Lump Sum Application

 

The consistent use of lump sums by roughly half or more of firms continues to prompt deeper investigation. The survey again asked which costs are covered and to whom lump sums are applied. We noted some big shifts. Roughly twice as many firms use lump sums to cover real estate assistance/transactions (28% vs. 11%+) or rental assistance/transactions (32% vs. 16%+) than did in the previous four years on average. At the same time, the percentage of firms using lump sums to cover miscellaneous allowances has dropped markedly (40% vs. 53%+). The percentage of firms using lump sums to cover household goods shipping/storage appears to be trending upwards as well (37% vs. 28%+). These changes appear to be driven primarily by the ways in which mid-size and large firms are using lump sums. Overall, the use of lump sums for other expenses has remained fairly consistent since we started measuring them.

  • Overall, large firms are more likely than small or mid-size firms to use lump sums for miscellaneous allowances (55% vs. 37% and 31%) and temporary housing (53% vs. 32% and 35%); these are the top two ways large firms apply lump sums.
  • Mid-size firms show a greater likelihood than small firms to use lump sums for real estate assistance/transactions (36% vs. 19%) and rental assistance/transactions (40% vs. 25%). Mid-size firms are also more likely than large firms to apply lump sums for household goods shipping/storage (43% vs. 30%).
  • Regardless of size, roughly two-fifths or more of firms use lump sums to reimburse the entire relocation cost or travel expenses.

The use of lump sums across employee types continues to evolve. When first measured in 2011, around half or more of firms said most employee types, except for homeowners, commonly received lump sum payments. Gaps began widening in 2012, and in 2013-2014 new hires were more likely to receive lump sums than transferees, and employee level was less a factor than new hire status. This year reveals marked changes in the use of lump sums compared to the previous four years on average: far more firms now use them for executives (54% vs. 32%+), and far fewer use them for entry level employees (37% vs. 49% on average), for new hires (43% vs. 59%+), for renters (28% vs. 39%+), and for homeowners (19% vs. 28% on average). Many of the declines are driven by mid-size and large firms reducing the usage of lump sums for different employee types over the past four years, while the increased use for executives is driven largely by mid-size firms. Only two applications were similar to the past four years on average: for experienced professionals (52%) and for transferees (43%).

  • Regardless of company size, around half of firms say executives or experienced professionals typically receive lump sums.
  • Among large firms, roughly half use lump sums across employee levels and relocating employee types; far fewer base lump sum offerings on renter (35%) or homeowner (27%) status.
  • Transferees are more likely to receive lump sums from mid-size or large firms versus small firms (49% and 46% vs. 35%). New hires are more likely to receive lump sums from small or large firms than from mid-size firms (50% and 44% vs. 35%).
  • Large firms are more likely than small or mid-size firms to provide lump sums for entry level employees (51% vs. 28% and 35%).

As lump sum usage has grown, the survey has incorporated additional questions about the ranges offered for various categories of reimbursement. Compared to the past two years, amounts are more generous and used more frequently for a variety of reimbursement types. However, overall median ranges for temporary housing and miscellaneous allowances, albeit higher than in 2013, were the same as 2014, although these did see changes by company size.

  • Median amounts offered by mid-size and large firms were the same for the following categories (small firms were slightly less generous): household goods shipping/storage ($5,000-$9,999), travel expenses ($2,500-$4,999), and miscellaneous allowances ($2,500-$4,999).
  • Median amounts offered by large and small firms were the same for the following categories (mid-size firms were slightly more generous): entire relocation cost ($10,000-$14,999), real estate assistance/transactions ($5,000-$9,999), temporary housing ($2,500-$4,999), and rental assistance/transactions ($1,000-$2,499).
Question 32a-1
For what types of relocation costs are lump sum payments typically offered?
Chart Q32a
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Question 32a-2
For what types of relocation costs are lump sum payments typically offered?
Chart Q32a2
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Question 32b-1
What types of relocating employees most commonly receive lump sum payments?
Chart Q32b
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Question 32b-2
What types of relocating employees most commonly receive lump sum payments?
Chart Q32b2
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Question 32c-1
What are the typical ranges of lump sums offered?
Chart Q32c
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Question 32c-2
Typical range for lump sums payments - real estate assistance
Chart Q32c-2
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Question 32c-3
Typical range for lump sums payments - household goods shipping
Chart Q32c-3
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Question 32c-4
Typical range for lump sums payments - entire relocation cost
Chart Q32c-4
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Question 32c-5
Typical range for lump sums payments - rental assistance
Chart Q32c-5
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Question 32c-6
Typical range for lump sums payments - travel expenses
Chart Q32c-6
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Question 32c-7
Typical range for lump sums payments - temporary housing
Chart Q32c-7
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Question 32c-8
Typical range for lump sums payments - miscellaneous allowances
Chart Q32c-8
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