You would think managing long term assignments would be easier on both companies and create less interruption to mobile employees, as opposed to managing multiple short term assignments…but we are seeing a trend within our industry that for most companies this is not the case.
Companies are exploring creative ways to reduce the overall costs of traditional international assignment types, which can add up to 3-5 times the employee’s annual salary. From short term assignments to more traditional alternative international assignment types such as permanent transfers and localization, organizations seek to control costs around repatriation expenses, home country payroll and benefits, and high on-assignment allowances.
It’s not just about the cost: Family issues continues to be the top reason for reluctance to mobility and failed assignments. This obstacle is forcing companies to provide alternative approaches to traditional long-term assignments, which explains the rise in alternative approaches, including commuter programs and extended business travelers (EBTs).Jennifer Connell
In our 2018 Extended Business Traveler (EBT) survey, 97% of companies indicated that EBTs will remain the same or increase. But this trend can be problematic for organizations, as 93% of survey respondents indicated that they are concerned with non-compliance.
One of the biggest challenges to achieving compliance is that many organizations simply don’t have centralized visibility into who their EBT population is, nor do they track when, where, how long, and why they are travelling. These details are vital to ensure compliance.
While this shift to a combination of short term, alternative assignments, and extended business travelers can deliver cost savings, it’s important to understand that these programs can impose the same tax and immigration requirements as long-term assignments. A thorough review of benefits including household goods shipments, housing, and assistance extended to dependents will ensure that organizations have a solid grasp on the various compliance challenges associated with each move type.