Global mobility, the movement of employees from one country to another, can bring a host of complexities for international payroll professionals to manage. There are many reasons an organization may decide to send employees to different locations and many benefits that companies may have not initially considered.
What are employee views on relocating, and what should employers consider?
First, it’s important to look at the willingness of people to make a move and companies to be aware of who wants to relocate. It might surprise some that the desire to work internationally is as strong as ever despite the pandemic.
- 80% of workers would relocate for work post-pandemic, which may seem high but, while we learn to live with some restrictive measures and begin to emerge from lockdown measures, the desire to travel again isn’t a huge shock considering the restriction of movement that has been in place up until this point.
- 45% would prefer their employer handle all the logistics for them. Again, not surprising when the complexity of in-country requirements is considered.
- 25% of global mobility leaders have a real-time understanding of the mobile readiness of their complete workforce. Meaning the vast majority are not aware of those employees willing and able to relocate to support business needs.
Understanding the willingness of your workforce to move is vital, but how can it then be used to support strategic business initiatives?
How global mobility can support business expansion
In some situations, companies will use a mobile workforce to their advantage to support growth ambitions. As companies look to set up in new geographies or where companies may be onboarding employees because of M&A activity, sending key personnel to these locations for extended periods can be the difference between success and failure.
Global mobility, in this instance, can support closing any skills gaps and provide a means to solve any localized shortages in talent on a permanent or temporary basis. For others, it can help them to deploy key personnel and their experience into new locations quickly. Plus, moving employees also helps to support knowledge sharing and training as the company opens new offices or enterprises in a new country.
The impact on inclusivity
Diversity and inclusion (D&I) have become a huge area of focus for businesses. Along with equality across all areas being the right thing to do, companies are seeing how a more diverse workforce supports business success. Although inclusion is not limited to gender alone, the gender gap in the workforce is probably the area where businesses start when they begin their D&I journey. And, maybe surprising to some, global mobility is something to consider as you map equality plans -an area many women view as important when considering a move to a new employer. The statistics to support this approach offer valuable insights:
- 71% of female millennials want to work abroad during their career, but only 20% of the current internationally mobile population are women.
- 64% percent of women said opportunities to undertake international assignments were critical in attracting them to and keeping them with an employer.
- Only 22% of global mobility leaders said their organization’s mobility and diversity strategies were aligned.
- 65% of women said they would like opportunities to work overseas to be made more transparent by their employer.
This paints a clear picture that global mobility should be reviewed and offered where possible as part of a more comprehensive D&I strategy.
What global mobility means for payroll teams
Although there are excellent outcomes from an effective global mobility strategy, processing payroll for employees on assignments in other locations can put additional pressure on payroll teams. They must understand the legislation as it applies in the new location and ensure that all tax obligations are met for the employee and the organization.
Tips to ensure success with managing payroll for overseas employees:
- First, consider the potential categories of mobile employees. These can include permanent transfers, long term assignees, short term assignees, business travelers, and commuters.
- Your strategy should include numerous policies, procedures, and methodologies – there is no one size fits all. Each company needs to design a plan that works for its business and employees.
- You will need policies on various topics, which will include tax, social security, and payroll. The importance of a well-drafted policy cannot be overstated - it gives stakeholders a clear picture and drives efficiencies. It helps prevent delays for the business unit and protects against employee frustrations – it keeps HR happy!
- Remember, communication is key – HR, payroll, tax, finance, the business area, and the assignees all need to fully understand the implications of the assignment and what it means for both the individual and the company.
When looking at your global mobility strategy, ask yourself:
- How big is your global mobility need?
- Is a dedicated resource (s) needed?
- Where does global mobility sit in the organization?
- Is it a function in its own right?
- How does it link with payroll?
- Consider where payroll is managed – is it outsourced etc?
In considering the future of global mobility, the advantages are clear when it comes to supporting business expansion and in areas such as inclusivity where you might not have initially had that marked as part of your D&I plans. As we get back to increased business travel, it’s important that businesses look at the strategies they have in place and begin plans to implement improvements to benefit the organization and fulfill the want and willingness of employees, regardless of circumstance have expressed.
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