Moving For Work Part 2: Considerations For Employers with Lump Sum Relocation Packages
Acquiring and keeping top talent can be difficult in today's turbulent job market. Many employers try to stand out from their competitors in benefits and employee incentive programs. However, a less obvious way employers have found to attract top talent is to have a top-of-the-line employee relocation program. By ensuring a smooth transition for your employees into their new roles physically and geographically, you can maintain employee morale and the increased productivity that comes along with it.
A lump sum relocation program is a typical form of employee compensation to aid in their relocation. You may have heard of two lump sum relocation programs: Self-Service and Variable. Today, we will explore both types and discuss the pros and cons of each.
Variable Lump Sum Relocation Packages
Variable lump sum packages still enable some flexibility and ability to choose for your employee, but they also offer a level of guidance and support. Your variable lump sum package could come with access to preferred service providers and relocation consultants. However, it still determines the amount based on specific criteria like the location of the move, family size, and complexity.
Challenges:
Perceived Fairness: Lump sum packages that differ in amount can cause tension within the company and among employees. Employers must ensure that every plan is fair and accurate.
Complexity: Trying to figure out the best estimate of how much money each employee will need can take up a lot of time and resources from your HR department (If you have one!) Working with a full-service moving specialist like Armbruster Moving and Storage can make the process easier and alleviate that task from your team.
Advantages:
Cost Efficiency: The more accurately you allocate employee funds, the more it aligns with your overall business plan.
Guidance and Resources: Vetted service providers and reputable relocation consultants, whom employers refer, make the process smooth and easy. You can use a full-service moving company like Armbruster Moving and Storage and make it easy on yourself by hitting all critical details in one partnership.
Tailored Support: You can ensure your employees are satisfied with their lump sum package amount based on where they are relocating and their personal needs and expectations.
Self-Service Lump Sum Relocation Packages
This style of package is a lot more hands-off for employers: It ultimately involves offering your employees a fixed sum of money to relocate and allowing them to make all of the relocation decisions themselves, as well as coordinating all of those plans. From locating and choosing temporary housing to booking their moving specialist, the company is not involved in that process outside of funding.
Challenges:
High Stress: The employee is tasked with taking on a new role and accumulating to their new environment and coworkers. Having them manage a move with no resources other than a lump sum will add stress to them and their family.
Potential for Misallocation: Because this isn't something they do regularly and they are not receiving any guidance, employees may use funds for things they shouldn't and run out of money faster.
Lack of Guidance: This kind of move requires a lot of planning and strategic money allocation, which can be overwhelming for someone already facing a potentially long-distance move. When employees become overwhelmed, they could end up making sub-optimal decisions. The potential for the employee hiring a rogue mover or un-vetted service provider is high.
Advantages:
Cost Control: It's easier to control the cost of employee relocation programs when a fixed price is incorporated into your annual budget.
Simplicity: If you run a small business, your HR resources may already be stretched thin. This package allows you to agree on a fixed price and disperse funds, and that's it. Your company is not responsible for ushering the employee through the transition.
How to Choose the Right Lump Sum Package for Your Employees
You may be thinking that to provide a variable lump sum package to your relocating employees, you will need to exhaust your internal resources and use a lot of valuable time guiding your employees through their move. This can be true if you opt to handle all of the logistics yourself, but you also have the option of moving with a full-service company like Armbruster Moving and Storage. Our moving specialists can offer full-spectrum support for your employees, making sure they have all of the resources and services they need to make their transition into their new life and employment seamless and smooth.
Additional resources will be needed like mortgage support, corporate living, and home finding trips. Aligning yourself with the best move manager will have these resources available for you and your relocating employees.
When hiring a moving company who specializes in corporate relocation you will realize cost savings by guaranteeing annual business. Another huge benefit will be getting first priority in the busy moving months of May through September in addition to your discounted moving rates. You will want to inquire about referral partners for realty, mortgage, and destination services like home finding. Aligning yourself with the right moving company will make your job easier and allow your company cost savings.
Learn more about how we help companies with their employee relocation programs here.
