With the current corporate consolidation climate of mergers, acquisitions and buy-outs, many dedicated employees may find themselves being asked to relocate.
An estimated 43 million Americans move annually and approximately 40 percent of those moves are job-related. Even though many employers offer comprehensive moving assistance, you should proactively negotiate the terms of your relocation package up-front with the following advice in-mind.
Know when to ask
The best time to negotiate relocation expenses is before accepting a new job, so you can avoid surprises. During the interview process, ask your prospective employer about the company’s relocation policy, and check to see if the human resources department can provide a written copy.
Larger companies may offer a more standardized relocation package than smaller companies, so determine the flexibility of your prospective employer. Also, the cost of living and compensation varies by city and your industry. So, do your homework to make sure the dollars are comparable in your new market.
Get a sense of other relocation policies. Ask associates in similar firms about their experiences with moving benefits and policies.
Options to cover moving costs
Companies usually handle direct moving expenses in three ways:
- A flat or lump-sum payment may be offered to cover expenses associated with relocating, including the moving company, hotels, meals, and mileage.
- All expenses paid up to a certain amount, provided you turn in all receipts.
- All expenses paid and coordinated through the company’s moving services provider.
What is commonly covered
The following expenses are typically covered in a corporate relocation:
- Temporary lodging costs – Make sure to negotiate these terms up front with as much flexibility as possible. Some circumstances are difficult to control. For instance, you don’t know how long it will take to buy and move into a new home. It’s also a good idea to try to negotiate the option to extend temporary living arrangements after 30, 60, or 90 days, if needed.
- Travel costs – If you relocate before your family does, find out if costs for traveling between your old and new residence are covered.
- Finding a home – About 46 percent of companies pay for one house-hunting trip to the new location and 49 percent cover two or more trips. Check to see if this also includes your spouse’s trip.
- Packing and moving costs – Many businesses work with moving companies that specialize in corporate relocations. Ask what all is covered, including the cost of hiring a van line, packing and transporting your belongings.
Other things to consider
Depending on your new position and the company’s size and flexibility, it is not uncommon to ask for additional perks such as:
- Assistance in selling your old home – This can vary greatly, depending on the new company’s policies, but here are some benefits found in many relocation packages:
- The company will assume responsibility for monthly payments, taxes and insurance until the old home is sold.
- Price guarantee – If you sell your house yourself, the company will pay the difference between the net selling price and a specified price.
- Alternative price guarantee – If you cannot sell your house within a pre-determined period of time, your new company will buy it at a specified price.
- Your company will pay commissions and other costs of sale.
- Extra time off with pay for traveling and house hunting in your new city.
- Shipment of your car at the company’s expense.
- Payment of closing costs on your new mortgage or buying a percentage point off of your interest rate.
- A one-time payment to cover incidentals such as utility hook-up deposits, appliance installation, auto registration and cleaning your old house to get it ready for the market.
- Job placement for a spouse – About half of U.S. companies offer assistance for a spouse who has to find a new job — usually through a referral to a recruiter or job placement agency.
Get it all in writing
Make sure you get all the agreements in writing and examine the fine print to ensure that everything is understood.