CapRelo Blog

Job Relocation: Why Employers Should Invest in Language Training

Posted by Jim Retzer on Tue, Jul 22, 2014

languages

For an employee, being relocated by his or her employer can be an unnerving process. Yet millions of people move every year at management's request, some of them moving globally to a place where the primary language spoken is different. Your employees will likely face language barriers, cultural barriers, perhaps even discrimination depending on where they are moving to and from. An global move must be managed very carefully, paying close attention to the needs of the person(s) being moved; language training is one very important part of the relocation process.

Find out more about managing global relocations in our free article.

Why Language Training?

It is not difficult to imagine what it would be like to be dropped into a country where you don’t speak the language. There is nothing worse than being lost in every sense in a foreign place. At the very least, one should have some idea of the language well in advance of leaving. Learning to speak a new language is a challenge at best for 99.9% of adults but there are accelerated learning programs available if one’s employer is willing to invest in courses for employees being moved.

Who Benefits?

Who benefits from language training? All parties involved benefit in one way or another. For the employee being moved, language training more fully prepares them for living and working in another country. The better they communicate with their new co-workers, the quicker they will be able to resume work and get back to full productivity. Struggling with the language can be costly in man hours spent correcting issues created by poor communication. Employees feel less stressed with fewer cultural and lingual barriers, and employers benefit from increased productivity as a result. There will be fewer complaints if all parties are speaking and understanding local language and culture, lessening the negative effects of an international relocation.

The Bottom Line

Every dollar invested in language training for employees who are relocating to another part of the world is a dollar well spent. The return on investment in cases such as these is profound. Not only does the employer retain an employee, they relocate a well-prepared employee who will be ready to hit the ground running once the relocation is complete. The employee is happy, his/her new co-workers are happy that their new peer speaks their language. Communication errors are less of a risk and productivity can resume without too much culture shock when the employee is prepared for it ahead of time. Language training: it’s a win-win proposition.

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Topics: job relocation, language training, relocating employees, international relocation services, global mobility, global relocation

Managing Global Relocation Expenses and Expatriate Salaries

Posted by David Macpherson on Wed, Jun 19, 2013

Global Mobility PoliciesManaging and controlling global relocation expenses and assignee compensation is always an employer concern. This is both natural and valid. Global relocations are often vital to company success.

Find out more about developing a global relocation policy in our free guide. 

Consider the following realities.

  • First, the company must accept that global transfers are costly. 
    It is impossible to attract the best employees without being the best employer. Attracting and retaining the highest performing employees demands that companies offer competitive relocation programs--US and internationally.

  • Second, managing these costs, while remaining competitive, is a challenge companies can overcome. 
    Take into account any currency differences to reasonably manage the costs of global relocations. Offer the assistance outstanding employees want, while being frugal wherever possible.

  • Third, compare compensation levels in the host country of the assignee, to arrive at salary control. 
    If the assignment is classified as 'short-term' with a rather rapid return to the US, you can use American compensation as your benchmark. However, when a long-term stay is projected, use the compensation range for the host country, assuming it is reasonable and appropriate for the assignees' responsibilities.

Expatriate Employee Expectations

It is unreasonable to expect global transfers to be successful without examining competitive salaries and cost of living issues in the host country. It can be equally unreasonable to assume that top employees will accept such a major move without appropriate compensation.

Losing money is not a transferring employee's expectation. As exciting as a global relocation may appear to your proven employee and/or new hires, their positive anticipation will dim rapidly and, possibly, permanently if the basics of their former compensation are not duplicated.

Managing Relocation Expenses

While it may be numerically impossible to anticipate and/or reduce many global relocation expenses, companies can manage them by applying foresight and comparing competitive offers. Some suggestions that have worked consistently include, but are not limited, to the following.

  • Control the subsidy level of cost of living allowances. 
    Whether you lower former subsidy levels or set maximums applicable to all global relocations, the company will reduce and manage these costs effectively.

  • Cap relocation housing monetary subsidies. 
    While host locality real estate values are outside of your control, you could cap housing allowances in light of home values in the immediate area of the country where your transferring employee will work and live.

    All subsidies should be adjusted on a quarterly basis to take into account currency fluctuations and other fluctuations in the local area.

  • Require the assignee to make contributions to related housing costs. 
    Typically, your company is not mandated to provide zero cost to the assignee. If the competitive environment permits, you can require the assignee to reasonably contribute to housing costs.

  • Find lower cost requirements for home finding trips, language training and assimilation services. 
    Do your homework. Search for lower cost alternatives to the major components of your global relocation services. Get quotes from top professional relocation firms, who may have already done an extensive analysis of providers and costs, which may save you money.

These tips will allow you to manage your global relocation costs and assignee salaries. Certainly, to attract and/or retain your top employees, you'll need to maintain your competitive edge. However, if the company is reasonable with their transfer offers, it will benefit from controlling and managing these costs as described.
 

 
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Topics: international relocation expenses, international relocation services, global mobility, global relocation

How To Reduce Global Relocation Expenses

Posted by David Macpherson on Tue, Jun 04, 2013

International RelocationGlobal relocations will cost employers dearly. However, not offering competitive relocation programs typically cost employers much more over the long-term. That doesn't change the wisdom of managing, controlling and cutting some global relocation costs wherever possible.

Learn more about global mobility and developing global relocation policies in our free guide. 

Assignee Compensation

Your company may or may not consider assignee salaries as a pure relocation cost. Yet, if the employer needs another staff member to complete the duties of the assignee, these salaries do become another relocation expense. Companies have two primary options for determining assignee compensation.

  • Home-based approach. While allowing for potential currency value differences, employers can offer salaries that match compensation applicable to equal responsibilities in the home country. Particularly valuable in retaining employees targeted for shorter term functions in different countries, this method often creates apples-to-apples comparisons for employees contemplating global relocation. This keeps the employer competitive with other companies.

  • New location comparison. Employers can also offer equitable compensation, while controlling costs, by duplicating new country compensation levels for similar positions. Regardless of additional benefits the employer offers, managing salaries based on similar responsibility levels is typically fair and equitable for the assignee.

Cost Cutting and Control Measures

Depending on your industry and competing company’s relocation policies, there are potential costs that can be reduced and managed to benefit the employer. Carefully assess the competitive environment for talented employees in both the home and host location. Taking any of these measures without such an evaluation might be risky if you want the best of the best talent.

  • Reduce 'hardship' bonuses and compensation. Liberal relocation policies often include hardship rewards for loss on home sales, bonuses for fast home sales and compensation for relocation quality of life issues. To save money, some companies reduce these awards and/or modify policy language to cap these monetary reimbursements.

  • Control cost of living allowance. Host country cost of living issues affect residents, either positively or negatively. Cutting or strictly controlling company subsidies for assignees can save considerable relocation costs.

  • Cap housing duplication and subsidies. If your relocation program includes promises or guarantees of duplicating the assignees' former home in the new location, you could re-evaluate the extent of this feature. For example, it may be nearly impossible or much more expensive to duplicate the assignee's former home in some countries. Eliminate enforceable guarantees and/or cap housing assistance to assignees. Another variation is to require the assignee to contribute some portion of the cost of duplicating his or her former home in the host country.

  • Reduce or cap reimbursement for house hunting trips. While difficult to eliminate home finding trips to the new location, international air fares alone for the assignee and family can be expensive, before housing and meals even enter the equation. Reduce former reimbursement policies and/or cap the monetary reimbursement level to cut some international relocation costs.

You can search for other potential awards and reimbursements, even minor ones, in your relocation program. Companies sometimes find that numerous minor cuts and caps, when added together, offer substantial savings and cost control. Often, these limits do not affect the assignee in a negative manner.

The company still must offer competitive global relocation programs to get the employees they want. However, there is no verifiable reason to offer awards and reimbursements that 'blow away' the competition. Should the company want to do so, they will reap many benefits. The question remains that you must weigh the benefits versus their costs to ensure that your global relocation policy accomplishes the goals the company craves.

In so doing, you'll offer relocation policies that employees want, while also reducing and controlling the short-term costs involved. The company will still have happy, productive assignees along with equally happy stockholders, finance department management and controlled expenses that tend to create impressive financial statements.

 

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Topics: international relocation expenses, international relocation services, global mobility, global relocation

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