option worth considering.

Managed Housing Programmes can save your company 25% to 35% over hotels while providing a more customised choice that can be an extension of the brand culture and ethos. It also provides travellers and assignees the added benefit of a local experience in a home-like setting.

While most mobility professionals are well aware of furnished apartments as an attractive extended stay choice, few have considered a Managed Housing Programme, which is essentially an extended stay solution where companies contract with furnished apartment providers to furnish and manage a set number of apartments exclusively for their use. These accommodations can be set up at an apartment building in a convenient location, they can be equipped and furnished to a company’s specifications and managed like an extended stay hotel. The right provider can provide an online platform and mobile app that offers employees an easy way to check in and check out while reducing the administrative burden on the company. They will also support it with reporting and analytics to give you an insight into usage and 24/7 access for assignees and travel or relocation managers to address issues that may come up.

Some companies have gone as far as designing the apartments in their branded colour schemes and asking their service provider to private label the website that employees access. In addition to having predictable supply and accommodations that employees love, the savings for a large programme can be in the millions. Unlike hotels or even traditional serviced apartment options, a Managed Housing Programme delivers consistent pricing and a reliable, captive supply of accommodations.

One global company, for example, partnered with us to develop and manage a Managed Housing Programme that provides access to more than 100 apartments

exclusively dedicated to employees visiting their corporate headquarters. The result is a predictably available supply of quality accommodations, which is estimated to cost several million dollars less than comparable hotels.

Professionally managed furnished apartments continue to be rated as a top choice for business travellers who are staying at a location for more than seven nights.

They provide the “live like a local” experience that many corporate travellers are looking for combining the amenities of a hotel with the conveniences of home

MANAGED HOUSING PROGRAMMES Beyond these significant cost savings, this company selected all the furnishing and amenities to ensure comfort and provided employees and mobility managers with a convenient tech platform for an easy and convenient booking and check in/out experience.

Highlighting a different flavour of this offering, another company with suburban headquarters where hotels are not hard to find has a programme with only 7 apartments that caters to their employees that typically stay for 2 weeks or longer. Their apartments are not highly customised, but still provide them with predictable quality and availability.

While such programmes have been around for some time, the new twist that makes them worth looking into is the technology that makes them easy to use. There was a time when managing such a programme manually made it difficult. Now, with on-line booking technologies, employees can selfserve, making them very easy to administer.

Best in class providers offer a high tech – high touch approach where travellers and assignees can access the apartments with on-line tools and mobile apps and at the same time, talk to a customer service representative if and when needed.

Professionally managed furnished apartments continue to be rated as a top

choice for business travellers who are staying at a location for more than seven nights.

They provide the “live like a local” experience that many corporate travellers are looking for combining the amenities of a hotel with the conveniences of home. A Managed Housing Programme allows you to offer this to extended stay travellers as well as short stay travellers while lowering costs.

While controlling costs is a concern that can’t be ignored, in many cases mobility is not only a first impression of a company but can

also be an assurance of career paths available to retain valuable talent. For some of you, Managed Housing Programmes provide a costeffective way to take exemplary care of your employees while significantly reducing mobility and relocation costs. But whatever the approach, employers who prioritise employee retention and satisfaction must work within financial constraints to develop a programme that leverages tech innovation to ensure convenience but still holds hospitality in the highest regard to ensure a highly robust guest journey.

KAMAL ADVANI

Chief Executive Officer at BridgeStreet where he is focused on driving forward the company’s leadership in technology and innovation in a quickly-evolving industry. Advani brings decades of experience to this position and is committed to serving BridgeStreet’s expanding clientele of on-demand business travellers, corporate travel planners, and worldwide property supplier.

BridgeStreet is the innovative world leader in extended stay business travel and relocation. With a technology platform built for extended stay business travel bookings and relocation services, BridgeStreet is dedicated to their partnerships with both their property owners and suppliers. Founded more than 20 years ago, BridgeStreet has been recognised as the trusted experts in extended stay business travel management. With Hospitality experiences in more than 22,600 cities in over 130 countries, BridgeStreet serves more than 5000+ enterprise customers globally.

Visit www.bridgestreet.com

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TAXATION

Leaving The UK? Tax Issues To Consider When Working Outside Of The UK In our Autumn 2019 article, ahead of the then impending Brexit ‘deadline’ of 31 October 2019, we put forward a case that the UK was very much ‘open for business’ for inbound assignees and continued to be an attractive destination for assignments, if only from a UK tax perspective. This case hinged on the substantial UK tax reliefs and tax advantages available by virtue of the assignee’s personal circumstances and with tax planning.

Since writing that article, the Brexit ‘deadline’ has been extended and at the time of writing this later article a General Election looms. In this current article, we now look at general tax considerations for outbound assignees. Similarly, there may be reduced UK tax liabilities and significant non-UK tax reliefs available, again depending on the assignee’s personal circumstances and with tax planning.

The tax advantages and reliefs available to outbound assignees can vary from the most simple being that an individual moves from a relatively high-tax jurisdiction (i.e. the UK) to a low-tax jurisdiction (e.g. Hong Kong or Singapore) and perhaps reaps the benefit of the lower income tax burden, to more structured and prescriptive forms of relief such as specialist expatriate tax regimes available in a number of countries.

Leaving The UK – The Domestic Tax View

Depending on the length of the overseas assignment, it may be possible for the assignee to break tax residence in the UK. In a significant number of cases where this is possible there is also likely to be the opportunity to split the tax year into a period that is chargeable to UK income tax, and a period thereafter where certain income will not be chargeable to UK income tax. There are three cases by which an individual can qualify for split year tax treatment, each having prescriptive conditions to be met in order to qualify. The cases are as follows: • Case 1: Starting full-time work overseas • Case 2: Partner of someone starting full time work overseas • Case 3: Ceasing to have a home in the UK

It is important to note that in order to qualify under Cases 1 and 2, an assignee or their partner have permitted residence days and workdays limits that they must not exceed for the split year treatment to be applicable.

Splitting the UK tax year and becoming non-UK tax resident can be tax advantageous.

For those who qualify for a personal allowance, this allowance does not get pro-rated for periods of UK tax residence and non-UK tax residence in a spilt year. Refunds of Pay As You Earn can be generated solely from the application of a full personal allowance to the chargeable period. If an individual files a UK tax return then a refund can be claimed via self-assessment. For individuals who do not file a UK tax return as all of their income has historically been taxed via PAYE they could be potentially missing out on refunds of UK income tax unless a departure form, P85, is filed with HM Revenue and Customs.

It should be noted that the splitting of the UK tax year and the advantage that it can create by reference to the personal allowance also works in reverse when an assignee returns to the UK. If the correct tax coding for PAYE purposes is not in place from the outset, it is possible that the individual will have overpaid PAYE in the year of return and could be due a UK tax refund.

The UK tax rate bands are similarly not apportioned for spilt UK tax years and this in turn can also generate UK tax refunds in years of departure from and return to the UK. Arrival and departure tax years in the overseas location may also qualify for the full, un-apportioned, availability of annual allowances, exemptions, reliefs and tax bands, which will result in a lower effective overseas tax rate.

For those moving to a low tax jurisdiction that are responsible for their own taxes or have been assigned under a Tax Protection policy rather than a Tax Equalised policy the overseas employment income, nonchargeable in the UK, is then subjected to a lower rate of tax enabling the assignee to reap a windfall in the form of higher net pay during the assignment period. Clearly this is not the case if someone moves to a higher tax jurisdiction. The assignee should check whether tax equalisation will be applied by their employer whilst they are on an overseas assignment as this may neutralise any tax advantages that arise.

A further consideration for those planning on being out of the UK for a more substantial period of time is that while non-UK tax resident an assignee is not subject to Capital Gains Tax in the UK. For individuals intending to and who go on to be outside of the UK for a period of not less than 5 complete tax years, disposal of assets in a non-resident period can lead to substantial tax savings. Gains made in the non-resident period crystallise on return to the UK if the 5 complete tax year absence criteria is not met. Care also needs to be taken if a non-UK tax resident assignee decides to dispose of their personal residential home, as while there may not be any UK tax to pay on this, there is the requirement for the transaction to be reported on a Non-Resident Capital Gains Tax return.

In terms of income that remains taxable in the UK to a non-resident, the most common example of this is in the form of rental income, where an assignee rents out their private UK home during a period of absence from the UK. In terms of employment income, it is important to watch out for trailing income in the form of bonus payments or equity compensation that could remain taxable in the UK under sourcing methods following departure from the UK. Workdays undertaken when returning to the UK may also be taxable depending on the nature of those workdays. Non-incidental UK workdays will typically be taxable whereas incidental UK workdays will not.

Low-Tax Jurisdictions

In the UK, the top rate of income tax is currently 45% for earnings in excess of £150,000 per annum, with graduated rates operating prior to that top threshold. As such the UK is generally considered to be a high-tax jurisdiction.

There are a number of lower tax jurisdictions to which individuals are regularly assigned. These include jurisdictions such as the United Arab Emirates where there is no income tax, Hong Kong which has a top income tax rate of 17% and Singapore which has a top income tax rate of 22%.

There is also the impact of tax rate thresholds to consider when determining whether a jurisdiction is a low tax or high tax jurisdiction. For example, while the top rate of US Federal income tax is 37%, the tiered

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threshold at which an assignee starts to pay the top rate of tax is set far higher than in the UK for example, and so despite the possibility of state taxes on top of Federal taxes in the US, there is still a possibility of a reduced tax burden in comparison with the UK. It should not go without comment that at the time of writing we are in the midst of a general election campaign where it is acknowledged by one of the major parties that they would intend to lower the threshold at which the highest rate of income tax becomes payable in the UK, potentially widening the gap between the amount of tax an individual can expect to pay in the UK versus the amount of tax that might be payable in an overseas jurisdiction.

For assignees who are not on a tax equalised assignment, ceasing to be UK tax resident can be fiscally attractive due to the reduced rates of income tax that apply in many countries.

From an employer perspective, care needs to be taken when assigning individuals to low-tax jurisdictions. This is due to the attractiveness of the higher net pay experienced whilst on assignment, which then results in difficulty persuading the individuals to return to their home location at the end of the assignment, without increasing the employers cost. Again, advance planning and forethought can minimise any impact.

Expatriate Tax Regimes Overseas

A number of jurisdictions have special expat tax regimes in place for inpatriates that are designed to be beneficial and attract individuals to work in that location. A few of these have been summarised below: The Netherlands – The 30% Ruling Highly skilled migrants who fulfil the necessary criteria can apply for a 30% ruling from the Dutch tax authorities. The facility allows the employer to give the assignee a 30% tax free allowance, meaning that a maximum of 30% of the salary attributable to time spent working in the Netherlands could be free of taxation.

The 30% ruling is applicable for a maximum of 5 years (this was previously 8 years before the rules were recently changed).

It is also possible for additional amounts to be received free of tax in relation to the international school fees of the assignee’s children.

Belgium – Special Expatriate Tax Regime Foreign executives employed on a temporary basis in Belgium can benefit for a favourable tax regime whereby they are subjected to the individual income tax applying to nonBelgian tax residents even if they are tax resident in Belgium under their domestic tax rules. By virtue of this regime, the assignees foreign sourced income is exempt from taxation in Belgium.

In addition to the above, certain expatriate expenses paid for by the employer (moving

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costs, annual home leave trip to home location, cost of living allowances, housing allowance, tax equalisation, etc.) are treated as bona fide employee expenses and are exempt from taxation within certain limits.

Sweden – Special Expatriate Tax Regime Foreign key staff members moving into Sweden, by the approval of Taxation of Research Workers Board, may qualify for a special tax relief whereby 25% of the assignee’s income is exempt from tax.

In a similar fashion to the reliefs detailed above, there are also exemptions from tax available for the cost of schooling of the assignee’s children, moving costs and annual home leave trips.

The relief is available for a period of 3 years but care needs to be taken in order to ensure that the tight deadline for applications to be filed (at the latest 3 months after commencement of work in Sweden) is met.

Switzerland – Special Expatriate Tax Regime Special relief for expatriates working in Switzerland allows them to deduct all reimbursed costs caused by their stay in Switzerland, including moving costs, housing costs, housing costs in the home location, travel costs and schooling costs if there is not an adequate public school offering available.

A lump sum deduction of CHF 1,500 per month can be taken in lieu of the actual costs (except for the schooling costs).

While we have not covered the specific qualifying criteria in detail for any of the above, generally there will be a requirement that the assignee is considered a key worker that may have skills that are not locally available, there may be a salary based qualification, and criteria regarding not having spent time in the country in a preceding period or having an intention to stay for an extended period.

It is important to understand the relief on offer, but also to understand the eligibility criteria and the application deadlines so that opportunities for relief are not missed.

Non-Expat Specific (i.e.

Domestic) Tax Reliefs Available

In our previous article, we mentioned the availability of Temporary Workplace Relief in the UK, a relief whereby an assignee can gain a deduction from earnings for reasonable travel expenses incurred.

In certain countries where there is no beneficial tax regime in place for expatriates there may be similar domestic tax reliefs that are not necessarily specific to assignees, but for which the criteria for qualification can be met. An example of this is the business travel expense legislation in the United States of America.

Tax relief is available in the US for the ordinary and necessary expenses of

travelling away from home for business purposes, which is stated as being if your duties require you to be away from the general area of your tax home for a substantial period. This can be a significant relief considering that it can include:• Travel costs between the home and business destination • Shipping of baggage • Meals and lodging • Dry cleaning and laundry • Business calls.

The relief is limited in terms of the qualifying period. Travel expenses are not deductible if they are incurred in connection with an indefinite assignment. While it is appreciated that very few assignments are considered indefinite, for the purposes of this relief the term given to indefinite is more than one year. If the assignment begins with the expectation that it will be for a duration of more than one year the relief is not available. If the original intention is for the assignment to be for less than one year and that intention then changes, the relief is lost from the date of the change of expectation.

A Note Of Caution

While much of the commentary thus far, relates to reliefs that may be available and the taxation in the UK of a non-resident individual post-departure, a note of caution must be sounded in relation to understanding the tax jurisdiction to which an assignee is heading.

There are potentially other impacts lurking that may not always make destinations as desirable as they may otherwise seem. The United States of America can be one such destination. If an assignee becomes tax resident in the United States they are taxable on their worldwide income and foreign tax credits are utilised to ensure that items are not doubly-taxed. This is fine in principle, but an assignee from the UK may have funds invested in tax-efficient vehicles such as ISAs which are treated differently in the US, such that the tax-efficiency envisaged is eroded.

Also, if an assignee moves to the United States and becomes resident, they may wish to consider carefully the sale of their private residence back in the UK. Whilst this would likely qualify for Principal Private Residence relief and result in no taxable gain in the UK, the gain would only be tax-free in the US if not in excess of the exclusion amount for the sale of your home ($250,000 for single taxpayers, $500,000 if filing a joint return).

It is therefore important that assignees are aware of unintended consequences that may arise from decisions made while they are tax resident in an overseas location.

The Impact Of Social Security

The reliefs discussed above are all in relation to the tax position of the assignee. The other

TAXATION aspect of the personal situation that should always be considered for individuals leaving the UK is the social security (NIC) position.

At the time of writing the UK is still operating under the EU rules for assignments into the EU, which typically enable the assignee to stay in the UK social security for assignments of up to 2 years. In addition to this, we have a number of totalisation agreements with other countries enabling the same result in terms of social security, in some cases for longer periods (such as 5 years under the United States agreement).

For the rest of the world we have a 52 week continuing liability to UK social security in circumstances where they remain employed by the UK entity.

Assignments where individuals are able to stay in the home country social security system offer the certainty of no change for the individual. However, in assignment circumstances where contributions become due in the overseas location, there could be savings made as the contributions could be capped or payable at a lower percentage rate.

Indeed, there are certain locations where it may simply not be possible to make contributions to the overseas scheme even though no NIC contributions are required to be made in the UK. A point to be aware of is that voluntary contributions to the UK social security system may be an option to be explored in

such cases so that a full UK social security record is maintained. Additionally, the cost of contributions is but one aspect to consider, the other being the benefits potentially available as a result of any contributions.

Summary

With careful planning, there can be significant tax reliefs or advantages to be obtained when assigning individuals from the UK to an overseas jurisdiction. Not only can refunds be generated in the UK of overpaid Pay As You Earn, but special expatriate tax regimes exist that can substantially reduce the exposure to tax in some overseas locations.

Eligibility criteria need to be scrutinised to ensure arrangements fit the requirements, as well as attention paid to tight deadlines for applications to access certain regimes.

Assignees need to be mindful of the potential pitfalls and mismatches of tax treatments that can render some planning inefficient to ensure that the best result is delivered from the opportunities that undoubtedly exist.

Whether you are coming to the UK to work or leaving the UK to work overseas, do seek guidance in order to optimise the tax reliefs and exemptions that are made specifically available by tax authorities to encourage greater cross-border activity.

ANDREW BAILEY

Head of Global Employer Services at BDO LLP. He has over 30 years’ experience in the field of expatriate taxation. Andrew is indebted to Stuart Strong for his major contribution to this article. 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 or Stuart Strong on +44 (0) 20 7893 2804, email Stuart.strong@bdo.co.uk

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GLOBAL TAXATION

Global Tax Update AUSTRIA

Payroll tax obligation for employees with unlimited tax liability in Austria Up to now foreign employers without a permanent establishment for payroll purposes in Austria are not obliged to run a payroll administration for its Austrian employees.

Therefore, no wage tax is withheld during the year, with the consequence that the employees are obliged to file a tax return and declare the employment income in the tax return. Nevertheless, the foreign employer is allowed to register voluntarily for payroll purposes and deduct wage taxes on a monthly basis.

Due to a legislative amendment, the current law will change from 1 January 2020: According to the amendment to the Austrian Income Tax Act (AITA), employers with no permanent establishment for payroll purposes in Austria will also have a payrolltax withholding obligation on employment income of employees, if employees are subject to unlimited tax liability in Austria.

If the employees are subject to limited tax liability in Austria, the payroll-tax withholding obligation on employment income of these employees in Austria continues on a voluntary basis.

CANADA

Potential changes to beneficial tax treatment on stock options The Canadian government recently released proposed legislation that could limit access to beneficial tax treatment for stock options granted by certain companies after 2019. The proposals would introduce an annual limit on the amount of options that qualify for the beneficial treatment but would conversely allow a corporate deduction for the nonqualifying benefit. Companies should understand how the proposed legislation could affect them and their employees and if they may wish to accelerate stock option grants into the current year as a result.

Current Rules Under current legislation, when a company that is not a Canadian-controlled private corporation (CCPC) grants a stock option to an employee, the employee is taxed when they exercise the option on the difference between the fair market value (FMV) of the shares at exercise and the exercise price payable for those shares.

If certain conditions are met (generally the exercise price equals the FMV of the shares at the option grant date and the options are over common shares of the company), the

employee is only taxed on half of the taxable stock option benefit. This is known as the “50% deduction”.

Employers are generally unable to claim a corporate deduction where shares are issued to employees through a stock option.

annual vesting limit and notify employees.

For smaller (non-CCPC) companies that may fall under the prescribed exclusion it will therefore be key to watch for further commentary from the authorities.

Proposed Legislation The proposed rules state that employees granted stock options after 2019 in non-CCPC corporations will be subject to an annual vesting limit on the amount of the 50% deduction that can otherwise be claimed.

The limit imposed on the deduction will apply if the value of options that vest in a year is more than $200,000. The value of the shares to be used for this test is the FMV of the shares at the grant date.

For example: Henry is granted 100,000 stock options in 2020 that vest equally over a 4 year period (25,000 options per year). The FMV (and exercise price) at the grant date is $15.

Each year, the value of the options that vest is $375,000 (25,000 x $15). The 50% deduction is therefore only available in respect of the exercise of 13,333 options that vest each year ($200,000/$15). The benefit arising on the exercise of the remaining 11,667 options that vest each year would be taxable in full.

To ensure compliance with the $200,000 limit, the proposals will require employers to notify employees in writing whether the limit applies when options are granted. Employers will also be required to notify the Canadian tax authorities if options are granted that fall under the new rules.

However, a welcome change in the proposed rules is to allow an employer to claim a tax deduction when an employee is denied the 50% deduction as a result of the annual vesting limit.

Social Security Protocol China and Japan officially entered into a social security protocol on 9 May 2018, to address the issue of a dual liability for expatriates working and residing between the two states. The protocol came into effect on 1 September 2019 and the main content is as follows:

Exclusions From The Proposed Legislation As previously mentioned, the above rules would not apply to options granted in a CCPC. In addition to this, the government has recognised that many start-up, emerging or scale-up companies are not CCPCs and has indicated that the proposed legislation is not intended to apply to such companies either.

Public consultation is currently taking place regarding the definition of these companies and further details should be released in due course.

BDO Comment If the proposed legislation is enacted, employers will have an increased administrative burden to review whether stock option grants are subject to the

CHINA & JAPAN

Coverage of mutual exemption: • China: Basic pension for employees • Japan: National annuity (except for national annuity fund) and welfare pension (except for welfare pension fund).

Chinese personnel eligible: • Dispatched employees • Employees in ocean-going vessels • Employees in aircrafts • Personnel in embassies • Civil servants • Specific personnel • Trailing spouses and children.

Japanese personnel eligible: • Dispatched employees • Employees in ocean-going vessels • Personnel in embassies • Civil servants • Specific personnel Period for exemption: The maximum period in respect of the initial application for exemption is 5 years (where the assignment period exceeds 5 years, it may be extended upon approval of competent authorities or agencies in charge of both states).

MALAWI

Taxation of expatriates There is no special tax regime for expatriates in Malawi and individuals are taxable on their Malawian source income irrespective of where payment is made. Expatriates may be exempt from tax under the terms of a relevant double taxation agreement. The conditions that need to be met are usually that the expatriate should be in Malawi for less than 183 days in the tax year and remuneration is paid offshore.

Every non-resident employer is required to appoint a local resident agent for P.A.Y.E purposes. Work permits for expatriate staff

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will only be granted on condition that the employer is registered for P.A.Y.E through a resident agent.

National Pension Scheme Contribution A National Pension Scheme (NPS) managed by approved Pension Fund Administrators does operate in Malawi and can also apply to expatriates. Only those expatriates on Temporary Employment Permit who can produce written evidence that they are within a home country pension scheme are exempt.

Personal Income Tax Rates Malawian employers are allowed to use the Graduated Tax Table system for their payroll tax. This system requires that the employer deducts the payroll tax accurately such that the individual employees do not have to submit income tax returns for their employment income to the tax authorities at the end of the year unless they have other sources of income.

The Taxation Act provides for the taxation of fringe benefits granted in the hands of the employer in respect of services rendered.

With regard to employment relationship, fringe benefit means any asset, service or other benefit in kind, provided by or on behalf of an employer to an employee, if such provision includes an element of personal benefit to the employee. All employers except the government are liable to Fringe Benefit Tax (FBT). FBT is taxed at 30% of the taxable value of the fringe benefits being provided.

Taxable income of the individual is computed after considering amounts exempt from income tax and deductions allowable in terms of the Taxation Act. While taxable income from employment is subject to tax at various rates, income from trade or investment is subject to tax at an effective rate of 30%.

Customs Duty Expatriates working in Malawi temporarily or on a contract basis may import their personal effects into the county without any customs duty and VAT being levied. These include: • Household effects and other movable articles • Equipment necessary for the exercise of a calling, trade or profession • Television and hi-fi sets and • General household appliances.

All of these items must be imported for their personal use only, and must be brought within a period of six months from the date of entry into Malawi. These goods may also not remain in Malawi on a permanent basis and must be returned overseas upon departure of the expatriate, unless the foreign national obtains permanent resident status or citizenship in Malawi during the period of stay.

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UK

Class 1A NIC Lability From 6 April 2020, there will be a Class 1A NIC liability on non-contractual taxable termination payments over a £30,000 threshold which has not already incurred a Class 1 NICs liability. This more closely aligns the income tax and NIC treatment of termination payments.

The Class 1A liability will be 13.8% but will not be payable via the P11D(b) process. Instead, from April 2020 termination awards that include a cash element are still reportable via the PAYE/Real Time Information (RTI) process.

The Government also intends to pass legislation to ensure that non-resident UK nationals will also continue to receive the personal allowances post Brexit Off-Payroll Employees Following the changes that were introduced into the public sector in 2017, the government will be reforming the operation of the off payroll working rules and extending these into the private sector from April 2020.

Ways you can prepare for these changes: • Identify and review current engagements with intermediaries, including personal service companies and agencies supplying labour • Review current arrangements for using contingent labour, this is most relevant within the organisations that are more likely to engage off-payroll workers • Having comprehensive processes in place when assessing roles from a procurement, HR, tax and line management perspective are key things to think about when ensuring consistent decisions about the employment status of the people engaged • Review internal systems, such as payroll software, process maps, HR and

on-boarding policies in case any changes need to be made.

HMRC update on the availability of the tax free personal allowance after Brexit HMRC recently answered some questions with regards to legislation changes after Brexit and the ability for non-resident individuals to claim the personal allowance.

Currently, EU nationals are able to claim the UK personal allowance as a non-tax resident of the UK by virtue of their nationality. HMRC confirmed that it is their intention to continue to allow EU nationals to receive the personal allowance when the UK leaves the EU. The Government also intends to pass legislation to ensure that non-resident UK nationals will also continue to receive the personal allowances post Brexit.

Social security changes for UK employees in the EU after Brexit Many UK employers have employees working in the EU, EEA or Switzerland and calculate the NIC due on their earnings in accordance with EU regulations. After Brexit, in the event of the UK leaving with no agreement, then these EU regulations will no longer apply to UK employers.

The terms of Brexit are currently unknown, but employers should be prepared for a no-deal Brexit and understand how this may affect their employees, as well as their obligation to deduct UK NIC. Pre-Brexit At present, individuals covered by the EU Social Security Coordination Regulations are only subject to the social security legislation of a single member state at any particular time – so there can be no double contributions on the same income. The basic rule is that contributions are paid where work is performed (there are exceptions for individuals working outside their home country for temporary periods).

Brexit With A Deal In the event of the UK agreeing a deal with the other 27 EU member states then a transition period will come into force. A series of rules in relation to social security coordination have already been agreed for this scenario and these rules will be applicable until 31 December 2020.

We would expect the UK government to enter into discussions with the EU during this period to agree further rules which will be applicable after the transition period.

Brexit Without A Deal In the event of the UK leaving without a deal then the current European coordination rules will no longer apply and neither will the transitional rules mentioned above. The UK has proposed contingency legislation which would mean that we would continue to apply the European coordination rules on social security on a stand-alone basis. This does

GLOBAL TAXATION not mean that the 27 remaining member states of the EU would agree with the UK’s approach and could lead to scenarios where dual social security liabilities can arise.

The UK also has historical social security reciprocal agreements with the following EU/EEA states – Austria, Belgium, Croatia, Cyprus, Denmark, Finland, France, Germany, Iceland, Ireland, Italy, Luxembourg, Malta, the Netherlands, Norway, Portugal, Slovenia, Spain, Sweden, and Switzerland. These agreements were in place to avoid double social security contributions liabilities arising, however, it is unclear whether the countries concerned will implement the agreements. In the event the UK leaves the EU without a withdrawal agreement, the Government has stated that it will keep these reciprocal agreements under review.

Whether these come back into force will be subject to discussion and agreement between the UK and the relevant EU Member State.

There is also a consensus that many of the agreements do not adequately reflect the requirements of the modern day workforce.

The UK/France agreement, for example, only allows home country social security coverage for posted workers to continue for a period of six months followed by a possible extension period of six months. It also only applies to UK and French nationals.

Helpfully, new social security agreements with Ireland and Switzerland have already

been agreed. These will come into effect from Brexit day in the result of a “no-deal” Brexit, where other coordination measures have failed to be agreed. The updated Swiss agreement only applies to UK nationals who started working in Switzerland before Brexit (the existing 1968 agreement applies for secondees moving after Brexit).

It is hoped that the UK will be able to negotiate more up-to-date agreements with the remaining EU countries after Brexit, as the existing ‘totalisation’ agreements offer limited benefit to secondees and their employers in the majority of circumstances.

Employees Currently Working Overseas If an employee with a UK-issued A1/E101 is already working in the EU, EEA or Switzerland NIC must be paid in the UK until the form expiry date. If the end date is after Brexit day, the relevant EU/ EEA/Swiss authority should be contacted to determine whether social security contributions will be due in that country.

Employer Considerations UK employers with employees currently working in the EEA should now consider whether: • They will have additional social security contributions costs as a result of a no-deal Brexit • They will have additional employer

reporting and compliance obligations, which can also result in increased administration with the operation of payroll and ensuring social security compliance on a country by country basis.

BDO Comment When reviewing the social security position of their UK employees working in the UK, employers should consider matters such as the following: • Undertaking a risk assessment covering the current social security costs and the impact of a no-deal Brexit • Providing an assessment and identify where they will incur any additional social security costs • Operation of payrolls, facilitation of social security contributions payments and reporting requirements in countries within the EEA • Reviewing existing and future assignment policies • Preparation of employee communications and frequently asked questions on the impact of the changes for employees.

Prepared by BDO LLP. For further information please contact Andrew Bailey on 0207 893 2946 or at andrew.bailey@bdo.co.uk

SAVE THE DATES

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Monday 16th March & Monday 12th October 2020 at Smith & Wollensky, 1-11 John Adam Street, London, WC2N 6HT WE ARE DELIGHTED TO ANNOUNCE THAT ARE SPONSORING BOTH CONFERENCES AND WILL BE HOSTING A SEMINAR ON:

Global Mobility Trends & Tax Update on Monday 16th March

The session will focus on latest mobility trends and guidance regarding latest tax and social security developments around the world but with a particular focus on the UK. The session will be of particular relevance for all global mobility, payroll, human resource, tax and finance staff involved with international cross border workers.

To register your FREE place at this event, or further information, please email helen@internationalhradviser.com These events are for Senior In-House Global HR Professionals only and are FREE TO ATTEND Other sponsors include –

17

INTERNATIONAL HR ADVISER WINTER

Case Study - Implementing A Business Traveller Management Solution In these pages over the last number of issues there have been many articles about business traveller management issues for Corporates (this author included).

By now most HR, Mobility and Tax teams are aware of the problems – but what happens when you actually go to the implementation stage on a project? Who is in charge? Who is on the project team? How long will it take? Is it too hard?

We have been implementing business traveller management solutions for several years now and would like to share a Case Study on a client’s experience in implementing their solution.

In last year’s winter issue of International HR Adviser we offered some advice on ‘How To Build A Business' Case For Business Traveller Management’ (available on www.InternationalHRAdviser.com).

In other articles and presentations, we discussed how building a multi-functional team is a pre-requisite for success in delivering a successful project.

A single travel event can affect multiple stakeholders in a business, and it is important to assemble this team in advance of project commencement. We recommend the teams laid out in Fig. 1 are involved.

Each team member can have a different focus on the traveller, and each has a different interpretation of ‘Compliance’.

Mobility teams tend to focus on the Tax and Immigration compliance issues, but a single or repeated travel event can also contribute to creation of a Permanent

Fig. 1

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Establishment risk. Corporate Tax and Legal teams are interested in data concerning business travel activity in this increasingly protectionist economic environment.

A single solution – integrated with travel management systems and HRIS or other internal systems can deliver multiple back end solutions to stakeholders – while giving the traveller only one point of interaction.

So, if that is the optimal solution -what happened with our client implementation?

Let’s look at the context: • Company recently divested from Parent – Global Multinational • Parent retained all ‘Systems’ • In need of new ‘Mobility Tool’ • Implementing new travel booking and expense management tool • Implementing new Despatch tool for Service Engineers to cover global client base • 22 Countries • 3100 employees • 1300 regular travellers.

With the recent divestiture all IT systems had to be replaced and there were several different projects in implementation stage when we first got involved.

We were selected as the provider for the ‘Mobility Tool’ and our main contact was the global immigration lead.

First Stages

In the Bid/RFP process there was a focus on the Tax and Immigration compliance issues – as you would expect. When we first came on site, we found out that several different systems were being implemented across the company. These included a new Employee Portal, New Travel

& Expense Tool and a new Despatch tool for management of Service engineers – the main traveller group in the company. The intention was to integrate the travel and despatch systems into the Global Tracker in order to secure the highest level of data in the tool. The Employee portal would house the application in a ‘Single Sign On’ environment. We provided a company branded ‘white label’ version of our software to fulfil this desire to present the tool as an internal company process.

We also discovered that there was a separate path procuring a new Risk Management Provider – the client travels often to high risk locations to service equipment and this would be a key provider in the overall service provision.

We knew now that (as we fully expected) there were multiple stakeholders involved and as is common in many companies there wasn’t an extensive communication chain between these functions.

We requested that the client got these separate teams into a room where we could discuss the overall service implementation and discuss the overlaps in functionality and ownership across the company.

White Board Session

In a busy company with many moving parts it can often be difficult to get everyone in a room together to discuss a project.

In this case many of the functions were located at the HQ so we were successful in getting the entire group into a room. If you can’t get everyone into a room most video conferencing tools now incorporate a ‘white board’ tool that would allow you to bring in remote stakeholders.

TECHNOLOGY It was at this point we were able to build our first relationship with the IT implementation team – they were the glue that was going to put together these multiple systems and providers into one service to the user that focused on ‘User Experience’.

Our focus on ensuring the traveller has one interface to multiple stakeholders resonated with their internal focus.

We mapped out several different processes for the different user groups in the company – Service Engineers, EU travellers and US Domestic travellers. By using the white board process, we could quickly identify the sources of data and where we could provide functionality to different users within the company.

We had, through this process, now got different parts of the company to understand how a single travel event impacts different teams that may not ever communicate in the normal course of day to day activity. By harnessing the data from the travel event, it negated the need for multiple processes to be introduced to the traveller – it is after all the same travel event.

Pre-Trip Approval

One of the main features of the client requirement was to implement a robust PreTrip approval process. From the White Board session, the Mobility team were able to see that the Finance and Security teams were also looking to introduce a process to assess costs and security risks associated with a travel event. We now advised that these processes be merged in a single process for the traveller.

The selected Travel & Expense management provider could provide a pretrip module, but this had not been procured, and on examination of the associated cost this provider was excluded.

We were requested to configure the Global Tracker to support the Budget and Security Risk Management functions.

We worked with the Finance team to understand the logic associated with travel approval and set limits for ‘Auto Approval’ within the tool when the costs were within those thresholds. All other trips would be referred to Finance for approval via the system. Auto approval gave an automatic ‘Green Light’ and referrals held the trip on ‘Orange’ or ‘Pending’.

For Security Risk management we worked with the selected Risk Management Provider and integrated their Security Risk database within the Global Tracker. Where a location was rated as a security risk the trip would be referred to internal teams for approval. If Ground Support (close protection security etc.) was required in the location, the traveller could enter their itinerary details so an accurate quote and service provision could be supplied by the Risk Management Provider. When the security teams were

happy that the traveller had been briefed on the location risk, they approved the trip.

All ‘Low risk’ locations were automatically approved by the system – giving the traveller a second ‘Green Light’.

The core functionality of the Global Tracker is for Tax & Immigration compliance.

In a separate session with the Mobility teams we configured the system to reflect the culture of the organisation and the prevailing legislation in the countries they visited.

The Global Tracker currently covers 240 jurisdictions for Tax & Immigration.

With a significant volume of travel, it is essential to determine the risk profile of the company and from there to set the ‘Auto Approval’ logic of the system. There are not many Mobility teams that can analyse every single trip personally, so where automation can remove this workload it frees the Mobility teams to work on the ‘hard cases’ that arise day after day.

In this process we ask the client to weigh the ‘cost of compliance’ to the ‘risk of noncompliance’. Each client will have a different culture and risk profile and we can easily configure the system to cover each scenario.

We cover this risk scenario by reference to the potential pre-trip information (Destination, Days, Activity etc.) and the existing travel information. Many travellers give limited information to compliance teams in order to get a green light. An example may be a quick phone call to an immigration team to ask if a German national can travel to the US for a ‘client meeting’ for 5 days on an ESTA Visa Waiver - with that limited data set the answer would most likely be ‘Yes’. If, however, that traveller had spent 60 of the last 80 days in the US then the answer should be different – that traveller is most likely ‘working’ in the US and their Immigration status and work activity should be investigated. With the data in the tool these scenarios are held for examination by the immigration team – giving a ‘Pending’ status – or if the Mobility team blocks the trip – a ‘Red’ light – meaning you are not authorised to travel.

Below are are some examples of how pretrips are represented in the tool.

To drive traveller behaviour to utilise the tool the company mandated use of the tool and would not reimburse travellers for expenses if they had not utilised the tool. To support this process, we issue an ‘Approval Code’ on every trip once all three levels of approval have been achieved. The approval code must be included in future travel bookings and expense claims to facilitate reimbursement.

In other implementations we have sometime utilised only one level of approval and the system can take any combination or sequence of approvals. In this case the Budget approval was the first level – if the trip was denied for a budgetary reason there would be no call for the Mobility or Security teams to carry out any compliance actions. Once the Budget approval was received those stakeholders could then carry out their administration.

Data Gathering

Once the process for pre-trip Authorisation was complete the focus turned to gathering the data necessary for each traveller profile.

As the company was transitioning to a new HR IS system also there was no solid source of truth for this data.

We advised that the company implement a registration process whereby we created a portal for travellers to register their consent under GDPR legislation for the company to share their data with us as a technology vendor and the Tax and Immigration vendors selected during the RFP process.

Following a company-wide communication, travellers entered their details and HR then approved the upload of data directly to the tool. This was one of the first occasions that HR had actually accumulated solid data of the Nationality, Tax Residency, Home Country and other identifying data such as Cost Code and Business unit of their employees in one system – rather than being spread across multiple systems requiring multiple logins to secure data necessary to complete an Immigration application or Tax Event.

At this stage we had detailed consultation with the company data security officer as we would become a Data Processor of their employee data and control the distribution of that data to sub vendors. We supplied penetration test

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INTERNATIONAL HR ADVISER WINTER

results and details of our data centre hosting. As we utilise Amazon Web Services we were also able to position the client’s unique server in a location they requested rather than in any predetermined server location. With the impact of Data protection practices this flexibility in server location will become an increasingly important part of cloud service provision.

Rules Configuration

As the Global Tracker has over 6 million algorithms with varying degrees of alerts we work with a client to implement the system according to the risk profile we discussed above. Bespoke messaging advising travellers on the exact action required to secure visas, work permits, or tax support were incorporated with the existing messaging.

In this way the Immigration and Tax teams could send simple information that was repetitive to the traveller advising them for instance to apply directly on an Immigration provider website for a self-service business visa (including the client account identifier for billing purposes), or direct application at a Consulate. The net effect of this process was to reduce the number of calls to the Mobility team for simple applications.

This process took almost two weeks of to and fro with the client fine tuning the messaging and the risk profile.

Case Management with Third Party Vendors

With the fine tuning of the rules engine this allowed the Subject matter experts in Immigration and Tax to focus on the difficult cases and not be distracted by the simple cases.

The Global Tracker has a ‘Case’ management function to create a ‘Case’ from a pre-trip or live trip and transmit this case directly to a third-party service provider. In this way the Mobility teams have a single view of trips, days spent, cases, documents and alerts associated with each traveller. Milestones of each case can be updated in the tool automatically or via manual intervention.

The productivity impact was significant in that a pre-trip that triggered a ‘Pending’ status based on the rules discussed above would lead an Immigration or Tax internal subject expert to decide if they can resolve the issue internally (e.g.

Posted Worker registration or A1 production) or if they needed the external vendor to be involved. There was no need to jump to other systems and start filling in long forms – where the data existed in the system it could be communicated to the vendor in a few clicks.

Any necessary documents that could support an application could be uploaded

by HR or the traveller and this has had the impact of speeding up case resolution.

As many government agencies are at different levels of automation, where an agency allows for automatic filing of A1 or Posted Worker documents, the system can

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automatically compile the documents to complete this task. This is an important area of focus in the near future as government agencies develop their electronic filing processes.

Training, Communication & Rollout

We worked with the client to deliver a series of classroom and Webinar training to global HR teams and other stakeholders prior to launch and rollout. The client had no option but to go with a ‘big bang’ global launch as their old systems were being retired on a specific date.

A company wide communication was coordinated with the Finance, HR & IT teams to ensure all processes were explained.

Training manuals and bite size video tutorials were all available to new users.

We supported this launch with online chat support for all travellers who had difficulty with the instructions. The most common problem was travellers not reading the communication and simply clicking on to the site to find their way around. We handled over 100 calls in the first few days and our support teams took travellers through the process – ultimately shielding the client from this usual type of human behaviour.

In full operation there is a chat line support 24/7 for travellers across the globe.

Integration with Scheduling & Travel systems

We discussed the pre-trip process above – those trips do eventually become ‘live’ trips when the traveller actually takes the trip. The ultimate intention was to integrate with Scheduling and Travel systems and the groundwork for this is in place and is dependent on the external systems availability.

At first launch one particular scheduling system was envisaged – this was changed and now the scheduling system under development will integrate with the tool to deliver detailed trip information of travelling engineers. All other travellers trip data will come in via the Travel tool integration when that roll out is complete.

Each traveller has smartphone access to cover those trips that are not entered via the travel agency and this was a major focus as a significant number of trips are taken cross border in personal or company vehicles.

Capturing this accumulating data is critical in a robust traveller management programme.

Learning & Refinement

When we first came on site, we had a single internal client with a single objective.

Through discussion we were able to initiate communication with other relevant teams and identified complementary processes. At the time of writing now we have three major functions – Mobility, Finance and Security operating daily on the system processing many thousand business trips.

We have regular communication with the client to refine and develop the system

alerting and sensitivity as new incidences are discovered by the clients travel profile.

From conception to launch was 12 weeks – a suitable time for a client with a significant traveller base moving across borders every day.

So if we recap our original questions – Who is in charge?

Once you have determined that the business issue fits across multiple stakeholders then the project leader should be the stakeholder that is impacted most – they will drive the project to completion.

Who should be on the project team?

All companies have different organisational structures and cultures, but there are many consistent threads. At a minimum the team should include Mobility /HR, Finance, Corporate Tax, Legal, Travel, Safety & IT. It is important that a single travel event and the data associated with that is directed to the multiple teams in a single process. The traveller will thank you for implementing a single process and you will have a more successful project.

How long will it take?

This will depend on the volume and scale of the traveller constituency – schedule 12 -16 weeks for implementation – this will of course vary depending on the systems and processes of the company.

Is it too hard?

I am biased of course – but if you follow the project team approach you will find that it is a lot easier than you think!

If you would like to hear more about this case study, or if you recognise some of your own company problems and structures in this piece, please get in touch with us at www.gtglobaltracker.com.

LIAM BRENNAN

CEO & Founder of the GT Global Tracker, an award-winning software platform that powers many of the mobility industry’s business traveller management platforms.

Liam has over 25 years’ experience in the global travel, relocation and internet services industries. For more information on how to use technology to manage your business travellers visit www. gtglobaltracker.com or contact Liam on liam@gtglobaltracker.com.

INTERNATIONAL HR ADVISER WINTER

Why Mental Health Should Be A Top Priority For Expats And Their Employers In recent years, conversations around mental health have become more open. Once barely discussed, people now feel more empowered to talk about their own experiences and speak up when help is needed. This open dialogue is a positive step forward. However, given one in four people in the UK will suffer from a mental health problem at some point in their life, it’s important that we continue to make progress in this area.

One group that can be particularly vulnerable to mental health issues are expatriates. Whilst being offered an overseas assignment is an exciting opportunity for many, the challenges of working abroad can put pressure on an individual’s mental health. There are several things employers can do to help protect the mental health of their expatriate employees.

Preparation Is Key

Preparing for the unknown is crucial for those transferring to unfamiliar environments.

Employers should help educate employees and their families about cultural differences to ensure they have a good understanding of their new environment. It is important to include all family members in any prepreparation – ensuring spouses and children enjoy a positive relocation experience is critical to overall assignment success. Preparation helps keep culture shock to a minimum, allowing employees and their families time to explore their new home at ease. Culturally specific training is offered by external agencies, but a more cost-effective option for many companies is to provide support and advice from people within the organisation who have previously lived in those countries. If possible, employers should facilitate medical pre-screening for the employee and their family members. For example, UnitedHealthcare Global offers preassignment medical screening to ensure that potential health concerns are identified at an early stage, and specific plans can be put in place to mitigate any risks or stress points.

Employer Support

One of the most common times to experience anxiety is when starting a new

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job. Often this is just part of the process and will quickly subside once the initial nerves have settled. Expatriates face many more challenges than simply a new commute and different colleagues. Even if an employee is staying within the same company, the cultural differences between offices in different parts of the world can make an overseas job more complex.

Employers that reduce the emotional stress caused by relocation can increase the likelihood of a successful assignment. Given that nearly 40%(1) of overseas assignments fail, providing adequate mental health support is key to giving them the best chance of success. To help reduce the emotional stress caused by relocation, employers should establish clear lines of communication, so employees feel comfortable asking for support. UnitedHealthcare Global’s employee assistance programme offers employees face-to-face, online or telephone counselling so that no matter where a person is in the world, they have a strong support system to assist them.

Building New Relationships

Nearly half a million people in the UK suffer from work related stress(2) and workers experiencing these problems could find that feelings are exacerbated by an overseas move. Moving to unfamiliar lands can feel daunting and being physically separated from a network of friends and family can lead to homesickness. Fortunately, modern technology makes it easier than ever to connect with loved ones. UnitedHealthcare Global’s Optum My Wellbeing app allows individuals to engage and stay connected with colleagues, friends and family regardless of location. The app encourages users to take part in various fitness challenges, such as step counts, where they can track their progress against others worldwide. This is a great way to ensure employees feel connected and in touch with family, colleagues and friends across the world. The app also monitors a person’s mood to ensure his or her mental wellbeing is being tracked. This data is integrated with the Employee Assistance programme, asking the member if he or she would like to talk to someone if his or her mood is recorded as low.

ADVERTORIAL

Another way employees can feel better connected is by participating in online employee forums. These are a great space for expats to forge relationships and seek advice from those that already work overseas.

Employers should consider educating existing employees in various countries on how to welcome new team members.

Employers make a significant financial investment in sending an employee abroad and it’s important that the assignment is a success.

Focussing on mental health and making it a key part of any health and well-being strategy helps ensure a positive experience for the employee, his or her family, and the employer.

After all, the investment you make in sending your employee and their family abroad should also mean an investment in their health – both physical and mental.

Reference: (1) www.insights.learnlight.com/en/articles/ overseas-assignments/ (2) www.nhsemployers.org /news/2018/05/ new-stress-report-from-the-mental-healthfoundation.

DR. PHIL SHARPLES

DR. PHIL SHARPLES has been with UnitedHealthcare Global since 2006 and is responsible for the clinical care delivery to UnitedHealthcare Global’s clients. As Chief Medical Officer for Global Solutions, he is responsible for health care governance and clinical excellence working closely with other clinical functions in UnitedHealthcare Global in order to deliver quality healthcare solutions to clients.

Phil has a proactive involvement in the business development of the company and is a member of the International Association of Oil & Gas producers/ The International Petroleum Industry Environmental Conservation Association Health Sub Committee and has helped to define industry health guidelines.

Phil has a keen interest in professional development of healthcare practitioners and serves on the Executive Committee of the Faculty of Remote and Rural Healthcare launched by the Royal College of Surgeons of Edinburgh.

Visit www.uhcglobal.eu for further information.

INTERNATIONAL HR ADVISER WINTER

TALENT: Emerging Trends In International Work Arrangements Global mobility continues to be a vital tool for businesses to execute on their strategy. However, as we move into the next decade, we are seeing a shift in the profile of the mobile population. With more employee-initiated moves than ever, organisations must be flexible to meet not only the talent needs of the business, but also the motivations and expectations of the talent.

With four generations in the workforce, demographic diversity has challenged Global Mobility professionals to think differently, to redefine more nimble programmes, able to flex as needed.

Drawing from the findings of Santa Fe Relocation’s 2019 Global Mobility Survey, figure 1 illustrates the key current and future talent trends.

A Shift In The OrganisationEmployee Relationship The ‘New Deal’

The relationship dynamics between employer and employee are changing and so too are expectations.

Reflecting on an interview as part of Santa Fe Relocation’s research, with a global HR leader (their organisation conducts an annual ‘pulse’ survey of 7,000 employees): Expectations by generation do differ - even between Generation Z (1995 onwards) and Generation Y (1980s to 1995).

Generation Z will be internationally mobile as a recognition that this is essential to further their career and they view the employer as a consumable resource - an extension of their university experience.

Indeed, it would seem the expectation amongst this employee group is to ‘consume’ the employer for new work experiences outside of their country of employment.

However, leveraging international work interventions at an earlier career stage is not exclusive to the organisation mentioned above. Another Executive HR leader shared with us that they have adopted a similar strategy of providing international work experiences at an early stage in their high potential ‘rising stars' careers. In that organisation, technology is developing at such a rate that available talent is becoming scarcer and scarcer and the deployment of those

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Figure 1 : Key Emerging Talent Trends - A summary A shift in the organisation- The relationship between employer and employees is employee relationship changing. Employees will increasingly own their own careers.

- the ‘new deal’ The need for ‘thoughtful mobility’

Increasingly, organisations are moving towards creating purpose-led Global Mobility frameworks to align business and talent purpose with multigenerational and multicultural employee expectations.

Evolving diversity

Progress is being made in enabling women to enhance their careers through international work arrangements, as organisations seek ways to be more creative and inclusive with their talent and mobility strategies and policies. LGBT inclusion will increasingly enhance talent pools as country legislation embraces same sex civil partnerships.

An increasing focus on risk and compliance

International work arrangements are becoming more complex and in parallel, government agencies are becoming smarter at digitally tracking the movement of internationally mobile workers and connecting across borders.

A more holistic approach to Global Mobility

The ‘new deal’ over the coming decade will necessitate organisations adopting a more holistic approach to engaging, inspiring and enabling employees to work and thrive.

The reality is that the expectations of the diverse global workforce will require new approaches to Global Mobility who have undertaken long-term assignments may create a disconnect between their expectations and the available opportunities for senior roles. Emergent technology is disrupting careers as well as business models.

The reality is that the expectations of the diverse global workforce will require new approaches to Global Mobility, where the home country becomes less relevant.

International work arrangements will continue to see more fluidity in the drivers for mobility, with more employees taking control of their careers and lifestyle, electing to work, live and thrive in locations to suit their circumstances.

Now more than ever, organisations are needing to flex their approach to mobility to attract, enable and retain talent.

An increase in one-way employeeinitiated relocations, was revealed in our research findings and suggests that sustainable, capable people will manage their own career ‘share value’ and expect their organisations to ‘love them’ in the process.

By love them, we mean that organisations will have to work much harder, if not doing so already, at engaging their employees and especially those who undertake substantial international travel. Enabling and nurturing a strong work-life balance to sustain physical and mental well-being are already welldocumented as being key people priorities over the next decade.

So, the ‘new deal’ for many organisations will require clarity of purpose, emotional and cultural intelligence in how best to communicate and engage with all levels in the organisation and more team-based collaboration rather than functional and business silos. The people strategy thus needs to be agile and fluid to incorporate established

TALENT and self-employed specialists. In addition, there is a need to build teams that do not require rigid infrastructures and systems. Instead, a solid framework of people practices that enable teams to innovate and collaborate.

The Need For ‘Thoughtful Mobility’

There is a need for purpose-led Global Mobility frameworks to align business and talent purpose with multigenerational employee expectations. As organisations develop a consistent total reward strategy across their global footprint, it will become increasingly attractive for one-way company or employee-initiated relocations and more developmental transfers.

Clearly, the main checkpoint for Mobility teams is to ensure that the right policy is adopted and indeed a fair talent process followed by their HR and business peers.

Organisations are seeing themselves as more global and are drawing from a broader talent pool to fill roles wherever they may be, allowing for more employee engagement in applying for roles, where previously mobility was employer-led.

Evolving Diversity – Increased Female Engagement In International Work Arrangements

The World Bank estimates that over 42% of the workforce is female in most countries. There is still a way to go, but there are some positive indications that the mobile population is heading towards equality. Our research findings revealed an increase of female assignees from 25% in 2018 to 32% in 2019 - showing there is progress in rebalancing the opportunity for women to engage in international work arrangements. While dual careers and children’s education are likely to be significant factors in enabling more women to enhance their careers through international work arrangements, organisations are seeking ways to be more creative and inclusive with their talent and mobility strategies and policies.

An Increasing Focus On Risk And Compliance

With the burgeoning advancement of social media and technology, international work arrangements are becoming more complex and in parallel, government agencies are becoming savvier at digitally tracking the movement of internationally mobile workers and connecting across borders.

‘65% of the organisations surveyed in our research reported that they do have immigration processes in place to remain compliant, with the most popular method for tracking being MS Excel software. While this may work for tracking purposes, it will require more technical input to know if a visa and work permit is required where a Business Traveller is really working in a country (based

on a series of triggers). This may lead to more than detention at an airport and if found working whilst in the host country, triggers for payroll, tax and social security, and possibly permanent establishment issues at the organisation level.

A More Holistic Approach To Global Mobility

The ‘new deal’ over the coming decade will necessitate organisations adopting a more holistic approach to engaging, inspiring and enabling employees to work and thrive.

To this end, as policies become more segmented and the anchor to a home location or a headquarters becomes less critical for some organisations (for example, transnationals), a more holistic approach towards total reward and benefits will require greater harmonisation across the global footprint.

Whether it be a sequential series of ‘localto-local’ movements or traditional assignment types is a decision for each business to determine. Elements such as medical support and retirement arrangements will need more attention. Will these be as relevant for younger generations? Will they wish for more personal choices in how they provision their long-term wealth creation? The pension concept has been largely been based on Western models of compensation and benefits.

Employees embarking on international work arrangements will increasingly demand policies that deliver structured flexibility and support through the right balance of human and digital support mechanisms. Whether it be through self-service activities via internal company and external suppliers’ systems or well-managed destination and relocation programmes, the focus will be on establishing successful and enjoyable life experiences for employees, as they undertake often lifechanging work and personal experiences.

As the world continues to become a ‘global village’, so practices will change. The point that should be noted is that Global Mobility, as we know it today, will continue to be disrupted and those who avoid considering future alternatives will be disadvantaged in the race for increasingly scarce, valuable talent.

References and extracts from: • Santa Fe Relocation’s research report: ‘Global Mobility Survey 2019 ‘REVISION: Mobility through the looking glass’ Download: www.santaferelo.com/en/ mobility-insights/global-mobility-survey/ • Santa Fe Relocation’s white paper: TALENT: Emerging trends in international work arrangements.

Download: https://www.santaferelo.com/ en/mobility-insights/white-papers/talentemerging-trends-in-international-workarrangements/.

Visit www.santaferelo.com for more information.

JOHN RASON

Group Head of Consulting, Santa Fe Relocation, is recognised as a thought leader and speaker on strategic international HR, talent management and Global Mobility, John has 15 years of global consultancy experience, having previously held senior HR leadership roles in numerous global businesses across a range of industry sectors. He now works with global organisations to create value and improve the structure of Global Mobility programmes, focusing on aligning strategic objectives with operational delivery. John is a fellow of the Chartered Institute of Personnel and Development (FCIPD).

If you would like to discuss any of the themes or issues raised in this article, please do not hesitate to contact John Rason Email: John.Rason@Santaferelo.com

JULIA PALMER

Group Head of Relocation and Assignment Management, Santa Fe Relocation A respected mobility advisor globally, Julia has 20 years’ big four experience working with clients across all regions and industries to develop their global mobility strategy and supporting framework. She has forged her expertise by transforming the mobility programmes of a wide range of organisations, from multinational conglomerates to brand new start-ups seeking to globalise; consistently enabling these clients to form closer links between the talent and mobility agenda, with the use of data and insights.

If you would like to discuss any of the themes or issues raised in this article, please do not hesitate to contact Julia Palmer Email: Julia.Palmer@Santaferelo.com

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INTERNATIONAL HR ADVISER WINTER

How Multinationals Buy International Relocation Services There seems to be little standardisation in the way that Multinational Corporations (MNC’s) buy relocation services.

Why is that, and what are some of the flavours available?

The most common and more traditional models available are either full outsourcing to a Relocation Management Company (RMC), or direct management of the different vendors in the relocation chain, or a mix of these two.

Lately, we’ve seen another alternative which is the so-called Mobility Technology Platform.

Here, an often limited group of pre-vetted and compliant vendors are visible on the platform, and the relocating employee can initiate the services they are allowed to use, limited by a certain budget. Some services are mandatory (core-) and some are optional (flex-). A special category are those transferees that receive a lump-sum amount, and they are on their own to arrive on their first day at work in the new location. Outsourcing relocation to a vendor under a managed programme or paying a lump sum to a transferee both have pros and cons.

Providing a lump sum is easy, requires little administrative support from the employer, but the risk is that the money is not well spent, and there is a compliance risk if the transferee does something they are not supposed to do as a representative of their company, and the consequences come back to the employer anyway. An outsourced relocation programme requires more time and attention from the company, but normally these programmes service the transferee well, and the transferee is more or less guaranteed to arrive on their first day of work on time without any issues.

With Duty of Care and Compliance being top of mind for mobility departments, you may wonder why the lump sum is provided at all... let me guess – lack of available technology – that will be solved at some point then.

Often the Relocation Policy, i.e. the benefits provided to a relocating employee, will determine the way an MNC buys the relocation services. But there are many other factors that determine this? Global Mobility leadership may have a preferred way of working, a preferred vendor, a previous disappointing experience with one or the other, a strong Regional Mobility function (e.g. APAC, EMEA, AMERICAS) that does things different than head office, or personal preference of a decision maker, amongst others. Many MNC’s seem to go

26

around in circles, from full outsourcing, back to unbundling of certain larger spend areas such as immigration, shipping of household goods, and vice versa. Due to this complete lack of standardisation, vendors in the relocation supply chain have become specialists in adapting to the various ways MNC’s buy relocation services.

Cheers to the family owned local business!

Although I loathe corporate jargon, hyper-flexibility is the key-word. All who work in this industry will recognise that people get along well with each other, because on Monday they may be competitors, on Tuesday one is a supplier of the other, on Wednesday one is a Client of the other, on Thursday they need to partner with one another due to a common client, and on Friday, well, let’s take that day off shall we. All vendors in the relocation space will recognise this: Most of us are a global/ regional/national vendor for an MNC or an RMC, a vendor for an MNC under the management of a big-4 accountancy firm, a direct vendor for one service whereby an RMC manages the rest of the scope, or a vendor under a technology platform.

In spite of the jungle of operating models, we do see a trend of certain business models becoming more dominant, and we ourselves are adapting our organisation to be able to benefit from these changes. Given the fact that we are a global cooperative network of small, medium sized and some large family owned moving companies as well as DSP (Destination Services Provider) members, we have to be flexible and make sure we cater for all three customer segments, corporate, RMC and Technology Platform.

Technology platforms are relatively new market entrants, and not handicapped by having a large number of clients. Instead, they can leap-frog (ouch! speaking of corporate jargon), skip the stages of having 100’s of suppliers in their chain of vendors, and tap into networks of vendors, e.g. for tax,

immigration, moving, destination services, housing etc. We believe that networks are the future, connected through technology, with the ability to quickly exchange data through API’s. Technology platforms can also deliver value in other ways of course beyond supply chain – ease of employee choice, conveying of an employer brand and delivery of a clear, and branded digital employee experience.

Despite the consolidation (and demise of previously considered all-powerful companies) in the RMC space, our cooperative network is thriving. Also, small to medium sized family owned business pay the lion’s share of corporate tax in any country, create stable employment, support local communities, and are in business to be passed on to a next generation, rather than satisfy the rapacious appetites of the anonymous venture capitalist vultures trying to make a quick ROI. Yes, there will be amalgamation of small to medium sized businesses, but the best possible friend for an assignee arriving in a new country will always be someone that has supported 1000’s of their peers over the years. And yes, a lot of these services can be automated or digitally transformed, but the time when a robot packs a box or checks a lease contract for a property in a 2nd tier city in inland-China for compliance loopholes is still far out.

Cheers to the family owned local business!

PAUL BERNARDT

Paul Bernardt is the Managing Director of Harmony Relocation, based in The Netherlands. Paul’s main skill is driving in reverse, in spite of having a University degree in business economy.

For more information on Harmony Relocation, please contact info@harmonyrelo.com.

INTERNATIONAL HR ADVISER WINTER

Bridging The Gap: Important Questions About Global Cost Of Living Allowances Relocation costs can be very expensive for both the relocating employee and the employer. This is especially true when it comes to global assignments.

One aspect of global assignment management that is truly vexing to even the most experienced mobility professional is how best to address the complexities of providing compensation packages that preserve an equitable standard of living between the home and host location.

When an employee takes on an assignment, the cost of living in the destination is rarely the same as in their home country and city. In most cases, the assignee will end up paying either more or less for basic essentials, such as housing, transportation, food, and entertainment, than they would have if they had not accepted the assignment. In the interest of upholding a philosophy of equitable programme administration, any unintentional benefit or deficit for the employee on assignment needs to be addressed.

It is common practice for companies to adopt a Cost of Living Allowance (COLA) or Goods and Services Allowance (GSA) to bridge the gap between home and host country cost differences. One of the most misunderstood concepts in mobility, we tackle some basic questions about Cost of Living and the allowances intended to address these differences.

1. What Is A COLA Or GSA and What Is The Intent?

A COLA or GSA is an allowance designed to address the differences between how much it costs to live at the home and host location.

When an assignment is considered temporary, assignees tend to remain on home country compensation packages. Since assignees remain on home country payroll and all merit increase cycles, pay scales and increases, are based on the home country standard, spending patterns and standards of living variances in the host country are a given.

Scaling an assignee’s salary to meet the cost of living difference can be complicated, particularly when the employee is moving to a lower cost location on assignment. No one

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wants to see their salary lowered. Likewise, a move to a higher cost country would require a salary boost, and it’s then difficult to reduce the assignee’s salary back to home country levels upon repatriation. Therefore, COLA is utilised to build in an adjustment to local standards of living, without adjusting the employee’s base salary.

2. When And Why Is It Appropriate To Provide A COLA?

When an employee experiences a loss of purchasing power due to the cost of living for basic essentials at the host location exceeding the cost of living at home, a COLA is provided. Bridging the gap is not as simple as providing an allowance since allowances may only address specific expenditures.

The objective of providing a COLA is to (a) maintain the employee’s purchasing power over the course of the assignment and (b) do this in the most cost-effective and equitable manner for all employees on assignments.

3. What Data Is Used To Determine The COLA Calculation?

The best-in-class mobility programmes will leverage data from several sources, not just one. The most critical components are the international COLA index and local market price data, which can be purchased from an independent third party data provider. This data is available for various levels of living standards and is updated on a regular basis. Most companies will look to validate this information with input from their local Human Resources managers based on their unique company culture and practices that might slightly impact the way the data is used. And finally, at Weichert, we often tap into our destination services providers, who are excellent local resources and subject matter experts in all things hyper-local – where to shop, dine, live, and how to get around cost effectively.

4. What Is A COLA Index?

To calculate each city's COLA index (also called a ‘price index value’), a central reference city is selected (Prague, as an example) and assigned a value of 100. Once the reference point has been established, the price index value of every other city in the database is calculated by comparing their cost of living to the cost of living in the central reference city (Prague).

Therefore, if a city has a price index of 134, that means that living there is 34% more expensive than living in the central reference city (Prague in this example).

5. How Are The Indexes Calculated?

Third party data providers calculate costof-living differentials for a given family size and level of income. The provider develops a standard “basket of goods” that represents average expenditures for a typical household. They will then compare the cost of purchasing this same basket of goods in each location. This represents the percentage of income needed to purchase the same items in each location relative to the cost for the same basket of goods in a “standard city”.

6. What Is Included In The “Basket Of Goods”

A typical market basket of goods includes transportation, goods and services (which includes food at home, food away from home, tobacco, alcohol, furnishings and household operations, clothing, domestic service, medical care, personal care, and recreation), and sales taxes.

Some items may be considered variable, such as transportation (if transportation is provided) and schooling (if local schools are deemed adequate) and therefore those may be pulled out of the calculation.

Note: the typical COLA programme covers non-housing expenses. Items such as housing rental, rental insurance, and utilities are covered under the basic allowance specific to housing.

7. Are Transportation Costs, Such As Insurance Or Taxes On A Private Vehicle, Considered Part Of COLA?

Yes, these are included along with maintenance costs, financing costs, cost of gasoline, and all other major costs of owning and driving a private vehicle.

8. If Public Transportation Is Available, Is It Considered In Determining Transportation Costs?

Yes, and this is why transportation is often considered a variable cost. Public transportation is considered in locations

COLA where it is normal and customary for assignees to use public transportation. In some locations, where it is not customary nor recommended to drive, the cost of taxis or car and driver services are considered. Depending on specific circumstances, car and driver may be shared between assignee and spouse/ partner or the accompanying spouse/partner may also be provided with car and driver.

a semi-annual or annual basis. However, the frequency of review is ultimately influenced by corporate culture and may be triggered by changes in family size, salary, fluctuations in currency, or volatility of the exchange rate in the destination location.

9. Is COLA Ever Paid As A Daily Rate In Lieu Of A Per Diem?

Cost of Living Data Providers review the data on a regular basis. Most do it semiannually, though more frequently for volatile locations. Changes occur as a result of the price fluctuation of the basket of goods at home and/or host as well as the exchange rate. Therefore, if there is a price difference for the basket of goods, and/or the home country currency purchases more or less of the host country currency, the purchasing power and the index is impacted.

COLA can replace a per diem, but COLA is generally a monthly entitlement based on a 30-day month and usually meant for long-term assignments or “short”-term assignments that exceed 6 months. Usually COLA is associated with an assignment to bridge the spendable gaps between a home and host location as discussed above.

Alternatively, a per diem is usually associated with a short-term or business trip for only one person with duplicate expenses and is limited to meet the basic needs of the assignee. In other words, a per diem is better suited as a temporary support for an employee who is buying items for personal consumption for a limited time period (such as a business traveller).

10. How Does The Data Provider Adjust For Significant Local Changes Such As Currency And Exchange Rate Fluctuations?

The data provider measures local market costs in each area, including all items in the standard basket of goods and services. Taxes are also considered. Since reviews and surveys take place on an ongoing basis, and changes that occur in the local economy are measured, the results are reflected in the data tables on an ongoing basis.

11. How Often Should COLA Be Updated?

Most companies choose to review COLA on

12. Why might a location’s rate for 2020 be lower than it was in 2019?

Remember: Changes in exchange rates are different than changes in COLA. While currency adjustments can impact COLA, there is not a direct correlation (i.e. a 10% change in the exchange rate doesn’t automatically equal a 10% COLA change).

13. Are The Cost Of Living And The Cost Of Labour Correlated?

Not necessarily! It is more a matter of local economy, spendable income, and cost of goods. With unemployment currently at historically low rates and a renewed war for talent, employees are more selective about accepting an assignment. This is especially the case in locations with a high cost of labour and even greater cost of living such as New York, London, and Geneva. These locations pay higher than average salaries but the high cost of living reduces the amount of money that employees can save.

In sum, as employees are more selective, organisations need to adapt to ensure they get the best talent in the right locations.

Utilising data that can demonstrate the purchasing power between locations and help make assignees “whole” from a compensation standpoint will continue to play a critical role in global mobility management.

LAURA LEVENSON

GPHR, GMS-T Global Practice Leader, Consulting Services, Weichert Workforce Mobility 1625 State Route 10, Morris Plains, NJ 07950 973-397-3968 (direct) 914-483-7079 (mobile) 973-630-3781 (fax) llevenson@weichertwm.com www.weichertworkforcemobility.com

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Seriously… What’s The Point?

Two Sides To Every Story

My name is Chris, I live with my partner Abbie and have a grand total of five kids in my life.

Yes, that’s right… FIVE (and all pre-teen!!). Life is hectic and life is busy, kids are flying around left right and centre each and every day like a never-ending, groundhog day, crazed house party (except with juice and snack boxes replacing the “adult grape juice” and pizza often required).

I also work for a company called Aviva who are a UK headquartered global insurance company. My role in the Global Mobility (GM) team is to develop its purpose, tools and structures to better serve our Global Assignee’s and business units.

I share this with you as, like with all of us, there is more than one side to my story. On one hand, I’m the piggy backing Dad whose daughter finds his stomach a little too cuddly for his liking, alongside the Global Mobility professional trying to demonstrate value in the GM programme for the Growth of the company I work for. As the well said proverb goes… "There’s always two sides to every story”.

Try To Understand

Do we understand the purpose of the Global Mobility teams we operate within?

That there is more than one side to the story of an assignment? That the preconceived rhetoric and understanding often perpetuated (and dare I say encouraged) by ourselves as GM Professionals, may in fact be the very thing hindering the success of our assignments and programmes?

Over the past year, we have been developing our purpose within the GM team at Aviva, reviewing where it is anchored to, and therefore the very reason we exist within Aviva’s People Function. We have collated 3,000 hours of Global Mobility demand data to assess where we spend our time, where we duplicate work, and begin to ask questions as to why our processes are the way they are and how we can do it better.

We have conducted interviews with assignees to understand their experience, collated assignee survey scores to assess our engagement, and spoken to our business units and projects to hear why they are looking to use global moves to develop Aviva as a business. We have begun to listen and consult, rather than command and control.

What Are We Thinking?

But all of this has had to be grounded first and foremost in understanding our purpose and challenging the very thinking that got in the way in the first place. As part of this journey,

we began to see that the role of a Global Mobility function is to benefit our customers.

Not our internal customers, or our employees as customers, but our actual customers. Our policyholders, investors, pension schemes, etc. The Global Mobility function’s purpose was to enable Aviva, through moving the right people, to the right place at the right value, to benefit our 33 million customers.

By anchoring our work in our customers benefit (not on business unit cost or assignee experience as is traditionally the case), we can begin to balance the sides of the stories of an assignment. Assignee requests are understood against the backdrop of their needs instead of employees wanting more; business cost challenges are understood against the backdrop of driving the right customer outcomes (whilst allowing business units to determine their own investment level versus value return). The GM function is now about enabling solutions rather than policing policies.

The GM function is now about enabling solutions rather than policing policies Change Your Thinking To Change Your Outcome

When we challenge the thinking that drives the outcomes which frustrate our purpose and work, we begin to focus on the things that matter to a successful programme. The noisy shouts from within our own industry (which haven’t been answered since the dawn of humanity I believe) regarding Return on Investment, having a seat at the table, developing exception free policies or ensuring everyone in our company is educated in mobility begin to subside.

Instead, they are replaced with active discussion and debate on what really matters to each of our individual programmes. We challenge how we generate value to our business through minimising disruption and impact on the potential return/outcome the business wishes to see. We find a way for talent development, business growth, critical need and employee beneficial moves which can co-exist within the

same framework, with differing benefits. Duty of Care becomes a genuine conversation with an assignee rather than an arbitrary measure of why a benefit must be included.

So What’s The Point?

Fundamentally, the GM Function becomes an enabler of its key stakeholders to deliver the right mobility solution to their problem, rather than find a box to stick them in uttering the words “policy says no”. Our role in our various organisations is much more valuable than simply ensuring policies are adhered to. Instead, we can be the experts providing guidance and compliant solutions to enable business growth and great customer outcomes. Now that’s a GM Function I’m on board with.

“There’s two sides to every story”… challenge our thinking, change our outcomes, serve our customers.

CHRIS BLAIR

Global Mobility Systems Thinking Lead, Aviva Chris is responsible for the Change Management and Function Redesign for the Global Mobility team at Aviva, a Global Insurance Provider. Chris’ focus is on enabling the Function to develop away from policy management and administrative processes into an expert consultation service able to demonstrate clear business value for Aviva’s 33 million customers, it’s customer facing business units and it’s functional group centre and market teams.

Chris has worked within the Global Mobility Team at Aviva, previously as a Global Mobility Manager, since 2016 and prior to this he managed the UK Mobility team, managing Aviva’s UK Visa processes.

Chris lives in a village south of Norwich in Norfolk and in his spare time enjoys music and playing in his band, spending time with his family and following Liverpool Football Club. He’s also partial to a glass (or two) of a good Red wine.

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INTERNATIONAL HR ADVISER WINTER

Bringing Innovative Talent Mobility Solutions To Frankfurt With major multinationals like Volkswagen, Allianz, Siemens, Deutsche Bank, Daimler AG, BMW, Munich Re, and Bosch calling Germany home – and Frankfurt’s position as a central European business and professional consultancy hub – it is an ideal location to explore unique workforce challenges and solutions.

Frankfurt is also one of the world’s most important monetary policy-setting and financial services centres, hosting both the European and the German Central Banks (ECG and Bundesbank), and more than 200 other financial institutions.

But, as in other regions around the globe, Frankfurt’s ability to fully capitalise on business opportunities is challenged by talent shortages and skills gaps – challenges that demand a new workforce approach.

Increasingly, cross-border workers are stepping in to fill that gap.

One Solution: Cross-Border Workers

What exactly are cross-border workers? “Put simply, cross-border workers are people who live in one Member State and work in another”, notes a 2019 study commissioned for the European Parliament on employment barriers in border regions. “Cross-border work differs from migration in that workers’ place of residence does not change if they take up employment in a neighbouring country. Instead, workers maintain their primary residence by commuting on a regular basis to work on a different side of their national border”.

While cross-border commuters in Europe still represent less than 10 percent of the workforce, their numbers are rising, particularly in border regions around Germany and neighbouring middle-European countries. What’s driving the interest in cross-border work opportunities? The desire for something better.

“Whilst there are many motivations to work in a neighbouring border region, one of the most important is the opportunity for individuals to balance well-paid job opportunities with a good quality of life and affordable accommodation in the country of residence,” notes EuroStat.

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With major multinationals like Volkswagen, Allianz, Siemens, Deutsche Bank, Daimler AG, BMW, Munich Re, and Bosch calling Germany home – and Frankfurt’s position as a central European business and professional consultancy hub – it is an ideal location to explore unique workforce challenges and solutions

Challenges to Attracting Cross-Border Workers

Recruiting cross-border labour is not without its hurdles, however. Addressing those can help a business more effectively compete for top talent, and ensure that top workers secure the best jobs. Among the challenges are: • Tax and immigration. Countries are developing an increasing amount of regulations around cross-border labour to ensure they collect taxes and social security contributions, causing tax and immigration authorities to more regularly exchange data. Companies must consider tax-effective compensation packages and ensure compliance for cross-border employees. These policies can be extremely costly from both a financial and administrative perspective.

• Language barriers. The potential crossborder commuter must be able to sufficiently speak the country’s language to do the job and navigate the country.

“The inability to speak the language of a Member State across the border not only hinders the chances of an individual to find work in another country, but also limits the extent to which different national administrations can really work together,” noted the EU researchers.

• Access to the workplace. How will the cross-border workforce travel back and forth to work? Long wait lines at border crossings and non-harmonised ticket pricing systems are deterrents to moving workers across borders. And once in country, workers must navigate by car or public transportation through their work week. A savvy employer might help ease that challenge by assisting with car or public transportation access and costs.

• Benefits. Generally, cross-border workers are subject to the social security law of the country in which they work. In Germany, your cross-border workers also can qualify for benefits for children up to age 18.

• Information gap. To attract top crossborder talent, employers must do a better job of communicating job opportunities, country requirements, and benefits of cross-border work with their company. Social and digital media can help attract, develop and retain talent and foster greater cross-border collaboration.

FRANKFURT, GERMANY • Socio-cultural differences. As many as 20 percent of respondents in a 2019 survey said perceived cultural differences made them less likely to seek cross-border work opportunities. Without accurate information about culture, work conditions and pay, prospective mobile workers may think twice about seeking work across the border.

• Education and Qualifications. One of the biggest barriers to working across borders is inconsistency in recognising education and qualifications. In some regions, simply recognising university diplomas can be a lengthy undertaking, and translating those documents costly for prospective employees. Coordination and cooperation between governments and business groups is important to streamline the process for faster, easier vetting of applicants.

Innovative Approaches to Workforce Mobility

As companies seek innovative ways to source and develop the talent and skills they need, approaches such as cross-border commuting, short-term or rotational assignments, and remote and project-based work are on the rise. Successful navigation of business transformation while developing a workforce with the right blend of skills calls for an integrated approach between companies, government and institutions of higher learning.

Learn more about these, and other innovative EU workforce mobility solutions, at the Worldwide ERC® Frankfurt Mobility Summit on 12 February 2020. Our contentfilled day event in Frankfurt will bring together a blend of skills and perspectives to foster collaboration on current challenges and opportunities. Join 200-plus expected delegates from more than 120 organisations worldwide as we explore the innovative mobility approaches to attract new global talent, build skills and foster business growth.

The event will take place on 12th February, 2020 at the Intercontinental Frankfurt, Wilhelm-Leuschner-Straße 43, 60329, Frankfurt am Main, Germany. For further information: www.worldwideerc.org/eventsdirectory/frankfurt-summit/home.

What’s driving the interest in cross-border work opportunities?

NOURAN ZARROUG

Nouran Zarroug heads up the EMEA Region for Worldwide ERC and is based in London. Nouran’s career spans working and living across 2 continents and having been a 3rd culture kid herself is deeply passionate about the Mobility industry and truly understands the challenges that come with it. Nouran has over 10 years’ experience working across both the Talent Mobility and Business Travel sectors where she has supported many multinational organisations on their cross-border talent strategies. For more information on Worldwide ERC and their learning and event platforms, please contact Nouran via: NZarroug@worldideerc.org

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INTERNATIONAL HR ADVISER WINTER

Living And Breathing The Language Any organisation wishing to send an employee abroad must do so with great consideration. Not only must you send the right person to the right place at the right time, you also need to ensure your time and money injected into the process is worthwhile. This is where having a good grasp of the local language can make all the difference.

More than 80% of EU countries already have a language requirement tied to immigration criteria, so learning the language and understanding the culture is vital.

Not forgetting that learning a foreign language has the power to break down communication barriers and foster greater cultural and human understanding – ideal for building a successful business.

Moving abroad can also be mentally challenging for employees and their families.

Even in a country that appears to be similar to where they live, there may be language barriers and cultural differences they hadn’t expected. It could take them a while to feel settled and get fully up to speed in their new work environment.

Imagine being unable to communicate with not only colleagues, but doctors, dentists, schools, even in the supermarket. Not knowing the local language can often make employees feel isolated and disorientated, and they may sometimes experience a loss of confidence professionally and socially. Managing this before and during an assignment is critical to adjustment in the new location.

Companies should also consider return on investment. There must be assurances that once the assignment is over, the relocating employee – with all their valuable cultural and language skills – will stay with your company. Your company should then benefit from all the experience and knowledge that they have gained.

58% of these moved because of their career. Suffice to say that many of those will have been faced with typical relocation challenges: trying to work out where to live, the customs and the local transport system.

Imagine how much easier it would have been if they had received professional support with learning the language?

A significant 38% of businesses consider language skills helpful in building relationships with clients, customers and suppliers3, so any investment your company makes in “onboarding” your employees will support success in the future. Conversely, KPMG’s Global Assignment Policies & Practices Survey identified that only 40% of companies surveyed offer language training to employees and family members4.

International Relocation: Top Challenges

There are five key challenges a company will face when relocating abroad. These include:

1. Ensuring Your Return On Investment

66% of businesses are known to operate international relocation projects5. The reasons for this are multiple, from increasing operational efficiencies and business to greater market penetration or the transfer of knowledge. Yet with international relocation so popular, many business leaders will be questioning its value and the return on investment they expect to see. In fact, only 58% of overseas assignments are deemed to be successful, so leaders have every right to be cautious6.

Companies must only send their best and brightest. It takes guts and dedication to make a real success of it, and this includes being

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willing to learn the language. The relocating employee needs to feel they have the full and personalised support of your company, before, during and after their relocation.

This includes providing language skills training that fits in with their daily lives, integrating with the new team and support post assignment when they return home. The board will perceive the project as an expensive failure if anyone returns home early.

2. Ensuring Optimum Performance From The Outset

Taking time to get “settled in” is not ideal for companies sending staff abroad. It may be tough, but any lost time has an associated cost, so you need to ensure that your relocating employee hits the ground running (almost) as soon as they have unpacked their bags.

This means accelerating their adjustment through preparation. It will include ensuring they have access to language training (at home, in the workplace or on the move), supporting them with finding accommodation and facilities, familiarisation of the area and cultural differences. Providing a positive experience from the outset is key; there’s no room for negativity if you’re looking for optimum productivity.

The National Foreign Trade Council estimated that assignment failure rates could be as high as 50% if you consider failure to be early return, compromised performance or resignation upon repatriation7.

Many global companies want great value from their mobility programme and great relocation experiences for their people.

However, they also need to consider additional requirements. Choosing the right mobility partner offering the full mix of skills and education options ensures that there is no compromise in the process.

Case Study: Marrying Language And Culture

Company A sent a small advanced group of employees to Japan to pave the way for

SUPPORTING RELOCATING EMPLOYEES a two-year project. Their role was to build relationships with local influencers and political figures as well as identify and engage local vendors and partners.

Recognising the complexity of Japanese culture and language, Company A engaged us to deliver cultural and language training programmes to prepare their employees.

We set realistic linguistic goals and created a curriculum that: • Built basic vocabulary and grammar rules to be able to greet local contacts, make basic introductions and demonstrate respect for Japanese culture and contacts • Identified how Japanese language could illustrate the formality and nuance of Japanese culture.

The students were motivated and progressed well through their lessons over the course of the first year. A sister entity has now approached us to discuss a similar programme for their Japan-bound employees.

3. Getting Partners And Children On Board

Ensuring partners and children are settled is equally as important as ensuring your employee is. In fact, it can be even more challenging for a spouse to integrate into their new society than anyone else. Your employee has their workplace and a structure there; the children have their school life and a routine. Often it can be more difficult for the spouse who may not have a job in the new country.

They may not know the language and they probably won’t know anybody at all – or have a way of making friends. If they become unhappy it’s highly likely the assignment will fail, so it’s important to include them in your onboarding plans. Ensure they are included in learning the new language and intercultural training. Make sure they don’t lose their confidence through making any cultural faux pas. You could also give them objectives such as joining groups, both local and expat, or organise excursions so they get to know the area. They could also be interested in volunteering or paid work opportunities if their visas allow.

4. Preparing The Receiving Team

It’s important not to forget the impact employee relocation has on the people in the office they are relocating to. They may be unaccustomed to working with foreigners and there’s a chance it will cause disruption, particularly at the beginning of the assignment. Ensure you have fully informed the staff why there will be a new person working in the office, why you chose them for the job and the skills they will bring to the team.

Encourage team events where the language barrier might be less of an issue: simple social activities will help with team

bonding, more so than just meals out or drinks where language barriers can become an issue. Introducing a buddy system will also help employees with getting to know one another. You must also provide intercultural training for the receiving team, particularly if this is the first relocating employee that will be in the office or if they are to be their direct manager.

According to PWC’s research calculating the ROI of international assignments across nine organisations, companies were losing up to 40% of returning relocating employees within 12 months8.

According to PWC’s research calculating the ROI of international assignments across nine organisations, companies were losing up to 40% of returning relocating employees within 12 months 5. Readjusting During Repatriation

Returning home at the end of an assignment is actually more unsettling than most people think. There may be an element of initial excitement at the thought of seeing friends, family and familiar places. Yet once the novelty has worn off, your employee will need to readjust to living back in their own country. This could mean getting used to the climate, food, working styles, the people and a new routine.

It is often a time when employees start thinking about moving on once again, to a new job, a new company or a new country.

Yet, what is most important for your

company, is that they stay on with you and you benefit from the knowledge and language skills they have gained during their stint abroad.

Your company invested in them and you need to do all you can to keep them employed to protect your ROI. Support them with settling back into your offices, their new role and their surroundings. They will appreciate your understanding and be more inclined to stay on with you.

Case Study: Using Language To Accelerate Adjustment

Company B moved a large number of employees and their families to China ahead of a launch.

Their primary focus was the need for relocating employees to quickly be able to work effectively with local hires – many of whom had limited English skills. We scheduled individual lessons to accelerate learning and focused the lesson plan on workplace vocabulary acquisition.

To provide more flexibility in delivery, students were given the option to take virtual lessons. Company B also recognised that for these assignments to be successful, accompanying family members also had to be able to adjust to the host location and that offering language learning to them was equally critical.

For these students we focused on building more “daily living” linguistic skills, with some of the lessons delivered in supermarkets and coffee shops to capitalise on learning by using the language.

Conclusion

For a successful international relocation and to generate a positive ROI, tailored support and education are needed before, during and after the assignment. It’s important to remember that language skills cannot be learned in a matter of weeks, and this is why flexibility in language learning is so important.

Very few people have the time or inclination to spend in evening classes in the run-up to their relocation. These days we are all accustomed to using technology for rapid access to information – and language learning should be no different.

Access to learning must be made available to employees through the technology they use every day. It should be accessible wherever they are and whatever time of day it is. Language learning should be fluid, lived and breathed.

Over the last 50 years, we’ve seen and supported all types of international relocation scenarios. Now, in order to expand the portfolio of services we offer, we have partnered with Learnship – with more than 1,000 trainers worldwide – to provide language lessons to our clients.

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INTERNATIONAL HR ADVISER WINTER

This partnership enables us to add virtual instructor-led language training to our current onsite offering and support a positive assignment ROI. Through Learnship we combine transformational technology and progressive instruction methods to create the ultimate language learning experience.

References: 1 www.right.com/wps/wcm/connect/rightus-en/home/thoughtwire/categories/ talent-work/reduce-the-risk-of-managersfailing-in-overseas-assignments 2,3 w w w . t r a i n i n g e x p e r i e n c e . o r g / blog/2018/11/07/6-facts-working-abroadwill-make-understand-expats-better/ 4 w w w. h o m e . k p m g / x x /e n / h o m e / insights/2016/10/global-assignmentpolicies-and-practices-survey-2016.html 5 www.insightsforprofessionals.com/blog/ benefits-of-sending-employees-abroad 6 www.right.com/wps/wcm/connect/ r i g h t - u s - e n / h o m e / t h o u g h t w i re / categories/talent-work/reduce-therisk-of-managers-failing-in-overseasassignments 7 www.nftc.org /default/hr/GRTS%20 2003-4.pdf 8 www.pwc.fi/fi/palvelut/tiedostot/pwc_ measuring_the_value.pdf.

It’s important to remember that language skills cannot be learned in a matter of weeks, and this is why flexibility in language learning is so important

JOANNE DANEHL

Global Director, Global Skills This whitepaper was written by Joanne Danehl, Global Director, Global Skills.

Joanne’s leadership helps Crown to deliver training solutions that meet clients’ corporate goals and the needs of their relocating employees. She works with individuals and teams around the world to provide the support services that are key to a successful relocation.

Joanne has worked in commercial training for over 20 years and global mobility for more than 15 years.

If you have any questions regarding this article or would like to find out more about our other services, please contact Joanne, jdanehl@crownww.com or visit our website at www.crownworldmobility.com.

The 2020 Expatriate’s Guide to Living in the UK

Pre-order your copies to pass on to your expatriate employees 17th Annu

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The 2020 Guide will contain content covering: Banking & Wealth • Expatriate Clubs • Embassies & High Commissions Driving & Transport • Education – Schools & Universities Healthcare & Hospitals • Immigration & Residency • Legal Issues Moving & Relocation • Residential Lettings Serviced Apartments • Taxation The Guide has been published for 18 years, and each year we share over 25,000 copies with expatriates relocating to the UK. To pre-register for your FREE copy please email: damian@expatsguidetotheuk.com, providing the mailing address you would like it sent to.

In the meantime, please visit our website www.expatsguidetotheuk.com which is the digital platform for the Guide.

Please share the website with friends, family, colleagues or employees relocating to the UK.

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2020 DIARY DATES

INTERNATIONAL HR ADVISER WINTER

FEBRUARY 2020

Expat Academy European Super Huddle

Hilton Amsterdam, Apollolaan 138, BG Amsterdam, 1077, Netherlands 11 February 2020 The day promises to provide a great opportunity for the Expat Academy community to get together, be inspired and informed. With this in mind there will be the opportunity to hear from an expert panel about the triumphs and challenges they have faced in managing stakeholders. We will also break for Huddle sessions giving you the chance to discuss your burning issues and challenges. There will be the chance to listen to a top panel from the world of Global Mobility as they are placed under the spotlight in ‘Question Time’ and be inspired by our keynote, Debra Searle MVO MBE, as she shares her story on achievement against all odds. This event is worth 10 GMPD credits.

To book your place e-mail: bookings@expat-academy.com

Worldwide ERC® Frankfurt Mobility Summit

Intercontinental Frankfurt, Frankfurt am Main, Germany 12 February 2020 The Frankfurt Mobility Summit is a knowledgesharing event shaped by the global, regional and technological developments and innovations that are driving talent mobility.

Join the 200+ expected registrants from over 120 organisations worldwide for a unique networking opportunity. Be part of the conversations and explore the contributions that mobility teams can make as businesses attract new global talent, build skills and create innovative policies to foster growth.

Learn more and register: www.worldwideerc. org/events-directory/frankfurt-summit/home

MARCH 2020

Expat Academy Bite Size Briefing day

BDO, 55 Baker Street, London, W1U 7EU, United Kingdom 3 March 2020 A training day for the Expat Academy community. A chance to listen and learn about the latest tax and immigration updates and industry insights from the Expat Academy team and their technical training partners. The main aim of the day is to provide intellectually challenging content which will enhance your professional development and maintain your specialist GM knowledge. This event is worth 10 GMPD credits.

To book your place e-mail: bookings@expat-academy.com

Worldwide ERC® Singapore Mobility Summit

Raffles City Convention Centre, Singapore 26 March 2020 As business leaders seek to redefine the value of their organisations against a challenging backdrop of disruptive technologies, regulatory uncertainties, changing employee

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and customer demographics and a shortage of skills, you can be at the centre of the solutions. From attracting and retaining talent with digital capabilities, to fostering diverse and innovative global teams, and building the paths to develop agile, entrepreneurial leaders, global mobility is a critical part of the future workforce. Come together with your industry peers in the multicultural metropolis of Singapore for a full-day of exploring smart solutions and innovative ideas that will shape the next generation of talent.

Corporate HR practitioners are invited to attend with a complimentary registration.

Learn more and register: www.worldwideerc. org/events-directory/singapore-summit/home

potential by becoming the engine of Enterprise Transformation. SSOW covers all aspects of Shared Services transformation, including; HR Excellence, People, Culture & Change Management and Leadership & Talent.

Join us for our 20th anniversary and enjoy workshops, discussion groups, keynotes, parties and hear directly from industry leaders and the world’s leading organisations, such as Tesco, Mars, Phillips, Takeda, Mondelez and many more.

Booking details: Learn more about SSOW 2020 by visiting us online at www.ssoweek.com or emailing us at events@ssonetwork.com.

Save 10% off your pass when you register online using code: HRADVISOR.

Expat Academy Dublin Huddle

The Dublin Convention Centre, Spencer Dock, North Wall Quay, Dublin 19 March 2020 The Expat Academy Dublin Huddle is for Global Mobility professionals to come together to share current operational challenges and gain advice from fellow network members. The day’s agenda is built around what the attendees want to cover, and is finalised just a week before the Huddle. With expert input from Expat Academy training partners BDO, Magrath Sheldrick, Cartus and UHCG, the conversations are guaranteed to be of immediate benefit. This event is worth for 10 GMPD credits.

To book your place e-mail: bookings@expat-academy.com

Worldwide ERC® Shanghai Mobility Summit

W Shanghai – The Bund, Shanghai, China 31 March 2020 With a population of nearly 1.4 billion and as the world’s second largest economy, China holds a premier position as a global powerhouse for multinational corporations (MNCs) and business growth. To bolster its internal talent development and competitive edge, China is embracing a combined approach of recruiting global skills, encouraging Chinese nationals who have studied and/or worked abroad to repatriate, and engaging in increased levels of domestic employee relocation. China also continues to invest in its own global expansion and remains one of the leading sources of outbound students enrolling in global institutions of higher learning.

Learn more and register: www.worldwideerc. org/events-directory/shanghai-summit/home

MAY 2020

20th Annual European Shared Services & Outsourcing Week 2020

Estoril Congress Center, Estoril, Portugal 11 - 14 May 2020 20th Annual Shared Services and Outsourcing Week Europe (SSOW) is Europe’s most established event for shared services, GBS, outsourcing and intelligent automation leaders.

With a combination of cutting edge content and one-stop-shopping for all your provider needs, this is where you will unlock your

The 2020 Global HR Conferences

The Global HR Conferences 2020 are taking place on

Monday 16th March & Monday 12th October at Smith & Wollensky, 1-11 John Adam Street, London, WC2N 6HT To register your FREE place at these events, or further information, please email helen@internationalhradviser.com.

Sponsors include:

These events are for Senior In-House Global HR Professionals only

If you would like to advertise a conference or exhibition on our Diary Dates and on www.internationalhradviser.com please email damian@internationalhradviser.com

DIRECTORY

INSURANCE AND FINANCIAL SERVICES ZURICH INTERNATIONAL CORPORATE SOLUTIONS

Tricentre One, New Bridge Square, Swindon SN1 1HN Contact: Adele Cox Telephone: +44 (0) 1793 506775 E-mail: adele.cox@zurich.com Website: www.zurich.com Zurich International Life is a global provider of life insurance, investment and protection products. Our corporate range offers flexible, portable solutions, designed to suit multinational organisations with an internationally mobile workforce. The International pension plan offers a cost effective, bundled retirement benefits solution comprising of trust services, investment funds and online administration.

International group protection is designed to protect an employers’ most important asset – their employees – and offers a range of life and disability protection.

With a local presence in key global business hubs and over 30 years experience of implementing and administering plans world wide, we’ve developed our knowledge and understanding of key markets to meet the needs of our customers and business partners.

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 GOSSELIN

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@gosselin-moving.co,uk Website: www.gosselin-moving.co.uk Gosselin is a world leading international relocation company, serving corporate customers all over the globe with an awardwinning* move management and destination services programme.

Through our London headquarters and unrivalled footprint of 56 global offices we help clients achieve their workforce mobility goals.

Every employee we relocate is appointed a dedicated move manager, who is a central point of coordination, support and advice to ensure every part of the relocation runs smoothly.

Our goal is your complete satisfaction, and with a 97% customer satisfaction rating for 2018, we offer unrivalled quality at competitive rates. *Awarded 12 global relocation awards since 2010.

RELOCATION SANTA FE RELOCATION SERVICES

Central Way, Park Royal, London, NW10 7XW Telephone: +44 (0)208 961 4141 Website: www.santaferelo.com Santa Fe Relocation Services is a global mobility company specialising in managing and delivering high-quality relocation services worldwide.

We enable people and organisations to work, live and thrive around the world.

With ‘enabling people and organisations’, we want to make it possible for people to be where they need or want to be - enabling people and organisations.

Our core competence is relocation services that support corporations and their employees relocate and settle in a new country, assisting them with immigration, home and school, language and cultural training, managing property rentals, delivering domestic and international moving of household goods.

We provide these services to a consistent high standard, locally and globally. A key aspect is being able to manage our service delivery through Santa Fe operations across six continents.

TEAM RELOCATIONS – A SIRVA COMPANY

54 Queen Anne Street, Marylebone, London, W1G 8HN Contact: Tony Thurlow Telephone: +44 (0) 20 8955 1364 Email: Tony.Thurlow@teamrelocations.com Website: www.teamrelocations.com Twitter: @TeamRelocations LinkedIn: www.linkedin.com/company/teamrelocations/ Team Relocations is an independent company specialising in delivering fully integrated relocation, moving and other associated services primarily within the corporate market.

For over four decades, we have been delivering these services on a global, national and regional basis to many of the world’s leading multinational organisations and government agencies. Our strong reputation for high quality service and proven track record put us among the leaders in the mobility industry.

RELOCATION ASSOCIATIONS ASSOCIATION OF RELOCATION PROFESSIONALS (ARP)

9&10 Diss Business Centre, Dark Lane, Diss, Norfolk, IP21 4ND Contact: Tad Zurlinden Telephone: +44 (0)1379 651 671 Fax: +44 (0)1379 641 940 Email: enquiries@arp-relocation.com Website: www.arp-relocation.com The ARP is the professional association for the relocation industry in the UK. The ARP’s activities include seminars throughout the year, an annual conference, the publication of an annual Directory of Members and a website, which is updated regularly.

THE EUROPEAN RELOCATION ASSOCIATION (EuRA)

9&10 Diss Business Centre, Dark Lane, Diss, Norfolk, IP21 4ND Telephone +44 (0)1379 651 671 Fax: +44(0)1379 641 940 E-mail: enquiries@eura-relocation.com Website: www.eura-relocation.com EuRA is an industry body for Relocation Professionals in both Europe and Worldwide.

EuRa have launched The EuRA Quality Seal, the world’s first accreditation programme for relocation providers. This pioneering initiative provides a straight forward, cost effective audit to reflect your company’s excellence in providing relocation services.

SCHOOLS ACS INTERNATIONAL SCHOOLS

ACS International School Cobham Heywood, Portsmouth Road, Cobham Surrey, KT11 1BL, England ACS International School Egham London Road (A30) Egham, Surrey, TW20 0HS, England ACS International School Hillingdon Hillingdon Court, 108 Vine Lane Hillingdon, Middlesex UB10 0BE, England ACS International School Doha Al Oyoun Street, Al Gharrafa PO Box 200568, Doha, Qatar Telephone: 01932 869 744 Email: cobhamadmissions@acs-schools.com Website: www.acs-schools.com Contact: Dean of Admissions ACS International Schools were founded in 1967 to serve international and local communities. The schools are non-sectarian and co-educational (day and boarding), enrolling students aged 2 to 18 years. The UK based schools have over 30 years’ experience of teaching the International Baccalaureate, and ACS Doha offers an international and American curriculum.

TASIS THE AMERICAN SCHOOL IN ENGLAND Coldharbour Lane, Thorpe, Surrey TW20 8TE Contact: Simon Fitch Telephone: 01932 582316 Email: ukadmissions@tasisengland.org Website www.tasisengland.org

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INTERNATIONAL HR ADVISER WINTER

TASIS England's diverse student body includes over 50 nationalities and many in the school community have experienced the challenges of relocation. Along with well-established welcoming programs, families receive ongoing support as they cope with the practical and emotional aspects of their transition to life in the UK. Taught in small classes, students (ages 3–18) benefit from a balance of academics, arts, athletics, activities, and service leadership.

Excellent exam results and one-to-one college counselling enable 97% of TASIS graduates to gain acceptance to their first- or second-choice university in the UK, the US, and worldwide.

SERVICED APARTMENTS THE ASSOCIATION OF SERVICED APARTMENT PROVIDERS (ASAP)

Suite 3, The Business Centre, Innsworth Tech Park, Innsworth Lane, Gloucestershire GL3 1DL Contact: ASAP Office Telephone: +44 (0)1452 730452 Email: admin@theasap.org.uk Website: www.theasap.org.uk Twitter: @ASAPThe LinkedIn: The Association of Serviced Apartment Providers ASAP is in the industry association representing, promoting and improving the serviced apartment sector. Our 124 members including serviced apartment operators and agents represent in

excess of 25,000 serviced apartments in the UK, Europe, USA and Canada.

When booking your serviced apartment, look for our Quality Accreditation kitemark which confirms the operator is fully compliant with all the core legal, health and safety practices and means you can book with confidence.

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 1500 offices in 162 countries.

We have a partner-led approach, which delivers the highest quality of service by using short, functional chains of communication to aid decision-making. Clients benefit from our fresh thinking, constructive challenge and practical understanding of the issues they face. Developing strong, personal relationships with our clients is at the forefront of our service approach.

Tax advice is just one of our award-winning services and our expatriate team give practical and direct advice, delivering solutions which suit your needs.

GLOBAL TAX NETWORK LTD

Norwich House, 14-15 North Street, Guildford, GU1 4AF Contact: Richard Watts-Joyce CTA Telephone: +44(0)20 7100 2126 Email: rwattsjoyce@gtn.uk Website: www.GTN.uk Twitter: @GTN_Tax LinkedIn: www.linkedin.com/company/globaltax-network Global Tax Network Ltd is the UK member of Global Tax Network (GTN), an international affiliation of professional firms in over 100 countries specialising in global mobility tax consulting. We provide assistance to employers with the tax administration of international assignment programs and private client services to high net worth individuals, non-domiciles, professional sportspersons and entertainers.

Our consultants include members of the Association of Taxation Technicians, Chartered Institute of Taxation, and US Enrolled Agents.

To advertise your services to our Global HR readers in this Directory please email damian@internationalhradviser.com for further information.

Helen Elliott & Damian Porter would like to wish all our clients and readers a very Happy, Healthy & Prosperous 2020

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