Ask The Expat & International Career Coach: How Do I Make Sure I Get a Fair Relocation Package?

This is the next post in my "ASK THE EXPAT CAREER COACH" blog series that I started in 2009. You can read my very first post in the series: "Why Work Abroad?".

Today's question is another very common question I get when expatriates are trying to cost out whether or not taking a job abroad is right for them and their family.

"HOW DO I MAKE SURE I GET A FAIR RELOCATION PACKAGE?"

Despite the global economic crisis, the demand for highly skilled professionals still exists. Many companies realize that they must must still pay their professionals well if they want to stay ahead in the war for good talent.  If you are clear on your unique value (or personal brand) and have communicated it effectively to the decision-makers, then you should feel confident about negotiating for a relocation package from a position of strength.

However a recent study in International Journal of Human Resource Management reports that companies globally are not recognizing the importance of compensation to in expat retention.  To reduce mobility costs, some companies have been moving to localize their expats or provide local plus packages (traditional expatriate compensation package with reduced benefits).  This has often created the drive or the need for the expat to look for higher paying employment elsewhere.

In fact, recent research tells us that 30% of expats are currently leveraging their increased marketability (by being on international assignment) to explore positions outside of their current organization.  Although companies are becoming more aware of this trend, they are not being as responsive as they need to be to this reality.

 

As this new research comes to light, it is hoped that companies will understand that that their short term attempts at cost reduction will actually affect their ROI in terms of expat retention/attrition. 

So it is very important to be prepared when negotiating your relocation package.  Come to the table with a clear understanding of what you want, what your "non-negotiables" are and what you are eligible to receive so you can advocate for yourself, get your compensation needs met and make informed choices that will work for you.  You might also consider alerting to mobility team to recent research indicating that companies who are requiring their employees to localize or who are offering reduced packages are seeing changes in their expat retention/attrition rates.

I will be writing a future blog post that gets into all of the elements of an expat relocation package and things you need to make sure to consider.

YOUR EXPAT CAREER & BUSINESS SUCCESS TIP: If you are an expat in the process of negotiating your relocation package, make sure you do your homework.  Be sure you request all documentation from HR regarding the benefits available to you. Many companies are making changes to relocation/salary packages at the moment so there may be more room to negotiate than you think. Stay tuned for a future blog post where we explore the elements of a relocation package in more detail.

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Comments

[AnneEgros]

Thanks Megan to raise awareness on relocation package.

This negotiation is crucial, yet some expats don't do their homework and follow blindly what their HR department or relocation companies tell them.

Wherever you go, make sure you search facts and collect opinions from people living in your target neighborhoods. If you have children look for schools first then decide on housing. Location, housing and schools are tied to the the expatriation success as an unhappy family and frustrated trailing spouse is linked to higher % of expatriation failures.

[Kell]

Megan
Thank you for the posting.
I am currently an expat which is in the scenario you mention above and is being localized after 5 yrs in UK. I have been trying to retain at least 80% of my housing allowance in some form via direct payment. The only offer made by my company with this aspect has been to include the allowance in my discretionary bonus payments. I am very uneasy as my company does not want to sign a formal document and as stated it is part of a discretionary bonus which has the potential to be equitized.
It seems I have little leverage apart from taking what is being offered or look elsewhere.
Any suggestions or strategies would be greatly appreciated.

[Megan Fitzgerald]

Hi Kell,

Thanks for your comment. Indeed things are changing and compensation is definitely one of the areas that expats have been struggling with since the global recession hit and companies are tightening their belts.

Getting things in writing is always a good idea. Giving specific feedback would require more information about your current situation, but I would suggest first getting informed about how they are compensating other localized expats so you can get the lay of the land. Speaking with others who have been localized is always a good strategy to see what has worked with others. If others have hit the same wall you have they can tell you what has not worked too - also good information. Sometimes its about looking at your specific circumstances and getting creative. Stick with it - companies do need to compensate their best talent if they want to stay competitive, regardless of the economic climate. I may post more on this topic if I get other comments here. Stick with it - sometimes it just takes time to find workable solutions.

My best,
Megan

[Career Coach]

The blog was absolutely fantastic in this article.!!