Does your Relocation Policy Need a Transfer of Ideas?

In these economic times, it is pretty common for the regular guy on the street to know someone who has had to relocate to keep or find a job—it might even be himself. But most people don't think very often about the other side of the coin, the side that business owners and company managers cannot avoid: needing to relocate employees.

There have always been business cycles, and relocation plans have been around for millennia, just ask a nomadic tribesman. The nomads, however, could pack up their yurts and take their houses with them. Today's businesses have their problems complicated by a reeling housing market.

Weichert Relocation Resources Inc., a company that specializes in relocation and assignment management, has seen some early signs for optimism in 2010. For one thing, there has been a drop in the rate at which companies have had to add or increase their loss-on-sale assistance. A year ago, 40% of companies surveyed were having to ante up or improve their existing relocation packages, but fewer businesses find that necessary now.

The number of companies that had given their employees added incentives to sell their existing homes quickly have dropped, as have the number that increased coverage for temporary living assistance. At the same time, companies are weighing more closely which employees will be transferred and are instituting tiered benefit packages for those who are relocated. In a nutshell, 90% of the companies in the Weichert survey had changed their policies in response to the recessionary business environment.

The most frequent changes were made as a response to the real-estate market, and not about internal company affairs. These changes put more restrictions on employees who wanted to take advantage of relocation assistance, such as requiring that transferees work with a qualified real-estate broker and make list-price reductions when advised.

Ellie Sullivan, director of consulting at Weichert, says that one of the most effective changes made by companies comes in their improvement of the pre-decision process. Many companies had no pre-decision rubrics at all before the most recent recession. Now, 65% of the companies surveyed are offering pre-decision counseling. Potential transferees receive counseling on the new location and home sale issues. Giving an employee more information before a transfer is a "done deal" saves costs for a company by reducing the number of transfers that don't work out after the fact. Lina Paskevicius, consulting manager at Cartus Global Consulting, believes that putting more time into the pre-decision assessments is becoming "the new normal."

It can be hard for a company to persuade employees to move during a volatile economy, but new and updated approaches and policies can result in better all-round results.