Relocation occurs for a lot of businesses. When companies expand or need a larger talent pool, moving to a new location is often the best route. However, relocating can be difficult for employees who have to pack up their families and travel great distances to keep their jobs. To make this transition easier on workers, businesses often offer some form of relocation reimbursement.
Reimbursement options companies usually offer include lump sum, full reimbursement, or partial reimbursement. Each method has its own benefits and drawbacks for the company. For example, partial reimbursement will save a business money, but employee satisfaction will probably go down. It's already inconvenient for workers to be uprooted, so the idea of paying for the moving expenses can add extra pressure.
"75% of the time, large companies fully reimburse relocation expenses."
The size of the business and the type of employee seem to be the two main factors in determining reimbursement. For example, according to the 2015 Atlas Corporate Relocation Survey, 75 percent of the time, large companies that have more than 5,000 employees fully reimburse relocation expenses for transferring workers. However, companies that have fewer than 500 employees only pay full reimbursement 55 percent of the time. These numbers also tend to be a lot lower when it comes to new-hire relocations.
While trying to provide reimbursement might seem like a lot of work for employers, it's actually extremely beneficial to the business overall. Here are a few reasons paying for your staff's move can help the company:
Fewer new hires
Relocating employees allows a business to keep workers that are already competent in their positions. Knowledgeable workers are important in every company, and while new hires can be made at the other location, a business still needs someone around who can train them. Providing reimbursement for moving expenses will increase the likelihood of a worker staying with the company instead of seeking other opportunities.
Increase in satisfaction
Offering employees compensation for their relocation is a great way to make workers feel appreciated. The extra incentive shows an employee that the company really values his or her work and loyalty. Receiving this validation from a company will increase employee satisfaction and promote a positive work environment.
If a company's employees are stressed about moving expenses and trying to pack their own belongings, productivity and work efficiency will probably decrease. Being preoccupied at the office will not create quality results from employees. Businesses can help keep stress levels at the office to a minimum by providing relocation reimbursement and services for workers. With less to worry about, employees will be able to focus more on job duties.
Another factor employers should keep in mind when relocating employees is the new city. The cost of living varies from place to place, so it's usually a good idea for businesses to consider expense bonuses for workers. This will help employees maintain their lifestyles and transition to a new space more smoothly.
Ultimately, different reimbursement plans work for different companies, but the important part of a plan is to give the employee the best help possible. Creating loyal workers is important for the success of many businesses, and offering fair relocation packages will help promote that support.