I recently heard someone say “I’m not telling you it’s going to be easy, but I am telling you it’s going to be worth it”. I think of this quote when I hear about companies that just give their employees a lump sum check to relocate their family without additional support. Lump sum programs continue to be a trend, but so does needing critical talent to grow your company. Making the relocation a great experience for employee should also include thinking about their safety!
Here are 7 things you need to know when you provide your employee a lump sum check to relocate family.
Let’s start by answering the question, why do companies typically provide a lump sum relocation benefit when relocating an employee? The answer is…
1. Easy to administer for employee.
2. Easy to calculate budget / actual spend.
3. Less complex program for companies that do not have partnerships.
Yes, it’s as easy as 1, 2 3… This is because companies that provide a small number of relocations don’t feel they have the resources or bandwidth to manage all of the necessary relocation components. Therefore, companies often take the “cut the employee a check” approach to help pay for the relocation expenses. However, there are some compelling reasons and advantages below to pursue and develop a strong relocation partnership… starting with SAFETY!
4. SAFETY – Employees typically don’t know who is best to call when the relocation begins for real estate or household goods move. Doesn’t it make more sense to direct the relocation provider when transferring employee? Using this approach, you ALWAYS know who is in the employee’s home. It is SAFER for the employee when the company has completed background check and developed the partnership. I am sure Arlo (played by Richard Pryor) thought he was getting a deal until Hummingbird Movers showed up at his home on move day in movie “MOVING” (pictured above). This could happen to your employee without direction.
5. RELOCATION RESOURCES – Relocation partners are the experts and can make the process EASY for the employee during transition. Most importantly, relocation partners will “elevate the experience” for the company during the onboarding process helping employee with resources needed for the family moving. Lean on them to make this a great experience for your team.
6. ECONOMIC IMPACT – Relocation partners provide positive economic impact above the corporate discount. This can be advantageous when discussing policy, moving household goods, reporting, and tracking metrics for improvement. Corporate partnerships offer so much more value and actually become an extension of your HR team.
7. DIRECT BILL is considered non-taxable income for the employee when moving household goods, it is the preferred method of payment for employee, and allows the company to have a partner that will be accountable if a moving challenge presents itself during the move. All of the paperwork wil be audited for compliance along the way for invoicing accuracy.
As you can see, the advantages of developing a strong relocation partnership heavily outweigh the reasons not to invest in one when moving your employees, especially EXECUTIVES!
Call to action: If you provide a lump sum relocation benefit, reach out to someone you know that moves their employees, and ask for a partner referral to start discussing partnership strategies for your next relocation. Your employees will appreciate it more than you know!
This has been a “Relocation Minute” update on “7 things you need to know for Lump Sum moves” with Bruce Waller, For more information, call 972-389-5673, or email firstname.lastname@example.org or check out our my social media Facebook and twitter page.