As we move into the post-Covid era, most companies seem to be solidifying their stance on relocation policies. Knowing that remote and hybrid work is here to stay has motivated companies to define their limits. These policies often favor flexible, customizable benefits. Roughly half of formal policies include relocation benefit coverage of specific items (e.g., fixed components/core coverage) (51%), flexible use of full relocation benefit coverage amounts applicable to a list of possible services (49%), and flexible use of a portion of relocation benefit coverage applicable to list of possible services (46%).
The most common fixed benefits in 2022 were covering real estate assistance/transaction costs-origin/selling (48%), rental assistance/transaction costs (39%), and temporary housing (35%).
Companies reported that alternative assignments are typically used in place of long-term assignments (36%) or traditional short-term assignment arrangements (41%). These may be more appealing to the employee as they do not require the commitment and labor of fully relocating. Employee request was the third most cited reason for utilizing alternative assignments (43%), preceded only by business need (49%) and job function (47%).
Roughly 1 in 3 companies stated that they utilize international alternative assignments either on a limited basis (39%) or frequently (31%). 32% are using alternative assignments domestically on a limited basis, and 25% are utilizing them frequently.
2022 saw small and medium companies choosing to facilitate relocations with lump-sum benefits (37% and 36% respectively) over full reimbursement coverage (30%; 31%). Inversely, large companies were more likely to provide full reimbursement (39%) than lump sums (35%). This may reflect the increased capacity of larger companies to dedicate more resources to directly manage relocations.
- Experienced professionals (51%) and executives (47%) are most likely to receive lump-sum payments.
- Domestic relocations are allocated most lump-sum benefits (55%).
- Typical lump-sum amounts are between $10,000 and $12,499 (22%).
The most common services outsourced to relocation services, HRO, or brokerage firms in 2022 were:
- Compensation services (23%).
- Management of full relocation program (22%).
- Arrangement of family’s transportation and accommodations (22%).
- Expense management/tracking/reimbursement services (21%).
These components emphasize the trend towards making relocation simple for both the employee and the employer. Providing management of expenses, transportation, accommodation, and even the full program allows for employees to have a smooth transition into their new position, while outsourcing these services to different providers lets the company stay relatively hands-off.