Wednesday, September 30, 2009

Relocation: Time for Negotiation

Many companies embrace and encourage the expat with the idea(s) that an employee gains multiple/new facets of the company, shares his/her ideas with counterparts, and returns ready to share key learnings.   For many multi-national companies, an executive cannot reach the next-level in their careers without an overseas assignment at a subsidiary.   Companies like IBM see it as a mandatory step for rank-and-file executive. 

Unfortunately, my company had no aspirations for cross-pollinating employees and their ideas.  Likewise, there is no defined management track whatsoever so any work overseas was for my own personal and professional desires.    To this day, the company has no defined 'expat package' for moving employees back and forth.   Therefore, I was told I must resign from the one (USA) company and sign new employment contracts with the (EMEA) subsidary.   If you've found out your company has no expat policies, that is a red flag!   Three key learnings surface this stage:

1) When a company has no defined relocation/expat policy, you have greater latitute in negotiation.
2) When a company has no defined relocation/expat policy, you do ALL the research by yourself. 
3) Few other expats exist to provide guidance. Lack of expat policy does not exactly encourage staff to risk their career, family, and financial wellbeing.

While there are several companies that publish the perfect expat package, here is what one should expect as the minimum before accepting an overseas assignment?  

Country of origin:
Guarantee of employment upon return (company did not offer this)
Executive mentor who can support your career/transition back stateside  (company did not offer this)
Cost relief for US Tax returns preparation (company did not offer this)
Cost of Realtor or cost relief associated with lease-buyout (company did not offer this)

Host country:
Cost relief for first year tax preparation fees
Packing and shipment of household items
Foreign language lessons @ min of 40 hrs or 2 week course and spouse @ min 20hrs or 1 week course
English-language school for children (company did not offer this)
Agent to translate/file work permits, driver license requests, bank account, residence permits
Thirty-days paid apartment rental while you find perminent residence. 

You might think Medical is your primary concern but Germany and most EU countries have good socialized health systems.  English-language schools are expected to be the most expensive item.   Expect to pay 15,000+ Euro per student/yr.   If you have children over 5yrs old, you better resolve this item now.   Putting them into the local school system can be beneficial, it could set the back a grade-level once you return to stateside.     When negotiating, also consider your employment status with the firm as either:

1) Still employeed by the US entity and simply 'on loan' to the overseas subsidiary?
2) Resigning from the US entity and considered a 'exempt' employee in the host company? 

There should be no interruption in your time of service/tenture between corporate entities.    

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