Across the globe Featured

8:00pm EDT August 26, 2009

With the job market getting tighter and tighter, you may need to expand your options and look outside your current city for a job. Or, if you’re searching for new talent, you might need to consider applicants from a number of different locations to find the perfect candidate.

According to a new study by, one third of employers have paid to relocate an employee in the past two years. And 59 percent of employees surveyed were willing to relocate for a new job. While relocating can be a hassle, it can also produce many benefits.

“Employees typically feel an investment has been made by their new employer if they are asked to relocate, and are more focused on their new job and performance,” says M.J. Helms, director of operations for The Ashton Group.

Smart Business spoke with Helms about key things to remember when relocating and how to structure an executive relocation package.

What problems can arise with relocation, and how can you mitigate those problems?

The current decline in home values has made relocation more difficult. Family challenges also will occur during the relocation, such as finding new schools and activities for children, and jobs for spouses. You also have to get acclimated to your new place of employment.

Talk about potential problems upfront prior to the move and map out ways to resolve them. If something happens, all parties will know the steps to the resolution.

What are some key things to consider when relocating?

  • Job security
  • Future promotions or growth within the organization
  • Other opportunities in the new market
  • Demographic data for your new area — schools, homes, local tax information and traffic issues

Get quotes from movers and calculate the difference in cost of living between your area and where your prospective employee is located. This will help during negotiations, because it shows the candidate you’re interested in getting the best deal for both parties.

You may also want to suggest renting as an option. This allows the employee more time to learn about the new area before making a commitment of home ownership, and get adjusted to the new job and city.

What should be included in an executive relocation package?

Packages can vary. Most companies will pay for household moving and packing expenses and temporary living expenses for up to six months until the home sells. Companies may also pay for weekly or bi-monthly trips back home over the weekends.

Find out what is most important to your new employee. Is it the fear of selling a home, or finding schools and churches in the new area? You can then tailor a package that suits his or her needs. No two relocations will ever be the same.

What other options do you have with relocation packages?

You can offer a signing bonus instead of paying for relocation expenses. Bonuses can vary from company to company. You may want the new employee to sign a contract that states he or she will work for you for a certain amount of time. All or part of the signing bonus would have to be paid back if that contract is breached.

The best time to offer that bonus also varies. You may give it to the new employee when he or she begins work, or only give part at the beginning and the rest later. Make sure before you offer a bonus that this is an employee whom you want at your company for a good amount of time. You have to protect yourself against employees who receive bonuses and then leave after a short period of time.

The bonus amount can range from 20 to 200 percent of the base salary, depending on the industry. Sizable bonuses are typically reserved for high profile positions, along with positions that are difficult to fill. Bonuses may help with recruiting individuals employed with other companies and convince them to change positions.

How can outside sources help in the relocation process?

Staffing firms can help identify candidates in other areas, arrange interviews, assist in salary and package negotiations, and help coordinate the relocation. Firms can also offer guarantees to the company if the relocated employee does not work out. Assistance can also be provided in finding work for the relocated employee’s spouse.

You may consider using a relocation company, which will hire an approved real estate agent to sell your new employee’s old home. The agent’s sales commission is paid by the relocation company. This may save your employee 5 to 6 percent on the home’s selling price, depending on the area. You may also consider paying for closing costs on the new home. If the home does not sell within 90 days, the relocation company may purchase the home, with the selling price based on three estimates.

While outsourcing relocation services will save you time and money, you need to be aware of the pros and cons. Research more than one relocation service in the area and get a cost analysis to help choose the best company.

M.J. Helms is the director of operations with The Ashton Group. Reach her at (706) 636-3343 or