Employers don’t like losing valuable, proficient, highly productive and higher-level employees. They also love hiring such employees. These employees help companies remain highly competitive, meaning employers find ways to retain or attract such employees. A job relocation package is a good example of a way in which they do this.
If you are looking for a new job or changing careers, here’s what you need to know about relocation packages.
Before we move on, please note that tax treatment depends on the specific circumstances of the individual and may be subject to change in the future.
What is a relocation package?
This is when a company covers the expenses involved in relocating you and your family to a new home closer to the company. The package includes the expenses and benefits the company is willing to cover if you agree to move.
Not to be confused with a relocation package is a relocation plan. Relocation plans outline the steps or tasks required to complete a successful move. It highlights duties assigned to different people or companies and the particulars for specific tasks.
In a nutshell, a relocation plan ensures all tasks are completed within a particular timeframe and within the set budget. This minimises downtime and productivity loss.
What makes a good relocation package?
A well-developed relocation package needs to be attractive to employees. It also uplifts a company’s reputation for attracting and hiring top-notch talent.
How much is a typical relocation package?
Since different employees have different living situations, it’s difficult to place an exact value on a typical relocation package. For example, one employee might be living in a rental, another may be a homeowner, a third might be living in another county, and a fourth might be living in another country.
Of course, these four employees will require packages that cover their unique situations. That said, a typical relocation package averages around £8,000.
How common are relocation packages in the UK?
Research conducted by staffing and employment services company Totaljobs indicates that 80% of employees would relocate if an employer offered them a relocation package.
Additionally, a simple google search on relocation package jobs in the UK reveals that many companies are offering relocation package jobs.
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This indicates that relocation packages are quite common in the UK.
What should be in a job relocation package?
Look for the following features:
Use of a reputable moving company
A reputable moving company provides beneficial services like packing your household goods and loading them on the moving lorry on your behalf. On arrival, the moving company offloads your belongings and unpacks them. Reputable moving companies also offer insurance coverage for your belongings to offer peace of mind.
Early lease termination
It is not uncommon for a landlord to charge a penalty for early lease termination. If this occurs, the company pays the penalty.
Reimbursement of money lost during the quick sale of an employee’s home
In some cases, especially where you’re a homeowner, the company may help you sell your home quickly, resulting in a loss. If reimbursement is part of the package, the company reimburses the money lost.
Assistance when looking for a new home
Looking for a new home can be stressful and expensive. The company caters to these costs and other needs you might have when house hunting. For example, if you have children, you don’t have to house hunt with them. The company pays for child care while you house-hunt.
While house hunting, you need a place to live. Your employer may provide temporary housing for about one month; it can be a hotel or furnished rental housing.
Tips on negotiating a job relocation package
In some cases, relocation packages may not entirely cater to your unique situation. That is why there is room to negotiate. You may need to evaluate yourself first to identify various aspects that might be affected by relocating.
Try not to seem demanding; instead, make your employer understand how your relocation may affect various aspects and what it may require.
Are there any tax or reporting obligations to relocation packages?
Yes. Employers should note the tax and reporting obligations to providing relocation benefits and expenses to employees. You may also find that you will be exempt from paying tax for various relocation costs below £8,000.
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