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Winter 2011/2012

ISSUE 48

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International HR Adviser The Leading Magazine For International HR Professionals Worldwide

Features include: Emergency Evacuations: Will The Arab Spring Become The Arab Winter? Hardship Allowances: Location Or ‘Hardship’ Allowances Cannot In Themselves Compensate For A Crisis Technology: The Latest Developments In Technology And Their Consequences For Modern-Day Employees International HR Strategy: Integrated Compensation Data Management Talent Management: Understanding The True Cost Of Losing Globally Mobile Talent Advisory Panel for this issue:


Autumn  International HR Adviser


CONTENTS

In This Issue Page 2

Emergency Evacuations: Will The Arab Spring Become The Arab Winter? Damian Taylor, Travel Security Services (a joint venture between International SOS & Control Risks)

Page 4

Hardship Allowances: Location Or ‘Hardship’ Allowances Cannot In Themselves Compensate For A Crisis Neil Ashman, ECA International

Page 7

Technology: An Occupational Hazard – The Latest Developments In Technology And Their Consequences For Modern-Day Employers Tim Grant, Track24

Page 10

International HR Strategy: Integrated Compensation Data Management Philip Crossman, Deloitte’s Global Payroll & Management Team

Page 15

Taxation: Getting The Best Value From Your Tax Consultant Andrew Bailey, BDO LLP

Page 18

Global Taxation Update Andrew Bailey, BDO LLP

Page 20

Immigration: The Pace Of Change Works Both Ways: Allowing The UK Migration System To Settle Down Caron Pope, Fragomen LLP

Page 22

Global Immigration Update Fragomen LLP

Page 27

Dual Careers: International Mobility: The Ongoing Dual-Career Challenge Siobhan Cummins, Independent Consultant

Page 29

Relocation: State Of The Industry 2012 Dominic Tidey, EURA

Page 31

Recruitment: The Recruitment Landscape For 2011 Caroline Frostick-Seear, Red Recruit Global

Page 32

Talent Management: Understanding The True Cost Of Losing Globally Mobile Talent Stuart Woollard, King’s College London

Page 34

Global Serviced Apartments Industry Report 2011-12 Bard Vos, The Apartment Service

Page 36

Survey: Strategic Moves – A New Direction For Global Mobility Deloitte LLP

Page 46

Diary Dates

Page 47

Directory

International HR Adviser, PO Box 921, Sutton, SM1 2WB, United Kingdom Publisher • Helen Elliott +44 (0) 20 8661 0186 • Email: helen@internationalhradviser.com Publishing Director • Damian Porter +44 (0) 1737 551506 www.internationalhradviser.com In Loving Memory of Assunta Mondello

Helen Elliott

While every effort has been made to ensure accuracy of information contained in this issue of “International HR Adviser”, the publishers and Directors of Inkspell Ltd cannot accept responsibility for errors or omissions. Neither the publishers of “International HR Adviser” nor any third parties who provide information for “Expatriate Adviser” magazine, shall have any responsibility for or be liable in respect of the content or the accuracy of the information so provided, or for any errors or omissions therein. “International HR Adviser” does not endorse any products, services or company listings featured in this issue.

Cover Design by Chris Duggan

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Emergency Evacuations

Will The Arab Spring Become The Arab Winter? Since December 2010, a revolutionary wave of demonstrations and protests has been taking place across the Middle East and North Africa (MENA): Revolutions have taken place in Tunisia and Egypt, culminating in regime change; there has been civil war in Libya and wide-ranging civil unrest and protests in Algeria, Bahrain, Iraq, Jordan, Morocco, Oman, Syria, Israel, Yemen, and even Saudi Arabia. The pace of change is unprecedented. The security, political and travel risk ratings for countries across the region have changed dramatically. For companies operating in the Middle East and North Africa, there has been immense pressure to not only respond to escalating crisis situations, but to safeguard staff and put plans in place to maintain business operations wherever practicable and possible. The situation remains fluid. The ‘Arab Spring’ captured the initial uprisings and sense of euphoria as repressive regimes were challenged, and some commentators in the media have talked of an ‘Arab Winter’, but as my colleague Julien BarnesDacey, Head of Control Risks’ MENA desk, said in a recent presentation: “The sense of a seasonal Arab Spring and Arab Winter that would rapidly stabilise is something of a misnomer. The long-term outlook is one of on-going change, turmoil and uncertainty..”

So what have we learned so far? Major crises and a constantly evolving situation in multiple locations mean that you have to be fully prepared for the unexpected and able to respond quickly! We have learned lessons and so have our clients… Despite having generic crisis management plans and procedures, many large organisations had very limited planning in place for supporting staff in overseas locations. There was little individual training for staff, crisis plans were unrehearsed, crisis teams were not sufficiently trained, and the interface with response agencies was unclear. Organisations need to have one single point of contact and tasking when engaging assistance organisations – conflicting direction and undefined reporting chains confuse and allow multiple tasks to be International HR Adviser  Winter 

assigned. There is no doubt that planning must be established well before a crisis occurs and it must be included in every business unit as part of the project scope. In today’s uncertain world there is a need to develop the capacity to support global crises simultaneously and plan for concurrent events in geographically dispersed locations. In response to a recent poll question “How well prepared do you feel your organisation is, if events in the MENA region continue to deteriorate?”, over 40 per cent felt that their crisis plans were “well prepared”, but more than half of the participants said “they were somewhat prepared”, and 7 percent “did not feel at all prepared”. During the crises that took place in 2011 across a wide range of geographies and situations ranging from regime change in Egypt to the Tsunami in Japan, our clients identified ‘communication’ as the topmost priority and the biggest issue they faced. You need to know where your employees are and how to contact them and a Traveller Tracking system allows companies to monitor travel plans, map the location of employees and contact them to provide advice. However, plans should also allow for anticipated technology outage in affected areas. Mobile phone systems and the Internet are vulnerable. Media reports are an initial source of news of breaking events, but companies also need to establish methods to verify and analyse the real impacts for their organisation. In this context there is a requirement to access trusted sources of accurate information in order to make informed decisions based on considered analysis. Communication channels will not be easy and are invariably inconsistent, so there is a need to develop multiple options. Once you have located employees, how do you respond given limitations of transport on the ground, coupled with the fact of how you actually get them to the airport if evacuation is required? The psychological impact on employees and their ability to react will be variable and must be considered. This needs to be assessed pre-deployment. Plans should be developed for both evacuation and stand-fast solutions. Often stand-fast in an established safe haven can be the best response to a crisis situation. They

should also cater for added complications such as pets, local opportunistic practices, and cash demands. In any crisis situation, banks are likely to be closed and ATM machines empty at a time when many suppliers will deal only in cash. In November, during the recent demonstrations in Cairo, our joint venture deployed teams to both Syria and Egypt to assist clients to prepare for potential evacuation. Our teams were able to provide advice to organisations by assessing and monitoring the situation on the ground and put procedures in place to assist employees to leave the country quickly. Fortunately, the situation improved and most employees chose to stand fast. The implications for companies with personnel in the Middle East and North Africa are profound. There is a fundamental paradigm shift, which will play out over some considerable time and there will no doubt be regular flashpoints across the region. The situation is fluid and unpredictable, so what should companies be doing? • Regularly monitoring in-country risk to personnel and business operations • Establishing robust location specific crisis management and evacuation plans and testing them on a regular basis • Providing security awareness training for staff operating in or travelling even to low - medium risk countries • Putting policies and processes in place to identify travelling populations as well as international and local staff incountry • Testing the communication channels and ensuring there is an identified single point of contact • Establishing exact locations and addresses for all in-country staff, together with ensuring all their paperwork, visas etc. are in order to ensure problem free exit in the event of an evacuation • At a time of crisis, ensure there is regular contact, reception and onward travel considerations are made to mitigate any psychological impact on employees. As events continue to unfold across the region, continued instability can be expected, with Yemen and Syria high on the list. Notwithstanding the potential


Emergency Evacuations

for increased risk in some instances, businesses must continue to operate within the region; effective Travel Risk Management will be key in effectively managing the risk that corporate travellers and expatriates will face. The importance of business continuity and crisis management plans even in moderate risk environments cannot be stressed too highly. These plans need to be realistic and relative to the prevailing threat, and it is recommended that you have access to trusted sources of information to allow informed decisions to be made.

Responding to the Egypt Crisis During January and February this year thousands of anti-government protesters took to the streets across Egypt to demand political change and the resignation of the then President. No crisis is without its challenges and the one in Egypt was no exception. With communication channels blocked for days, flight disruptions and cancellations, significant overland travel restrictions and imposed curfews, the safe evacuation of clients was not without its difficulties.

Timeline of support 23 January: Regular contact with members was made. Travel Advisories advise members to expect tight security. Our team of experts is already active in the region, with security specialists supporting clients in Tunisia.

25 January: Security situation becomes tense. As some protests degenerate into violence, our global security team send email alerts to members providing analysis and advice as security is tightened further in advance of the anti-government 'Day of Anger' on 28 January. 28 January: More than 900 members tracked. Using our TravelTracker system, we confirm that there are more than 900 members who are either in Egypt or scheduled to travel to the country. A Special Advisory is issued to members as President Mubarak declares a nationwide curfew and deploys the army. With further clashes between protesters and police focused on Cairo’s Tahrir Square, there are growing reports of looting and lawlessness. By nightfall, embassies in Cairo are shut, leaving many foreigners unsure of what to do. 29 January: Our crisis management team in London is activated and an Incident Management Team arrives in Cairo. As the situation deteriorates, the first ‘Stand By’ evacuation notification for members is issued. Mass evacuation support group is deployed to supplement the London Crisis Team. The first member of the Incident Management Team arrives in Cairo and an initial operational capability is established through one of our existing providers in central Cairo. Operations teams in our alarm centres in Philadelphia, Paris, Dubai, London and Frankfurt work together to coordinate client requests for assistance. Disruption of communications networks makes coordination difficult: Internet, mobile and SMS are disabled on and off for four days. Despite the curfew, the Incident Management team secures transport through an existing provider in Cairo to a central point from where members can be escorted to the airport. 30 January: Air evacuations start. Protests and clashes with the police continue in Cairo and other cities, despite the overnight curfew. A client liaison group is set up in the London alarm centre. The incident management team secures an evacuee assembly area at a local hotel from which point members are escorted to the

airport for departure. The first two evacuations totalling 287 passengers are flown to Frankfurt and Paris, and a further 39 passengers to Dubai. Throughout the crisis, problems arise with individual travellers’ visas and travel documents, which are resolved on a caseby-case basis. At all destination airports, we have reception teams including medical staff, to receive evacuees and provide assistance with accommodation and onward journeys where needed. 2 February: Escalation of violence in Cairo. Brutal clashes break out around Tahrir Square where running battles continue the unrest mirrored in Alexandria. Our consultants on-the-ground assist clients by collecting their employees from locations around Cairo and across Egypt and escorting them safely to the evacuee assembly area. Despite communications still being down, we continue to coordinate evacuations. That night a flight takes 97 evacuees to Paris. 3 February: Flight from Alexandria to Dubai. Another flight takes around 114 passengers, two dogs and a cat from Cairo to Paris. Nurses from London and Dubai arrive with medical equipment to provide additional on-the-ground assistance. A key part of their role is providing emotional support to frightened and distressed members and their families and we held a webinar attended by 422 clients to update them on the situation. 5 February: Medical support is provided. The medical team supports members with injuries, ensuring that they are admitted safely to a hospital in London. One client suffers a stroke and is evacuated by air ambulance. In total, more than 1,250 members were evacuated with 420 members evacuated via commercial aircraft. International SOS and Control Risks fielded a team of 20 security and medical specialists to provide on the ground assistance in Egypt. Damian Taylor Regional Security Director EMEA & CIS, Travel Security Services, a joint venture between International SOS and Control Risks. Damian is responsible for the delivery of all travel security services across the region, working closely with Control Risks’ and International SOS’ operational teams. For more information, please contact: www.internationalsos.com and www. control-risks.com Winter  International HR Adviser

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hardship allowances

Location Or ‘Hardship’ Allowances Cannot In Themselves Compensate For A Crisis For many international assignees, and those who manage them, 2011 was a challenging year. This is especially true for those based in North Africa and the Middle East. The main spark was a popular uprising in Tunisia in January which saw the ousting of the long-time President. The perceived success of this movement was widely seen as the trigger for similar movements across the region – the outcomes of which have varied wildly. In Libya we saw NATO's intervention and the eventual removal of Muammar Gaddafi. In contrast, the uprising in Bahrain was swiftly put down by the authorities. At the time of writing, Syria is gripped by instability as the Assad regime clings to power in the face of international pressure. In each case, expatriates have been advised to leave for their own safety. This has presented a huge challenge to international HR managers. And what about situations where it is not clear cut if expats should leave? The decision can be even more difficult in locations affected by natural disasters. Japan earlier this year was a case in point – the earthquake and resulting tsunami had a clear impact on the North East coast of Japan. Tokyo was relatively unscathed – but the resulting nuclear crisis led to the evacuation of many expatriates, or at least their families, from the capital. In any crisis situation it is important to have a plan in place for your international assignees. Governmental organisations such as the US State Department and the UK’s Foreign and Commonwealth Office, constantly review ongoing situations and update their travel advice accordingly. The key thing is to have a clear and comprehensive crisis plan in place. This should be as clear and pre-specified as possible so that everyone knows when it will take effect and what will happen when it does. Plans must be in place at corporate and local level, and even at each specific site – every location is different and accordingly will have different escape routes for example. Good International HR Adviser  Winter 

communication is absolutely vital at all levels - everyone involved must be clear what their role is and the exact procedures in place to deal with international assignees in crisis locations. In early 2011, following the unusually high concentration of natural and human flashpoints, we carried out a spot survey entitled “Managing allowances in times of crisis” to determine just how companies do deal with their assignees in crisis locations, in practical terms and with respect to managing allowances. The response was comprehensive, with over 145 companies from a wide variety of backgrounds taking part, and the responses themselves offered a very interesting insight. Just over half of the respondents had a formal crisis policy in place before any crisis hit. Of those without formal procedures in place 60% were now considering implementing one. For those organisations with a policy in place, by far the most common emergency measures implemented were repatriation or evacuation to a nearby country. This usually applies to both the assignee and their families. In just under half of cases, extra security and relocation to a nearby company office were other measures taken. We also asked respondents about the actions they took in specific locations. 100 90 80 70 60 50 40 30 20 10 0

Tokyo was an interesting one as out of 60 companies who had international assignees based there, nearly half evacuated the assignee and their family. This shows that there is not necessarily a universally accepted course of action. This is perhaps understandable given that the severity of the nuclear crisis that followed the earthquake depended on which news source you happened to be watching or reading at the time. The Location Ratings team at ECA also monitors situations all year round so that events can be taken into account when hardship scores and locations allowances are updated. Particular attention is given to how expatriates are affected by events. We have been asked many times this year if we would recommend immediate increases in location allowances in crisis locations. Is reviewing the location allowance the correct course of action when disaster strikes? ECA’s position is that this is not the most appropriate thing to do, a view which is supported by respondents – only 21% of respondents said they would do so. There are a number of good reasons why an immediate increase of a hardship allowance is not a suitable action: • Reviewing locations once a year as part of salary reviews (as 50% of respondents in the survey do) ensures

% companies with crisis policy Ev Re ac pa ua tri tio Re at n loc io to n at n ion ea r by to co ne un arb try yc om pa ny offi ce Ex tra se cu rit y Inc re as Im ed pr R& ov R ed m ed ica lc ov er

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Assignee Family


hardship allowances a consistent and defensible approach and also reduces any confusion which might arise from changing allowances mid-term • In fluid situations a revised allowance could be out of date within hours. At the height of tensions the situations in Egypt and Libya, for example, fluctuated almost hourly - so if an allowance were changed immediately it might very soon be obsolete as the situation progresses, especially with the lag caused by administering that new allowance • Money is not necessarily the answer. A higher location allowance may not help an expatriate stuck in a crisis situation in any practical way. It’s more appropriate to have a good crisis policy in place and implement security measures or evacuation procedures • There is a difficulty of withdrawing an additional allowance from expatriates and also deciding when to take it away, especially if the expats themselves consider the situation to be on-going. The last point is an interesting one – what is the trigger for another location allowance review? Or if assignees have been evacuated how does one decide when to send them back? In terms of repatriating assignees and their families, 80% of respondents go with the recommendation from government sources, while 68% would seek advice from security agencies – these are both sensible courses of action. Although we don’t recommend ad-hoc changes to hardship allowances, ECA does take into account all events and changes when we update our location allowance recommendations in November. We conduct a survey of expatriates once a year, whose input is supplemented by our own external research to establish an accurate and up-to-date view of hardship issues affecting international assignees. We do this for 434 locations, and in many cases little changes year-onyear. However, in locations where major upheaval has taken place the scores, and therefore the allowances, can potentially change significantly – especially in locations which had previously been relatively stable. So which aspects of the score generally change? Of course, in a location which has seen the type of upheaval and unrest experienced in the Middle East this year, we would expect the security and sociopolitical aspects of the score to increase.

Likewise, in locations hit by an earthquake or flooding we would expect a rise in the natural phenomena score. However, these events can impact, directly or indirectly, on many other aspects of life. Here are just a few examples from ECA’s own location allowance scoring system: • Health – facilities can be shut down at short notice or be overwhelmed with victims of disaster. Furthermore, water supplies can be badly affected by natural disasters, increasing the risks of water or air-borne diseases • Goods and Services – whether a crisis is natural or man-made, supplies of essential goods can be severely impaired • External Isolation – international flights can be disrupted, especially in times of political unrest – or in Libya’s case when no-fly zones are imposed. Airports can be shut down at short notice hampering evacuation routes • News and Media – media sources can be heavily censored by a government clinging to power, making it difficult for international assignees to get a full picture of events going on around them. Communications networks, such as the internet and mobile phones, can also be affected • Housing and Utilities – these can be badly damaged by earthquake or flooding. ECA conducts thorough research of all these factors and more to establish exactly how events impact on international assignees and the allowances are amended accordingly. Hardship allowances should be regarded as a compensator for assignees having to adapt to new circumstances. Conditions in crisis hit places will be reflected in the allowance. But, as we have seen, allowances are no substitute for having a comprehensive crisis policy in place for when disaster strikes. Neil Ashman, Location Ratings Manager at ECA International, reports on current and best practice for reviewing allowances in difficult times. Telephone: +44 (0) 207 351 5000 E: neil.ashman@eca-international.com Website: www.eca-international.com

Free Seminars at The 2012 Corporate Relocation Conference & Exhibition Monday 6th February 2012 Hotel Russell, Russell Square, Bloomsbury, London Chaired by Martin Humphrys, Humphrys’ Education Winner of Relocation Personality of the Year 2009

10.30am - Third Culture And Cross-Cultural Kids – Who They Are And How We Can Help! 11.30am - Relocating Successfully 12.30pm - Tax Planning Essentials For Expatriates In The UK 1.30pm - “All You Wanted To Know About Corporate Immigration But Were Afraid To Ask?” 2.30pm - Strategic Partner: The Next Move For Global Mobility 3.30pm - Setting Competitive Expatriate Management Policies: Current Trends And Best Practices Places at these seminars are free, but visitors must pre-register as there is limited availability. To register your free place, please email helen@internationalhradviser.com We look forward to seeing you there!

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You are cordially invited to

The 2012 Corporate Relocation Conference Exhibition on

Monday 6th February 2012 at

Hotel Russell, 1-8 Russell Square, Bloomsbury, London, WC1B 5BE This event is FREE TO ATTEND

Come along and meet our 42 exhibitors who have products and services that support Expatriates, International HR professionals and those advising the expatriate community There

are also free seminars running throughout the day and the seminar programme will be announced very soon. You will need to pre-register for the seminars as places are limited so please email helen@theamericanhourcom

If you would like complimentary invitations fir your friends, club members or colleagues, please email helen@theamericanhouncorn with the quantity and where you would like them sent to. For fierther information on this event please call Helen Elliott on 020 8661 0186. We look forward to seeing you there.


Technology

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An Occupational Hazard - The Latest Developments In Technology And Their Consequences For Modern-Day Employers Companies are increasingly finding themselves involved in situations where they need to account for their employees. This is usually when they are caught up in incidents in far-reaching places or sometimes, close to home, which result in staff being at risk or at least out of contact. As the need to locate, communicate with, and account for staff becomes ever more important, a range of new technologies is being developed to improve the ability of companies to rapidly locate their employees in emergency situations, and focus attention on those who really need it. Three separate research studies published in the last month have highlighted an increasing trend towards business travel to often dangerous locations. In one study, 95% of large companies surveyed claimed that they had sent their employees on business trips to high risk locations in the preceding year. This finding can largely be attributed to increasing trade in emerging markets (evidenced by a surge in corporate travel to the world’s new economic power houses), where risks include anything from crime and civil unrest to natural disaster. When employee safety is threatened as a result of an unexpected political or social crisis, or a natural disaster, it is necessary for companies to know the whereabouts of every staff member and to have a means of communicating with them. With many employees working in remote and potentially unsupported locations each day, organisations could be annually exposed to hundreds of thousands of ‘risk opportunities’ in which staff safety could be compromised. These hazards have become more apparent in the wake of recent events such as the 9/11 terrorist attacks in New York, the July 7 London bombings, the Arab Spring which began in December 2010, the 2011 Mumbai terror attacks, the tsunami disaster in Japan earlier last year, and Hurricane Irene last summer. During these incidents, many companies had difficulties establishing whether or not their workforce was safe. For

most, there was no clear process in place to locate employees and monitor their status, even when those employees were travelling for business. One multinational corporation took days to confirm that an employee was not in the vicinity of the tsunami disaster in Japan. Despite this individual having a mobile phone, it was impossible for his employer to communicate with him. The difficulties facing this company were exacerbated by GSM network failures and loss of internet connectivity. Organisations have a duty of care to ensure the health and safety of their employees. This duty exists both on and off-site, where staff can be at their most vulnerable, isolated from colleagues and without support in the event of an incident. In these circumstances, the means of communication becomes crucial. More companies are now turning to technology to resolve these communication issues. Employee location management systems, as opposed to travel management systems, will become best practice. These harness the power of the internet, as well as other communication mechanisms such as mobile phones, GSM and satellite tracking systems, and smart phones with GPS capability. Implementing a formal system for managing employee locations also enables the company to establish processes which place responsibility for updating location and security status on the employee. These new ways of working clearly mark a shift from expensive and unreliable voice-based communication to costeffective and dependable alternatives. Moreover, these systems significantly reduce other costs for the company for example, insurance premiums have decreased as a direct consequence of their implementation. For this technology to be implemented by organisations, it needs to be simple and easy to use. The days of gathering employee information from disparate sources such as the HR department or spreadsheets, and total reliance on ticketing systems to establish if someone is in

a particular country, should soon be over. New technology can replace these outdated systems, making processes seamless and simple. Employee location management systems will allow companies, large and small, to establish a robust and simple method for accounting for their people globally and locally. If there is an incident, then company directors will enjoy peace of mind, knowing that they have a tangible process in place to meet their duty of care obligations.

Case Study: A large multinational operating in Bahrain had placed the responsibility for managing employee location with security teams that were linked in to traditional travel management systems, incorporating flight ticketing information. When protesters in Manama sparked the Bahraini uprising in February, company management thought that up to 100 of their staff may have been in Bahrain at that time. Employee management processes, which relied on email and GSM phones, resulted in long lead times and it ultimately took three days to establish that only 10 personnel were in the country. While the company did have access to satellite phones, in a crisis situation, these networks are quickly overloaded with voice calls and rendered all but useless. Additionally, security teams were hampered by inaccurate data on employees, meaning they had to source correct data from areas such as the HR department, in records not specifically maintained for risk management. In other words, the company had access to all the data, but the process was so disjointed that it was ineffective in a crisis. When you consider that establishing whereabouts is only the first stage in a crisis response, three days becomes an unacceptable timeframe. An employee location management system could have quickly avoided this situation, by making it the employees’ responsibility to keep their itineraries up to date. Not only would the employer have instantly been able to identify which staff Winter  International HR Adviser

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Technology members were in Bahrain, but employees could have alerted them to their status at the click of a button - on a website, by SMS, by enabling Blackberry tracking, by switching on another GSM or satellite tracking device. The system could also have been set up to allow them to send text messages by satellite which are not only cheap but highly reliable - even in such crisis situations, satellite data is less prone than voice to issues caused by high volume traffic. Perhaps most importantly, the 10 people in Bahrain would have felt secure in the knowledge that there was an

effective process to account for them. Whilst the multi-national thought it

had effective processes, this incident highlighted intrinsic deficiencies.

Tim Grant is CEO of Track24. The web-based Track24 Employee Location Management System (ELMS) is the latest in a range of personnel tracking and crisis management solutions from the security tracking and risk management specialist, Track24. ELMS is priced on a per-userper-month basis and is designed to run as a standalone system or as part of a bigger solution, for companies concerned with the safety and wellbeing of their employees. For more information on Track24 ELMS please call, +44 (0)207 434 7305 or visit www.track24.co.uk

International HR Adviser magazine would like to pass on our congratulations to all the 2011 EMMAs Winners, Runner-ups and Highly Commended Corporate Only Awards: Global Mobility Team of the Year (Under 250 assignees) - Sponsored by Grant Thornton Winner: Norton Rose LLP Runner-up: Smith & Nephew Highly Commended: Serco Ltd Global Mobility Team of the Year (250 – 1000 assignees) - Sponsored by Fragomen Winner: Arup Runner-up: AstraZeneca Pharmaceuticals Highly Commended: Diageo Global Mobility Team of the Year (over 1000 assignees) - Sponsored by Natwest Global Employee Banking Winner: Deutsche Bank AG Runner-up: HSBC Bank Plc Highly Commended: Unilever Best Practice in Challenging Locations - Sponsored by International SOS Winner: World Bank Family Network Runner-up: BP Highly Commended: Chevron Ltd Most Effective Reward Strategy - Sponsored by Sterling Relocation Winner: Arup Runner-up: Kraft Foods Highly Commended: Norton Rose Most Effective Relocation Management Strategy - Sponsored by Interdean Winner: Morgan Stanley Runner-up: EADS International Mobility Center Highly Commended: Diageo Joint Award: Best Vendor Partnership Winner: Oakwood Worldwide – BP Runner-up: Cartus – SAP Highly Commended: Interdean – Volvo Highly Commended: KPMG LLP – BT Service Provider Awards: Relocation Management Company of the Year Winner: Interdean Runner-up: HCR Runner-up: International Personnel Management Highly Commended: Cartus Highly Commended: Weichert Relocation Resources Inc Destination Services Provider of The Year Winner: The County Homesearch Company Runner-up: ICUnet.AG Highly Commended: Executive Relocation Plus Ltd Highly Commended: The Relocation Bureau Ltd (Ireland) Best Tax/Legal Services Provider of The Year Winner: Deloitte Runner-up: BDO LLP Highly Commended: Fragomen Highly Commended: Global Tax Network

International HR Adviser  Winter 

Corporate Housing Provider of the Year - Sponsored by SIRVA Winner: Go Native Runner-up: Oakwood Worldwide Highly Commended: BridgeStreet International Moving Company of the Year - Sponsored by Mobility People International Recruitment Winner: Robinsons Relocation Ltd Runner-up: Crown Relocations Runner-up: Sterling Relocation Runner-up: UniGroup Worldwide UTS International Benefits Provider of the Year Winner: AXA PPP International Runner-up: NET EXPAT Highly Commended: Aetna International Thought Leadership – Best Survey or Research Study of the Year Winner: Brookfield Global Relocation Services Runner-up: Interdean Highly Commended: HSBC Bank International Ltd Highly Commended: SIRVA Open to all: Best Family Support Programme Winner: US Department of State – Global Employment Initiative Runner-up: NET EXPAT Highly Commended: World Bank Family Network Most Innovative Use of Technology in Global Mobility (Programme Management) Winner: Deloitte LLP Runner-up: Polaris Highly Commended: Equus Software LLC Highly Commended: KPMG LLP Most Innovative Use of Technology in Global Mobility (Knowledge) - Sponsored by Ernst & Young Winner: HSBC Bank International Ltd Runner-up: Move One Inc Highly Commended: Aperian Global Highly Commended: International SOS Ltd Global Mobility’s Rising Star of the Year - Sponsored by HSBC Bank International Winner: Julian Grose-Hodge (Robinsons Relocation Ltd) Runner-up: Julianne Dugdell (Arup) Highly Commended: Andy Elson (Interdean) Global Mobility Professional of the Year - Sponsored by Equus Software Winner: Tracy Figliola (HSBC Bank Plc) Runner-up: Curt Clements (Move One Inc) Highly Commended: Juliet Carp (Speechly Bircham LLP) Outstanding Contribution to Global Mobility - Sponsored by Robinsons Relocation Peter Lambert


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International HR Strategy

Integrated Compensation Data Management Employees who move across international borders, whether on a permanent basis, for long-or short-term assignments or just for frequent business travel, pose a particular set of compensation considerations and challenges for their employers. In fact, between the extremely complex and varied rules governing these “mobile employees” and significant increases in scrutiny from tax authorities around the world, compliance and reporting obligations surrounding compensation are some of the most difficult areas for organisations to “get right.” Failing to do so, however, can be costly.

Integrated compensation data management Collecting comprehensive compensation data from various global sources and determining it is treated properly from a reporting and remittance perspective can be extremely challenging. For one thing, it requires the ability to capture all elements of compensation related to international assignees. In addition to home or host payroll, compensation may include a variety of “off-payroll” payments; for example, payments on behalf of an assignee such as those made to vendors associated with the international move, tax payments, and/or various compensatory expense reimbursements. At the same time, compensation paid to or on behalf of globally mobile employees typically involves multijurisdictional reporting requirements and is subject to varying taxation rules. What may be taxable in one country may not need to be reported in another, or it may need to be reported in a specific way depending on the situation. Accordingly, companies need to understand all of the home and host requirements associated with each cross-border assignee. This requires strong multi-functional cooperation within the organisation. While many companies begin to think about this subject retroactively at the end of the year before the annual payrolls close, more and more companies are focusing on more proactive, effective compensation data management strategies - implementing clear, well-defined processes. Defining compensation International HR Adviser  Winter 

payment arrangements, data tracking processes, and reporting requirements up-front will almost certainly lead to fewer problems at the end of the year, including time-consuming efforts to backtrack and capture necessary data. Moreover, accurate year-end compensation reporting is no longer sufficient in many cases. Along with the UK (where HMRC can apply in-year payroll penalties), many other countries require accurate wage reporting and payroll tax remittance on a monthly basis, even if the employee is not on that country’s payroll. Some countries, such as China, also have monthly income tax filing requirements that require inclusion of all income sourced within that country. Think about effective global compensation data management in terms of annual activities to be addressed on a monthly or quarterly basis. These activities will need to be considered during the year and timed in-line with the tax or fiscal year in each country: • Quarter 1 - Debrief year-end activities by collecting year-end pay statements, assess any gaps or unexpected variance and remediate; begin consolidating data by country for provision to calendar year tax return preparers; meet with tax return preparers to validate compensation reporting requirements, agree on dates, and address any gaps or anticipated issues; and address any monthly filing countries needs • Quarter 2 - Assess fiscal year filing countries and determine reporting needs, validate current-year list of mobile employees with stakeholder groups, review first-quarter data and begin to identify gaps or issues, and address any monthly filing countries needs • Quarter 3 - Review second-quarter data and address gaps or issues, start planning for year-end activities by assembling stakeholder groups to confirm needs, dates, and anticipated concerns; meet with tax return preparers to confirm understanding of multijurisdictional taxability; and address any monthly filing countries needs • Quarter 4 - Review third-quarter data and address any gaps or issues,

communicate with stakeholder groups to raise awareness to payroll cutoff dates, finalise any calendar year-end additional reporting needs, and address any monthly filing countries needs.

How can such a small percentage of the workforce cause such complexity? Achieving compliance with respect to global mobility is very difficult. With the ability to work from anywhere via laptops and PDAs, simply keeping track of where employees travel, live, and work is becoming increasingly difficult. For some organisations, compensation data management for mobile employees is characterised by: • Inefficient, decentralised data gathering, tracking and sharing processes, with data disparities and versioning issues and no consolidated reviews • Labor-intensive processes. Even with some level of automation, organisations still must be prepared to understand the data and decide how to act on it • Potential omissions and/or duplications of data. The potential exists for organisations to miss categories of data for the population of assignees • Lack of clear accountability and responsibility for specific process steps. • Limited management reporting capabilities and no single place for executives to look at relevant data • Lack of centralised understanding of global requirements. Some global companies may place undue rely on vendors to complement their internal knowledge • Data privacy and security risks. While many organisations have robust processes in place to protect data, there is always the continuing risk for any organisation of inadvertent data privacy violations. In short, it is an environment in which “you don’t know what you don’t know” - and that means greater tax compliance risk.

Risk overview What happens if you do not get it right? Companies with mobile employees face: • Financial control risks. Although many companies carve out expatriate payroll for the reasons described above, it is important to avoid treating it as an


International HR Strategy exception to an integrated, automated financial reporting solution • Increased risk of identification of non-compliance and audit due to increased scrutiny • Potential tax regulatory penalties in both home and host locations, and possible prohibition periods for both assignees and management with responsibility for underreported withholding • Assignee dissatisfaction with the programme due to errors in reporting compensation either on year-end payroll reports or to tax return preparers • Reputational risk and/or adverse publicity resulting from underreporting compensation or from potential Personal Identifiable Information (PII) disclosure • Excessive costs for researching questions and for rework associated with incomplete data.

defines certain processes for tracking employees worldwide. The first steps for moving toward a global approach are to identify your organisational priorities; to establish guiding principles for managing your mobile employees; and to define the core requirements for HR administration, compensation, and international assignments. With those steps as a foundation, you then can: • Assess global requirements. What does your business need from HR? What are your integrated compensation data management requirements? How will you deliver global processes? What do you need in order to support globally

mobile employees? • Design the global process and data standards related to HR administration (personal data management and employment transactions), compensation (merit, incentive, allowances, and bonus), and international assignments. It is also important to account for payroll integration, identify data needs, and determine the extent to which you can make data consistent • Identify and address in-country needs. How can you extend the global processes and data to account for unique in-country requirements? What exceptions are

Moving from a decentralised approach to an integrated, global solution Organisations can increase consistency and compliance by addressing four areas of their global Human Resources (HR) model: • Consistent global HR policies and processes for HR administration and compensation, international assignment management, and payroll administration. These should provide the ability to track which employees are on some type of assignment, their home and host countries, and responsibilities for administering those employees and managing their assignment data • An HR service delivery model that considers integration of compensation data management and addresses some of the complexities and risks involved. This exercise includes documenting how processes are delivered to the organisation and who has responsibility for managing mobile employees • A global human capital management (HCM) platform that encompasses the technology used to track employees • A global payroll administration approach and platform.

Policies and processes Many organisations have tried to tackle HR policies and processes but mostly on a country-by-country basis. This approach generally has the potential to result in global consistency and may create process and administrative complexity for managing mobile employees. A global approach, on the other hand, sets minimum expectations for all countries and Winter  International HR Adviser

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International HR Strategy driven by legal, regulatory, or contractual requirements?

HR service delivery model With policies and processes defined, you can begin looking at how your HR service delivery model can support and reinforce them. Four areas of the service delivery model, in particular, may add value to integrated compensation data management:

HCM and payroll platforms Many organisations leverage a third party for process or technology solutions that track detailed global assignment data, and many vendors and outsourcers continue to evolve their capabilities for doing so. In fact, the HCM marketplace has matured substantially over the past five years, and leading HCM vendors now provide global capabilities that can drive process and data consistency. HCM vendors also continue to advance their payroll capabilities. In addition, many leading payroll vendors are now focusing on developing a global platform that provides consistent payroll delivery and reporting. As noted earlier, one of the specific risks surrounding mobile employees is data

International HR Adviser  Winter 

privacy. Any type of global solution must account for data privacy and protection to make sure that you are addressing the regulations or directives to which your organisation is subject to. One potential scenario for bringing all four of these areas together is to organise processes and solutions on a regional basis. In the example illustrated on the previous page, there is one global HCM system that allows all processes and tracks all data associated with employees. This system is integrated with regional shared services and payroll solutions that track, manage, and comply with detailed pay-related data and taxing authorities. If it makes sense for your organisation, you may consider adding a global mobility administrative system that enhances compliance and data quality, and facilitates tracking on a global basis.

Other considerations for improvement The visual (below) illustrates a centralised approach that includes one global depository for compensation data. This approach addresses many of the issues and risks outlined earlier by reducing the number of

“touch points” significantly, standardising the data exchange process and eliminating duplication of effort. It, however, does not alleviate your requirement to understand regulatory requirements around the world and know what to do with the data. How can you “bolt on” processes in order to achieve your objectives? These are several additional considerations for facilitating an integrated solution: • Stakeholder education. This is, perhaps, the single most important aspect of getting integrated compensation data management right. It involves talking to all stakeholders involved in this complex issue, understanding their needs, and helping them understand how working together to meet reporting requirements is beneficial to all • Site visits. To develop a mutual understanding of risks and create a solution that meets both global and local needs, you will need to involve the payroll managers and HR player who are involved with managing expatriates and business reporting • Cross-functional risk meetings. Global mobility is one area that sits among various functions, including tax, finance,


International HR Strategy payroll, human resources, and compensation and benefits. By assembling a cross-functional group of people who care about risk, developing a comprehensive list of risks associated with compensation data management, and then assessing those risks as a group, you can move toward improvement • Current-state assessment. This is countryspecific or global snapshot of what you think is being reported today versus your understanding of reporting requirements. From it, you can identify and begin to address key process gaps • Peer groups. Because global mobility represents a small portion of responsibility for many professionals, it can be helpful to network with others who also deal with these complex issues. Industry groups often provide opportunities for conversation about improvements and effective practices in this area.

The benefits of getting it right A consolidated, integrated compensation approach for your mobile employees can improve efficiency within your

organisation and strengthen your compliance profile with external tax authorities. For one thing, accurate expatriate compensation reporting for tax and social security reporting purposes is an essential to managing exposure in cases of tax authority audit. In addition, the right supporting platforms and common processes allow you to import data from home, host, and relocation of vendors into a single database - reducing time spent on local payroll, as well as potential turnover and/or retraining costs should a key payroll manager leave. Conversely, these platforms and processes can also export data back to home and host payroll, when and how they need it, thereby increasing accuracy and consistency. This also allows the company to analyse data and improve reporting capabilities. A consolidated approach also eases communication among stakeholders around the world and restores confidence in your global mobility function and programme. Finally, it allows more effective budgeting by allowing your managers to see the overall cost of mobility and make better informed decisions.

Philip Crossman is a Director leading Deloitte’s Global Payroll & Compensation Management team. He has unique experience in the field of international assignee payroll models and how companies address the complexities of managing cross border payrolls. He has led the implementation of global payroll models for a large number of Fortune 500 companies and was the winner of the 2011 Global Payroll Management award for the best Expatriate Payroll Team.

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Claire

Assunta & Fabrice on their wedding day

Pierre Tony Mondello and me on Assunta’s wedding day

Please help us raise money to build a nursery school in loving memory of Assunta and her family As many readers know, my late business partner Assunta Mondello, with whom I presented The American Hour Radio Show, managed The American Hour Online and the networking events we held, sadly and tragically passed away with her husband Fabrice and their two young children Pierre 5, and Claire 3, due to carbon monoxide poisoning in their home in France in January 2010. As a tribute to them, and Assunta's brother Tony, who sadly also passed away last year at the age of 34, I am going to raise £20,000 to build a nursery school in Uganda that will be named the Comard-Mondello School, in their memory. Assunta's two children were both at school, and Assunta was a big supporter of children's charities, so after months of trying to decide what to do in their memory, I am delighted to say that I now have a project which I know Assunta would have been proud to be associated with, and a financial target to reach. The North of Uganda has enjoyed peace for the last few years and the effects can be seen as people leave their temporary mud huts that housed them for up to 20 years, and head back to the land they once farmed. Joseph Kony has not completely left their minds as he continues his destruction in Congo, but, for now, for this community, there is hope. The children of this area have had more years of war than peace and many only know fear and danger. They have witnessed things that no child should observe. There are no professionals to explain the nightmares, or why they only draw guns. The schools in this area have a massive job ahead. There are at present a few primary schools in Uganda, but my aim is to build a nursery school attached to one of these schools, which seems fitting as Pierre was 5 and Claire was 3 when they passed away. I started the fundraising campaign in October last year by walking a marathon in London (I still have the remains of the blisters to prove it!), and so far I’ve raised nearly £10,000 which is great, but I still need to raise another £10,000. I have set up a Just Giving Page so that those who would like to contribute to this project, can. People will also be able to see how close to the target we get, and then once the project is underway, I will publish pictures in future issues of International HR Adviser. The address if you would like to make a donation is www.justgiving.com/Assunta-Comard-Mondello-and-family For further information on the charity that will be building the nursery in their memory, please visit www.abaana.org I would like to thank you for your support and look forward to letting you know how this worthwhile project, in memory of a beautiful family, is coming along. Best wishes, Helen xx


TAXATION

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Getting The Best Value From Your Tax Consultant You might be comfortable with your home country’s tax system, but add in the complexities of an international assignment and a foreign tax system and you might need some help. Tax consultants should help to ease your worries. Advice from consultants can fall into several categories, two of which are consultancy and compliance. To use an analogy, if we take advice as being like a cake: the basic sponge is compliance, it’s not the tastiest part of the cake but you need it. Without it you get in a mess; revenue authorities are only too happy to extract penalties and interest for non-compliance. Consultancy is both the ‘icing on the cake’ and the ‘filling’. This is usually the bit you really want: the nicest part of the cake! This element aims to reduce the considerable expense of international assignments. Whether you are looking for tax compliance and/or tax consultancy, how do you get best value from a tax advisor? In this article I have split the process of choosing an advisor into various headings. The key to each area is to ask questions, obtain answers and more importantly, gain understanding. This understanding must involve all parties who must understand the part each will play, what will be delivered, when and at what cost. Failure to understand will ultimately lead to confusion and dissatisfaction for all parties. This helps neither the client nor the consultant.

The proposal Proposals can take many different forms. They can range from a simple agreement for the consultant to act, to a full request for proposal (RFP) and the so called ‘beauty parade’, involving many consultants and client staff. At the outset of the proposal stage you need to consider who to ask and the format. There are many different types of tax consultants ranging from independent advisors to the big 4 and everything in between. Each type has advantages and disadvantages although, in these days of networks and modern communication methods, these are blurring. For example, independent advisors may be thought to be cheaper, provide a more personal service but do not have the network: big 4 may be

thought to have a larger network but are often regarded as being more expensive or impersonal. It is acknowledged here that such generalised comments may be completely untrue. Continuing and well publicised concerns over auditor independence highlight potential conflicts of interest as an issue to consider and this issue may further limit your choice of advisor. Think about what you really need, what you expect and what you want to pay? Consider service levels and value for money not just the monetary cost. During the course of the proposal you may find you need or want to reassess your expectations, be realistic in doing so. Consider a simple proposal, for example a telephone call to establish whether a consultant can do the work and, if so, the consultant is appointed. Questions should quickly flow in such a scenario, including what exactly is the work you want, what are your responsibilities as a client, what will be delivered by the consultant, when will it be delivered and how much will it cost? Naturally you can add lots more questions and variations on the examples quoted. This may appear to complicate matters but failure to resolve these issues is a recipe for future problems. The ‘beauty parade’ is generally a more comprehensive proposition. However it is certainly more complicated, detailed, time consuming and expensive for all. Whatever you choose to do, questions will still arise. For example, will the slick presentation team be the one actually working on your account or are they a separate ‘marketing’ or ‘transitional’ team? Will you ever work with them on an ongoing basis and will you talk to the lead partner again? The person who doesn’t get to say a word at the proposal or who comes across as too inexperienced; will they be your day to day contact? Is a glossy proposal with lots of charts and pictures what you really want? Does it add any substantive or extra value? Does a standard response to a procurement led proposal really provide the answers or does it just provide a lot of largely irrelevant data, which no one reads? Is a procurement led process, aimed primarily at buying goods/commodities, best suited to purchasing such a personal service? Alternatively, does an RFP give you exactly

what you need to make a decision? Do think carefully about the most suitable proposal process given the size of your international assignee programme. For example, do you really need the detailed RFP and full ’beauty parade’ for 10 global assignees? Five obvious yet crucial questions must be asked; • Can the consultant do the work? • Have they done it before? • What will it cost? • What will they do? • Will we like working with them? The responses and your thoughts will help you arrive at your decision.

The scope A key aspect in any discussion is to ascertain what exactly you want the consultant to undertake and who is eligible for assistance? What services are employees entitled to and have you told them? Who at the company can authorise individuals and work? Does the consultant know what you will and will not pay for? For example, too often individual employees or their spouses will telephone for advice for which they are not covered, but the time may still get charged to the client code. Communication is vital and should involve the consultant, the client and the individual taxpayer. Make sure you let your employees know what they can expect and what they are allowed. Let the consultant know who from your company can sanction advice. Ensure you are only paying for what you agreed and that the consultant knows this. If they do, they will happily follow your procedures.

Service levels Agreement should be sought over service levels to be met. Again lots of questions with answers are required. When will the consultant respond to telephone queries or general enquiries and what’s the turnaround time to prepare the tax return from receipt of the information? What information does the company need to provide and what does the individual have to provide? Is everything you request really urgent or can it wait a few days – be clear and fair. Your consultant should be only Winter  International HR Adviser

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taxATION too happy to suggest and agree a timetable of who does what and by when. It helps to plan workloads. Ask who will be involved with the account. Will you only get to deal with junior staff and do you have one or several points of contact? Tell your consultant what you would prefer. Service and fees often go hand in hand. If you want a very low fee, unless you have a particularly good bargaining position, ultimately you will generally end up with lower service levels and junior staff, irrespective of what is said at the proposal stage by the consultant. Whilst cost is always an important driver, service has a very big part to play. Remember tax consultants are human. If you treat them with respect they will respond more favourably. If you find you don’t get on with your designated contact, ask for a change. Firms will look to oblige as they generally want your business.

Fees The question ‘how much will this cost?’ is the tax consultant’s equivalent to ‘how long is a piece of string?’ The response should be the favoured retort of all tax consultants – ‘it depends’. Fees can be a source of dissatisfaction and are frequently cited in proposals as the key criteria for choosing an advisor. If you have addressed service and scope beforehand, fees should not be a problem as all parties should know what is being billed and the cost. Make sure it has been documented what you have agreed to pay and exactly what this covers. When choosing an advisor and comparing their fees are you really comparing like with like from the scope perspective? The £500 attractive tax return quote that you chose at the proposal stage may not include submitting the return or checking a statement of liability. Another advisor’s £700 quote may include all of these items and may ultimately end up cheaper! You must establish what is included and what is not. Is the foreign office bill paid by your consultant merely passed on or is it uplifted? Do ask especially if no coordination fee is being charged. What are consultancy hourly rates? Ask questions and clarify when you will be charged more than headline rates. Ensure employees know what they have to do and by when. Time can be incurred and fees accumulated purely down to lack of response by assignees. Make sure you do not allow your International HR Adviser  Winter 

employees to neglect their tax affairs thus avoiding a pre-deadline rush, as this will help to reduce your fees. A tax consultant’s get-out clause on fee quotes is usually something along the lines ‘the fee is based on the assumption of timely, accurate and complete provision of data’. In full defence of consultants we need this, as this is where costs can escalate and naturally consultants do not want to be exposed for any failings on the part of the client or the employee. Do ensure you know what this means and when it applies. Remember there may be a trade-off. If you want to have little involvement in the process, by implication the consultant has to undertake more work. The more you are prepared to do as a company, and the easier it is for the consultant to undertake the work, the cheaper it should be. For example, if the human resource department is prepared to chase expatriates for data completion and provides all information in one go, the benefits of economies of scale/batch working start to apply. Ask for the financial benefit to be passed to you. If you do not want to get involved expect to pay more. Use technology to collate data for example automatic downloads of data whether via spreadsheet or web enabled systems, into tax programmes saves the consultant time and money. If the consultant is getting you to undertake this work, they will ensure you get a fair share of their saving. Clients typically prefer a ‘no surprises’ basis when it comes to fees – so do tax advisors. It makes everyone’s role that much easier.

Value for money When it comes to consultancy advice, your advisor should be in a position to demonstrate their worth. A good consultant may not know all the answers but will certainly know all the questions to ask. They should be providing practical advice on how best to structure policies and packages in order to minimise liabilities and maximise opportunities. Not only should they be bringing you ideas and suggestions they should be available to help with implementation if required. Furthermore, can you tell what your consultant saved you? Remember that this saving may not always be tangible. For example, time savings or prevention of later problems through addressing noncompliance. Does your consultant justify their expense? Ensure you continually review this aspect, as changing your advisor may be easier than you think.

Right size, right fit Generally, choose an advisor that mirrors your organisation – size and fit - one that delivers the service you are seeking. For example, if you have thousands of assignees across a hundred plus countries then larger firms are usually better placed to assist. At the opposite end of the spectrum if you have fewer assignees across a handful of countries then smaller firms may be better placed to provide the service you want. Finally, are you and your employees satisfied with your consultant? Are they helpful and pleasant to deal with? Do they ask you for your opinion, do they undertake satisfaction surveys or seek assessment of their performance and are they proactive? Are they available? Do they provide the right blend of service and value for money? Seek to build a business relationship, ask reasonable questions and be reasonable. You will get better value from your consultant if you do. Enjoy the cake! Andrew Bailey is national head of human capital at BDO LLP. He has over 29 years’ experience in the field of expatriate taxation. BDO is able to provide global assistance for all your international assignments. If you would like to discuss any of the issues raised in this article or any other expatriate matters, please do not hesitate to contact Andrew Bailey on +44 (0) 20 7893 2946, email: Andrew. bailey@bdo.co.uk

BDO and CIPP seminar Real-Time Information – The Strategic Issues To Consider in 2012

17th January 2012, 8am - 10am, 55 Baker Street, London W1U 7EU Designed for Finance Directors, Human Resources Directors and senior Payroll Managers, we will highlight the wider strategic issues of RTI for your organisation that need addressing now, rather than waiting until introduction in 2013. Please email Shamim Pickles to register: shamim.pickles@bdo.co.uk For further information please see page 46


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GLOBAL taxation

Global Taxation Update AUSTRALIA Fringe benefits tax (FBT) changes Restriction of living-away-from-home allowance and benefits The Government has announced changes to the Fringe Benefits Tax regime as it applies to individuals receiving Living Away From Home Allowances and Benefits taxed on a concessional basis. With effect from 1 July 2012, the following changes have been announced: • Access to the tax exemption for temporary residents will be limited to those who maintain a residence for their own use in Australia, which they are living away from for work purposes, such as 'fly-in fly-out' workers; and • All individuals will be required to substantiate their actual expenditure on accommodation and food beyond a statutory amount. Permanent residents will be unaffected by the first mentioned change but will be affected by the additional substantiation requirements. As the reforms will apply from 1 July 2012, the Government should be able to undertake a consultation process prior to their commencement. This will hopefully allow appropriate transitional arrangements to be put into place. One of the reasons given for the changes is that the total amount of taxfree living-away-from-home allowance reported by employers to the Australian Taxation Office increased from $162 million in 2004-05 to $740 million in 2010-11. BDO’s view As the changes primarily affect the imposition of FBT, the impact will, subject to the terms of relevant employment contract, fall initially on employers. It would be prudent for affected employers to review the terms of employment of relevant employees before the commencement date.

GREECE Greece is the latest country to seek unpaid taxes in Swiss banks The European Union has announced that it is helping Greece negotiate with Switzerland in order to seek to recover significant unpaid taxes believed to be hidden in Swiss banks. The Greek Government wants to emulate deals agreed International HR Adviser  Winter

with Switzerland by Germany and the UK in recent months. BDO’s view We can expect to see continuing and similar moves from other countries.

NETHERLANDS Proposed changes to “30% ruling” concerning employees working in the Netherlands confirmed Proposals outlined in the Autumn 2011 edition of International HR Adviser were approved by the Dutch Lower House on 17 November.

SWEDEN Simplified qualification rules for the Expert Tax Scheme The Swedish Government is to introduce new provisions relating to the Expert Tax Scheme. With effect from 1 January 2012, foreign individuals who receive monthly remuneration exceeding SEK 88,000 (2012) will automatically be eligible for the scheme. The Swedish Expert Taxation Scheme applies to foreign key personnel such as executives, experts, scientists, researchers and others whose skills are difficult to find in Sweden. The main feature of the scheme is that income taxes and social security contributions are based on only 75 percent of the taxable income. The relief applies to all salaries and benefits such as free housing and allowances for living costs. The tax reduction also applies to stock options and other special compensation, provided it is offered by the Swedish employer. A number of "perks” (moving costs, children's schooling, home travel, etc.) which would normally be subject to income tax are also tax exempt under the scheme. Application for tax relief must be submitted by the employer or foreign person within three months of the start of employment. If granted, the relief will apply to the first three years of employment in Sweden. However, foreign key personnel may reside in Sweden up to five years. Swedish citizens are not eligible for the scheme and neither are individuals who have been a resident in Sweden during any of the prior five years. Finally, the employer must be a Swedish company or foreign company that has a permanent establishment in Sweden.

In essence, experts, research workers and other key personnel may be taxed under the Expert Taxation Scheme if the skills required for their position are such that it is significantly difficult to recruit domestically. Employers are therefore required, among other things, to show thorough documentation of the recruitment process in order to confirm the difficulty of finding comparable skills though local hire. However, under the current provisions and legal practice very high levels of competence and specialisation are normally required. This means that it is often difficult to predict if the relief is likely to be granted for a specific individual or not, even if detailed and comprehensive supporting information is submitted. Under the new provisions an employee is deemed to fulfil the requirement of specialist expertise if the remuneration package received for the work in Sweden exceeds two price base amounts per month. The new remuneration threshold is set by the price base amount (prisbasbelopp) for the calendar year in which the work in Sweden commences, this means that for 2012 a salary of SEK 88,000 per month is required. Individuals who do not meet the new salary criteria will still be able to qualify for the scheme under current provisions, i.e. by having unique competence which is unavailable or not readily available in Sweden. For such individuals, full documentation of special expertise and difficulties in recruiting locally will still be required. BDO’s view The new and simplified qualification method provides greater certainty in eligibility for relief. The application process for those with qualifying compensation packages will also be less demanding as reduced supporting documentation will be required. The provisions are welcomed.

UAE & KENYA New double taxation agreement The UAE and Kenya have signed a double taxation avoidance agreement. UAE's national airlines will be exempted from taxes in Kenya. Students, sovereign funds, staff members of airlines, together with income and capital in both the public and private sectors will also be exempted from tax.


global taxation UNITED KINGDOM HMRC announces the postponement of the Statutory Residence Test (SRT) until 6 April 2013 In Budget 2011, the Government announced its intention to introduce the SRT with effect from 6 April 2012. A consultation period followed during the summer, after which it was anticipated that draft legislation would be released before the end of 2011. The Government has now decided to allow further time to finalise the detail of the SRT and this will now be introduced with effect from 6 April 2013. Reforms to the concept of ordinary residence will also take place at the same time. The draft legislation is now expected to be published near to Budget 2012, together with a further consultation exercise. What does this mean for your internationally mobile employees? The announcement means the current UK tax residency rules will continue to apply until 5 April 2013. The challenge this presents to internationally mobile employees and their employers is that it was already widely recognised that the rules in their current form do not operate in a satisfactory way. There is a lack of clarity to the rules, which stem from them being a combination of case law and HMRC guidance, as opposed to binding legislation with statutory weighting. In view of the fact that they will remain in force for a further tax year, we have highlighted below some of the areas to consider but given the complexities individuals and their employers are advised to seek professional advice. Outbound assignees For assignees leaving the UK, HMRC have in recent months stepped up their scrutiny as to whether the individuals are working full time overseas for a full UK tax year (6 April to 5 April). This along with certain day count tests are requisites of an individual breaking UK tax residency. Two particular areas where we have seen HMRC challenging non-resident status are: 1. Start of full-time employment overseas. It has not been uncommon for individuals to leave the UK immediately before the end of a UK tax year, but not to commence their formal work until shortly after the next UK tax year has started. Outbound assignees should be aware of the need to ensure that they are both outside of the UK and have commenced their formal role on assignment

before the start of the UK tax year following their departure from the UK, to strengthen the position that they are non-resident in the UK. 2. Non-incidental workdays in the UK – HMRC released an update earlier this year stating that they reserve the right to review the UK tax residency position of outbound assignees spending 10 days or more undertaking non-incidental work back in the UK. The issue of nonincidental workdays has been viewed as a historical grey area, but broadly if individuals are performing work in the UK which is of similar nature to that performed outside the UK, HMRC may seek to contend that the UK work is non-incidental. While it was anticipated that the implementation of the SRT would provide clearer rules for assignees leaving the UK, we would expect HMRC to continue to scrutinise these areas until the eventual introduction of the SRT in April 2013. Individuals who continue to undertake work in the UK but are working in low tax jurisdictions, and those jurisdictions with which the UK does not have a double taxation agreement, are most susceptible to HMRC challenge. Inbound assignees The main area of HMRC scrutiny has been in respect of Resident but Not Ordinarily resident (RNOR) status. The RNOR status, which enables assignees to claim relief for overseas workdays, has broadly been available to individuals who arrive in the UK intending to be in the UK for less than 3 years and who meet other criteria such as not being UK home owners. Recent tax cases and HMRC practise has looked increasingly at the nature of an individual’s connections to the UK and whether they had developed a settled pattern of presence in the UK. A settled pattern of presence in the UK could result in an individual being considered to be Resident and Ordinarily Resident (ROR), regardless of their intentions, and therefore unable to claim overseas workdays relief. Again, we were awaiting the introduction of the SRT to have clarified HMRC’s future plans for the RNOR and ROR statuses and to help all understand who would be eligible for overseas workdays relief going forward. In the meantime, assignees and their employees should seek professional guidance so that, where applicable, they are aware of steps they can take and pitfalls to avoid in strengthening

their claim to overseas workdays relief. Impact of the domicile review on internationally mobile employees The points below have been announced as part of the ongoing review into the UK’s domicile rules. Foreign currency bank accounts – HMRC has indicated that they plan to give exemption from UK Capital Gains tax to withdrawals from foreign currency accounts from 6 April 2012. This is welcome news given the complexities and inherent unfairness of the current position. Statement of practice 1/09 – this relates to the way that assignees working both in and outside the UK who are eligible for overseas workdays relief, identify the remittance of employment income to the UK. HMRC have indicated that they are committed to introducing legislation to give greater certainty to assignees and to simplify the compliance process, but they will not take steps to do so until 6 April 2013. BDO’s view The deferral of the new statutory residence test by one year is disappointing for both professionals and taxpayers. Assignees will continue to face uncertainty for a further tax year, especially those who are leaving the UK. Although it was accepted that the new residence rules in their draft form required some clarification, the basic principle of the SRT was well received and initial reaction was positive. The consultation process period has, however, highlighted various issues and practical considerations which required further thought. The Government’s delay in introducing the legislation would therefore seem to be consistent with their overriding aim of ensuring that when the new test is implemented, it will consist of clear rules that are “transparent, objective and simple to use”. BDO will continue to keep you updated in respect of developments towards the introduction of the SRT.

Prepared by BDO LLP. For further information please contact Andrew Bailey on 020 7893 2946 or at andrew.bailey@bdo.co.uk

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IMMIGRATION

The Pace Of Change Works Both Ways: Allowing The UK Migration System To Settle Down Migration is a divisive issue. Since the Accession States joined the EU in 2004 and unprecedented numbers of Eastern European workers moved to the UK, there has been a bedrock of support for successive Governments to reduce numbers. The public needs to believe that the system is under control. Public concern with immigration centres mainly on asylum seekers and the displacement of British employees by foreign workers. Although public concern is focussed on low skilled jobs, the system around highly skilled roles has in practice borne the brunt of immigration reform. Successive Governments have attempted to reassure the public by reforming and reshaping migration policy. The message has always been that numbers will fall and that commitment is explicit in the current drive to reduce net migration to the tens of thousands. The Coalition has pursued this agenda since the election. The cap on skilled workers has been the top line migration commitment but is only part of the picture. Since the election we have seen five consultations relating to work permits, almost all aimed at reducing the inflow of skilled migrants. While this is understandable in the current climate, the problem is that pace of change works both ways. Now is the time to pause for breath and take stock of what the changes mean for business. It is no secret that the Government's work permit policy and especially the cap has not been welcomed by business. Economists and employers can see that a strong economy comes from a strong and flexible workforce. If the UK is unable to grow the right type of workers then employers need to look abroad. If the UK wants multinational companies to base themselves here, we need a diverse, global workforce. The legal sector lends itself well to illustration. British lawyers and our justice system are the envy of the world. British legal expertise is an eminently exportable product but it cannot sell itself. Foreign students and lawyers want to International HR Adviser  Winter 

come to the UK to study and work and we need a system that allows them to do so. While some will want to stay in the UK permanently and contribute to the development of their adopted country, many will choose to go home and will stand out amongst their peers by virtue of their UK exposure. If the UK is to retain its position as a global hub we also need a global legal workforce. Many overseas clients expect attorneys who can speak a local dialect and understand different cultures and legislative systems. Like other businesses, law firms will lose opportunities if we cannot attract and retain skill sets valued by clients. Businesses in all sectors worry that the cap on skilled workers will limit access to talent and impinge growth. Employers need to know that if a skills gap exists, they will be able to plug it. The spectre of a hard numerical cap reduces certainty and saps confidence. Employers ask why any government would want to limit skilled labour when the economy needs to grow. Many believe that if we can attract the world’s best talent, British jobs will be created around them. Of course it isn’t all black and white. But while the Government's migration agenda may be a challenge for employers it need not be a barrier. The impact of the quota has been much less than originally feared and in reality the system, as currently shaped, can and does work for business. The Government has set a cap of 20,700 for the year from 6 April 2011. If current trends continue only half of the current quota will be used. The monthly quota system may not be as fast as some would like but it bears favourable comparison to the annual American cap for H1B visas which is used within a matter of weeks. When we do share some of our frustrations about the UK system with our colleagues overseas, we quickly realise that the UK system is head and shoulders above many other jurisdictions. It is also clear that the Government listens to business as well as Home Office Ministers and officials.

By way of example the June 2010 consultation paper proposed a New Zealand style cap and a quarterly “first come first served” quota system. Businesses told the Home Office that they needed more certainty and this was taken on board. The system now prioritises the best workers and provides flexibility for urgent cases. The new Exceptional Talent route came into force in August 2011 and allows organisations like the Royal Society and the Arts Council to issue visas for world leading scientists and artists. The UK is definitely a world leader in devising innovative policies which delegate assessment and decision making to bodies better placed than a civil servant to make a judgement on skills and ability in a particular sector. In 2009 officials worked with experts from the legal sector to reshape the rules for milk-round graduate recruitment and the way salary packages were calculated. New routes were also introduced at employers requests to enable skills transfer and international graduate rotation. These relatively small changes made a big difference for employers. The Government can and should tinker with the system. It needs to iron out wrinkles and deal with any unforeseen consequences, not least because it is imperative that the UK Border Agency has the confidence of the electorate. However in the last two years we have seen four wholesale policy reviews despite the system being just three years old in addition to the five consultations we have mentioned. In the latest Migration Advisory Committee report commissioned by the Government, Home Office Ministers have asked whether the skills level should be increased (which would remove a number of roles from the approved list including – controversially – nurses and paramedics). It also asks for evidence as to whether non-salaried payments should be ignored for intra company transferees and whether long-term intra company transferees (over 12 months) should be paid more than £40,000.


IMMIGRATION We would all be the losers if high quality foreign nurses are prevented from filling skills gaps. Transferees from the developing world often have their salaries increased before coming to the UK so that they are paid market rate. That is only right - migration should never be used as a means of underwriting resident workers – but such a policy could have unintended implications. We understand that in India, if an assignee’s salary is increased when he is posted overseas, the employer cannot legally reduce it when he returns to India. Imposing these changes on business could ultimately impact on the UK’s trade with those nations. The Migration Advisory Committee in all fairness has an excellent record of providing good policy advice. The issue is less that the resulting policy could be damaging than that the question was even asked. The Government must shape the immigration system as they believe the public would like to see it. It has pushed through a lot of change in recent months and it would be wrong not to recognise that this took real political leadership. However, its insistence on constantly

changing the migration system is simply not good for business. Any area of regulation in a state of permanent revolution reduces certainty and saps business confidence. Multinational corporations will not bring work to the UK if they cannot be reasonably sure that essential expert staff will be able to follow the investment. What is needed now is a chance to let the system bed in and see how it works. The Government is keen to convey the message that the UK is open for business but the continued changes creates the opposite perception. Our plea and the foundation of our response to the latest consultation is simple: we have a good system which largely works well; refine by all means but allow it to settle so that the message spreads that our systems are largely flexible, well managed and can meet business needs. Caron Pope, Partner at Fragomen LLP. T: +44 (0) 20 3465 2910 F: +44 (0) 20 3077 5001 Email: cpope@fragomen.com

Caron has more than 20 years of experience as a lawyer practicing solely in the field of UK immigration and nationality law. Caron has extensive expertise in all categories of applications under the Points Based System (PBS), servicing a wide range of employers in diverse industry sectors including financial services, pharmaceutical, technology and IT, professional services, oil and gas, retail businesses and engineering. She also advises and manages the process for employers to be licensed as sponsors. She is a leading expert on Tier 1 (Investor) applications, acting for both clients of private banks and high net worth individuals worldwide, with a particular profile in Eastern Europe and China.

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Global Immigration Update

Global Immigration Update SPAIN New Regulations Cause Processing Difficulties for Employers (November 8, 2011) Spanish authorities continue to provide new official interpretations of the immigration reforms that took effect in June, which is further complicating the entry of foreign workers and making the transfer of foreign talent unpredictable. Though the reforms were largely procedural and did not impose substantive restrictions on employmentbased immigration categories, they have caused new immigration processing difficulties for many employers. As a result, employers should review the recent changes to Spain’s immigration policies, but should also keep in mind that the situation in Spain remains fluid because the implementation of the changes has been inconsistent. Impact on the Large Business Unit Fast-Track Processing Programme Some foreign nationals who used to qualify for expedited immigration processing through Spain’s Large Business Unit (Unidad de Grandes Empresas) no longer do so, as a result of the Unit’s new minimum salary requirement. To qualify for processing at the Unit, a transferee’s salary must be at least 1.5 times the minimum salary set by the Spanish National Statistics Institute (INE) for the employer’s National Classification of Business Activities (CNAE) activity code. The minimum salary, which is unique to the Unit, has also caused employers to adjust their Spanish job offers. It was thought that the new rules would lead to faster processing times and allow more employers to benefit from the Large Business Unit, because they eased eligibility requirements for the Unit, primarily for employers in research or development sectors. However, whether an application qualifies under the eased requirements is subject to the discretion of immigration authorities, who have been requiring employers to provide extensive supporting documentation of their strategic contributions to Spain’s economy. Labour Market Test for Intracompany Transferees Foreign nationals applying for a work International HR Adviser  Winter

permit as an intracompany transferee are now subject to a labour market test, unless both the sending and host companies belong to the same group of companies and have common ownership or unless the work permit application is filed at the Large Business Unit. Recently, employers have had difficulty successfully completing labour market tests, which are subject to a high level of scrutiny. Applicants for intracompany work permits under third-party service agreements are particularly likely to face stringent labour market testing. Authorities now require labour market test results to be legalised or accompanied by an apostille, which is further delaying the application process. Implementation of the EU Blue Card Applicants for Spain's version of the EU blue card – a new work permit class for highly skilled employees and researchers – may need to pass a labour market test. Given the high level of scrutiny currently being applied to labour market tests, obtaining Spain’s Blue Card can be difficult. Blue Card applications are exempt from labour market tests if filed through the Large Business Unit. Reporting Requirements for Direct Hires Changing Work Sites or Positions Direct-hire work permits are currently granted for a specific business activity. Within the first year of validity, these permits can only be used within the Spanish province where they were issued. Employers that wish to transfer a local work permit holder to a different location or job position must notify and seek approval from immigration authorities. This reporting requirement has been strictly enforced in recent weeks. Work Permit Requirement for Romanian Nationals Despite EU rules, Romanian nationals are still being required to obtain work permits, except those who obtained a residence permit prior to July 22. Authorities are expected to evaluate whether to continue imposing this rule by the end of 2012. Romanian nationals applying for a work permit are not subject to a labour market test or required to obtain a visa.

Long Wait Times in Madrid for EU Citizen Registrations In Madrid, there are long wait times to schedule appointments for EU citizen registrations and family residence cards. The earliest appointments for EU citizen registrations are in March 2012, and in July and August 2012 for family residence cards. Employers should be mindful of these delays when planning assignments to Spain. Additional Document Legalisation and Apostille Requirements Employers have recently been asked to comply with document legalisation and apostille requirements that may not be compatible with certification requirements under Spanish law. In other cases, authorities required applications be filed by a legal representative of the sponsoring entity, and not by a representative of a group of companies, thereby requiring every host company to appoint their own legal representative to hire foreign national personnel in Spain. What the Changes Will Mean to Employers In the Near Future The regulatory situation in Spain remains in flux, and employers should be prepared for further changes as government authorities issue new guidance and instructions on the immigration rules. Employers should also be prepared for the possibility that rules and requirements may be applied inconsistently. As implementation continues, there may be contradictions between recent government guidance and actual case outcomes.

DOMINICAN REPUBLIC New Law to Require Immigration Applications to be Submitted by a Registered Attorney (November 15, 2011) Beginning in early December, all immigration applications for the Dominican Republic will need to be filed by a registered attorney and accompanied by a notarised power of attorney. This is the first of many upcoming changes to the Dominican Republic’s immigration system under recently-enacted legislation that is expected to be completely implemented following the country’s presidential elections in May 2012. In general,


Global Immigration Update the legislation is expected to expand the government's role in immigration processing through both the creation of new agencies and the addition of existing agencies to the adjudication process. It is also expected to modify procedures for foreign nationals seeking to change from temporary to permanent status and introduce more stringent medical insurance requirements for all foreign workers. The situation in the Dominican Republic will remain fluid until authorities begin to formally implement the new legislation, and additional requirements and changes are possible. Employers should take these possibilities into account when planning assignments to the Dominican Republic over the coming months.

UKRAINE Registration Requirement for Employers Hiring Foreign Workers; Temporary Residence Permits for Dependents (November 16, 2011) Ukrainian immigration authorities have begun to strictly enforce registration and certification requirements for employers seeking to employ foreign workers, pursuant to recent legislative changes to the Ukrainian visa system. All employers must now register with the Ministry of Internal Affairs before they can employ foreign nationals or issue invitation letters to prospective foreign workers. Previously, this registration requirement was not stringently enforced. In addition to registering, a representative office of a foreign company must also certify its invitation letters with the Ministry of Economic Development and Trade, and representative offices of foreign banks must certify their invitation letters with the National Bank of Ukraine. A foreign national must now present the certified invitation letter when applying abroad for a type D visa and for a temporary residence permit after entry. In other news, dependents of foreign workers will qualify for temporary resident permits starting December 25. Registration Process To register with the Ministry of Internal Affairs, an employer designates a representative employee responsible for handling registration matters for both the employer and the foreign workers. The representative physically visits the Ministry and adds a prospective foreign employee's name to the

employer’s registration certificate for each temporary work permit that the company obtains. The Ministry may also require, in its discretion, the individual foreign worker to make a personal appearance. The duration of the registration process is unclear, but unregistered employers should register as soon as possible to avoid processing delays. Temporary Residence Permits for Dependents of Foreign Workers Beginning December 25, 2011, dependents of foreign workers who will not seek employment may enter the country with a Visa type D obtained at a Ukrainian consular post, which requires the principal’s certified invitation letter. After entry, the dependent may then obtain his or her own temporary residence permit based on his or her dependent status. Under previous policy, dependents could only obtain six-month visas and were required to leave the Ukraine and re-enter if they wished to stay beyond six months, and had to complete the foreigner registration process each time.

VIETNAM Government Circular Clarifies Work Permit Requirements for Heads of Representative Offices, Reporting Obligations for Employers and Foreign Workers (November 21, 2011) Vietnam’s Ministry of Labour has clarified that heads of representative offices of foreign commercial companies are required to obtain work permits. It also provided standard forms sponsoring employers can begin using from December 18 to meet new reporting requirements. The clarification, released in a Ministry Circular, was necessary because immigration reforms that took effect in August of this year resulted in some uncertainty about requirements and negative feedback from the business community. Work Permits for Heads of Representative Offices of Foreign Companies The Ministry’s Circular confirms that a foreign national heading a representative office of a commercial company must obtain a work permit. If a foreign national is already in Vietnam heading a commercial entity’s representative office without a work permit, he or she must obtain one to continue working. Only foreign nationals heading representative offices of non-governmental

organisations are exempt from the work permit requirement. Vietnam has required heads of representative offices to obtain work permits since 2008, but the earlier immigration reforms appeared to eliminate this requirement regardless of an employer’s commercial nature. Work Permit Exemptions for Certain Service Industries The August legislative reforms created a work permit exemption for intracompany transferees working in service industries covered by Vietnam’s World Trade Organisation commitments. Despite expectations from the business community, the Ministry did not provide additional guidance on how this work permit exemption is being implemented. The work permit exemption covers intracompany transferees working in business-related services (such as accounting, engineering and tax services), information, construction, distribution, education, environment, financial services, health, tourism, entertainment and culture, and transportation. Reporting Requirements for Sponsoring Employers and Foreign Nationals Included in the Ministry’s Circular were standard forms sponsoring employers can begin using from December 18 to meet the extensive reporting requirements introduced in August. Currently the forms are available only in Vietnamese, but English translations are expected in the next few weeks. Under the August reforms, employers are required to notify labour authorities within seven days of a permit-exempt foreign national’s start date and file annual reports with the Ministry of Labour detailing their projected need for foreign workers. When applying to extend a foreign worker’s permit, employers are required to submit a training contract with a Vietnamese national who will eventually replace the foreign worker once he or she departs the country. The business community had hoped the Ministry would use the Circular to relax some of these new reporting requirements, but it only released the new forms. The Ministry clarified that foreign nationals must report to their provincial labour authorities if they will work in a different province for more than ten consecutive calendar days or more than 30 calendar days in a one-year period. Foreign nationals must therefore keep track Winter  International HR Adviser

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Global Immigration Update of their employment in provinces other than the one that originally granted their work permit.

INDIA New Registration and Extension Procedures in Mumbai (November 21, 2011) The Mumbai Foreigners’ Regional Registration Office (FRRO) has introduced new registration procedures, including an online registration application. The FRRO has also begun requiring extensive tax documentation for employment visa extensions. New FRRO Registration Procedures Under a revised registration system, foreign nationals must complete and print an online application at least one day before visiting the Mumbai FRRO to register. The FRRO accepts registration applications on a first-come-first-served basis from Monday through Friday between 9:30 a.m. and 1:00 p.m. (IST). Foreign nationals will not be able to register unless they bring the completed online form with them. They can no longer complete the registration application at their FRRO visit. In a related development, the Mumbai FRRO now issues a single residence permit document to foreign nationals who have completed the registration process. The FRRO has eliminated the registration booklet that was previously issued. Additional Tax Documentation Required for Employment Visa Extensions Foreign nationals applying to extend their employment visas at the Mumbai FRRO must now submit their employer’s most recently updated Form 26 AS, a consolidated tax statement issued by the Indian Income Tax authorities detailing employer tax deductions or collections from an employee’s salary and any advance tax deposits made on behalf of the employee. Foreign nationals must also attach their individual tax payment receipts to the Form 26 AS. In the past, the FRRO accepted consolidated tax payment receipts accompanied by a statement on company letterhead detailing monthly tax deductions, in lieu of the formal tax documents. The government has instituted the new requirement because it wants better confirmation that taxes are properly being withheld and remitted to the Indian Treasury. It will take time for employers and foreign International HR Adviser  Winter

workers to collect the additional tax documentation, so employers may have to start preparing extension applications further in advance than they have in the past.

tries as transitional measures but could only extend them beyond 2011 if their elimination would adversely disturb the domestic labour market.

UNITED KINGDOM Migration Advisory Committee Advises on Permanent Residence, Family-based Migration; Work Permit Requirements Extended for Romanians and Bulgarians (November 29, 2011)

What the MAC’s Recommendations Mean for Employers While not binding, the MAC report will likely carry significant influence in any upcoming changes for Tier 2 of Points Based System. In the past, the Home Office has acted on MAC recommendations in one to three months. Each of these reports could have implications for employers, particularly as the MAC conducts its review of Tier 2 of the Points Based System. For example, if the UK Border Agency were to adopt the MAC’s recommended minimum annual salary for Tier 2 workers seeking permanent residence, these workers would not be able to reside and work in the country beyond five years unless they met the minimum salary requirement.

The Migration Advisory Committee (MAC), the UK’s independent advisor on migration issues, recommends in two new reports a minimum salary requirement for skilled foreign workers seeking permanent residence and an increase to the minimum income thresholds for sponsored family members. The UK will extend work permit requirements for Bulgarian and Romanian nationals for two more years, based on a Committee recommendation. Permanent Residence Some Tier 2 Workers: The MAC recommended setting a minimum annual salary between £31,000 and £49,000 for foreign nationals working in the UK under Tier 2 of the Points Based System to qualify for permanent residence. In June, the MAC was asked for recommendations on how permanent residence could be restricted for Tier 2 workers. Minimum Income Levels for Family Members: The MAC recommended the government set a minimum salary between £18,600 and £25,700 for British citizens or permanent residents seeking to sponsor dependent family members for immigration benefits. They also recommended the government raise the current minimum salary for those sponsoring a parent. In July, the MAC was asked to provide advice on what minimum income thresholds would avoid family members becoming a burden on the State. Work Restrictions for Romanian and Bulgarian Workers: Bulgarian and Romanian nationals will continue to be subject to the UK’s pre-Points Based System work permit requirements until the end of 2013, the UK Border Agency announced after considering the MAC’s finding that eliminating these requirements would seriously disturb the UK labour market. When Romania and Bulgaria joined the European Union in 2007, member countries were allowed to maintain work restrictions for nationals of both coun-

BELGIUM Minimum Salary Requirements to Increase for Type "B" Work Permits in 2012 (November 29, 2011) Effective January 1, 2012, the minimum base salary for highly skilled foreign workers applying for Type “B” work permits will increase to €37,721 from €36,604. The minimum base salary for senior management or executive-level positions will increase to €62,934 from €61,071. Foreign nationals applying for work permits as trainees are exempt from the minimums. The Ministry of Employment and Labour reviews minimum salary requirements for Belgian work permits on an annual basis. The minimums are generally enforced by the regional employment authorities where the work permit application is filed. Once the new salary levels take effect on January 1, new and renewal work permit applications that fail to evidence the new minimums will be rejected. Employers should review the new minimum salary requirements with their immigration service provider prior to filing a new or renewal Type “B” work permit application.

BRAZIL Foreign Workers Under Local Contract Cannot Extend Two-Year Employment Visas, Must Seek Permanent Visa to


Global Immigration Update Remain in Brazil (December 2, 2011) Effective immediately, foreign nationals working in Brazil under a local employment contract cannot renew their initial two-year employment visas. To remain in Brazil for more than two years, they must apply for a permanent visa pursuant to an indefinite labour contract at least 90 days before their initial visa expires. Pending applications to extend a temporary visa must be converted to a new permanent visa application. This new rule was implemented following a meeting between the Ministry of Justice and the Ministry of Labour on November 23. It is expected that permanent visas will be conditional for an initial two years. At the end of this period, the foreign national will need to prove that he or she is still working in Brazil for the same employer, after which

an unrestricted permanent visa and new identification card (RNE) will be issued. The permanent visa will not allow the foreign national to act as a director of the Brazilian company. A separate category of permanent visa is appropriate for this purpose. Previously, foreign nationals working in Brazil under a local employment contract could seek a two-year extension of their initial visa, after which they would apply for a permanent visa. This new rule is intended to protect employee rights, as it favours the indefinite employment contracts over limited duration contracts. What the New Rule Means for Employers Now that the visa regulation has been implemented, employers will need to consider the timing of permanent visa applications for foreign workers holding

two-year employment visas under local contracts. The permanent visa application is required to be filed at least 90 days before the expiration of the employment visa. However, Fragomen recommends filing the application seven months in advance, as this is the actual length of time expected for both the Ministry of Labour and the Ministry of Justice to adjudicate the permanent visa application. The content herein is provided for information purposes only. If you have any questions, please contact Fragomen Global Immigration. Fragomen has 35 offices in 15 countries. For further information, please contact: Global Knowledge Team Fragomen Global, LLP +1 (212) 688 8555 (direct) globalknowledge@fragomen.com www.fragomen.com

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International Mobility: The Ongoing Dual-Career Challenge Despite the recent economic downturn and continuing volatility in world markets, international assignments remain essential to the expansion and competitiveness of multinational companies. In a recent survey conducted by the Permits Foundation, (2011 Survey of International Mobility and Dual Careers) 74% of organisations stated that it was very important for them to be able to transfer employees internationally to ensure they are able to meet their business expansion objectives. The number of expatriates continues to rise with growing numbers being sent to emerging markets, particularly the BRIC (Brazil, Russian, India, China) countries. But as mobility increases, so does the need to address the issue of dual careers and partner employment.

What are the implications for employers? Although not a new factor in managing international assignments, the issue of dual careers is even more important today in light of economic uncertainty and changing demographics. Employers face a dual dilemma: being mindful of cost constraints while needing to attract and retain the best talent to remain globally competitive. Nearly 70% of organisations stated that the issue of partner careers had impacted their ability to attract employees for an international assignment, with more than half experiencing assignment turndown. In addition, more than 28% of the respondents had to deal with incomplete assignments, as expatriates returned early due to partner concerns. Despite these findings, a surprising 91% of companies did not measure the cost impact of assignment turndown or early return. In fact, less than 25% maintain any metrics at all on this matter.

What are the implications for expatriates-to-be? In the future, living and working abroad will become increasingly commonplace. As more Baby Boomers retire, the number of Generation X and Y’ers

going abroad will rise. Many of these future assignees will have partners who have their own careers. When faced with a potential relocation, these partners will be less willing to give up their jobs and associated income to accompany their partner on assignment. This point is especially true in light of economic instability and the uncertainty of employment in the host location. One of the key findings from the Permits Foundation 2008 Survey of Global Spouse/Partner Survey was that, before an assignment, nearly 90% of partners were working; this percentage dramatically dropped to 35% during expatriation. Of those not working, 75% stated they would like to work in the host country and the ability to do so would influence their decision to relocate, extend or complete an assignment. Nearly 60% of participants in the Spouse Survey were unlikely to relocate to a country with work permit restrictions. The challenges of managing two careers are not easy at the best of times and become much more complex when a couple move abroad. It is not just the challenge of getting the right job, but also getting permission to work. As more countries introduce measures to restrict employment of foreign nationals to protect the jobs of domestic workers, the situation is likely to become more acute. Ultimately, it will have a major impact on mobility.

Partner support Most companies do not differentiate between spouses and partners in the provision of assistance and are increasingly prepared to recognise non-traditional partnerships. However, many organisations have experienced work permit and entry restrictions for unmarried or same-sex couples in certain countries. Regardless of the definition, the majority of employers (70%) recognise that dual careers and partner issues are becoming more important in their organisation. Yet, the number that have a formal partner support policy has decreased in the past 10 years from around 80% to 35%. On the positive side, a further 34% provide support on

an informal or case-by-case basis. Viewed from a practical perspective, employers should consider the following reasons for introducing partner support, as cited by survey participants: 76% Increase staff mobility 56% Become a more attractive employer 49% Implement family friendly polices 30% Meet corporate social responsi- bility goals 27% Reduce the cost of assignment refusal or early return 21% Support gender and diversity initiatives Exacerbating the problem for assignee couples, employers have reported a significantly reduced level of partner support in recent years. Ten years ago, allowances of €10,000 were not uncommon, but times change. In the recent Permits Foundation Survey, employers offered allowances ranging from €1,500 to €4,000, either per annum or per assignment. The most common types of support being provided were: • Language tuition • Cultural orientation • Work permit assistance • Job in employee company • Job search advice • Career counselling • CV advice • Education or training allowance • Advice on tax and pensions • Self-employment or business start-up advice. Employers generally provided the majority of support at the start of the assignment, and continued it during the expatriation term. However, on repatriation, few companies provided re-entry support to assist the partner in returning to the home-country job market. This concern troubles many partners who wish to continue their careers at home, but need career counselling support to do so effectively. An increasing number of companies use the services of external organisations that provide career and counselling support to partners. This trend may partially explain some of the decline Winter  International HR Adviser

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dual careers in formal partner support policies, as the company pays the service provider directly. Companies may also work with employer networks or organisations such as the Permits Foundation, Partnerjob.com and others. Employers are also implementing alternative assignment types to overcome dual-career barriers/partner employment problems in the host country: unaccompanied (68%), short-term (64%), and commuter (42%) assignments. These assignment types are not ideal, since they require the couple to live apart for a period. But they can provide a solution if the partner is unwilling to give up a career in the home country.

So what is the answer? With finances a significant concern, employers are hard pressed to offer more money to partners. However, some alternative interventions can help companies better manage dual careers in their organisations: • Seek feedback from expatriates and partners, and review the existing partner support policy in light of concerns expressed on barriers to accepting and completing an assignment • If no formal policy exists, consider creating one or preparing informal guidelines. This action, which will provide clarity on what support the company provides, will be welcome to partners and managers alike • Provide clear communications to partners about the assignment and involve them in the decision-making process so they can make a choice on whether or not they will be able to succeed. This step could prevent a costly failure further down the line • Offer more support to partners who are keen to continue their career in the host country. This assistance can be available through an external career counselling service such as NetExpat. Some companies go so far as to offer the partner employment in the company, although this practice is less common • Ensure candidate selection processes are implemented and followed and that the correct parties – global mobility, talent management and others – are involved in the expatriation process. It ensures that the employee and partner are fully prepared for the assignment, both personally and professionally International HR Adviser  Winter 

• Recognise that the expatriate candidate pool is changing due to demographics and globalisation. The sourcing of talent from emerging markets will bring new challenges because partners will have different needs and expectations • Analyse the cost, benefits and return on investment of providing spousal support. Introduce metrics on tracking assignment turndown and failure. Monitor these measures and the overall return on investment to the organisation • Benchmark and share best practice with other multinationals • Establish informal partner networks via the company intranet and other forums • Consider the different needs of partners at different ages and stages in their career.

The future! Unlike the early days of expatriation, success in attracting and retaining a global talent pool of employees willing to accept an international assignment now depends greatly on the willingness, attitude and circumstances of the employee’s p ar tne r. Over 70% of employers believe their organisation should be doing more to support par tners. To ensure employers are able to move the right people to the right place at the right time, they need to give the issue of dual careers the recognition it deserves – or employees will just stay put.

Siobhan Cummins has worked in the mobility industry for around 25 years. She is a well known expert in the field and until recently was a Partner at Mercer, heading up the Centre of Excellence for Mobility, EMEA. Prior to this she was Managing Director EMEA for ORC Worldwide. She is a companion of the CIPD, a member of SHRM and World@Work. In addition she is on the Board of the Permits Foundation and the Advisory Council of AHRMIO. She is currently working as an independent consultant. Contact: siobhan.cummins@gmail.com


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State Of The Industry 2012 If confidence is the key to a strong global economy, the debt crisis in the Eurozone has imposed a deep sense of self-doubt in markets throughout the world. The mobility industry is a clear thermometer for what happens within the global economy; when the multinationals sneeze, relocation providers gets the ‘flu. In an attempt to make some sense of what’s been happening in the worst hit European economies, I have been talking to industry leaders and asking for their interpretation of changes within European mobility. Jacqueline Biersma, Relocation Director for TEAM Relocations agrees that the mobility industry is amongst the first to be at the receiving end of corporate change; “By tradition, our industry is one of the first to be hit when economies slow down. As the traditional mobile work force is more expensive than employees recruited locally, programmes could easily be stopped, albeit temporarily. Across Europe we sense our clients to be acting with caution. Strategic HR and management, development and leadership planning continue to be challenging to most companies. Whether for the best or not, it doesn’t change the fact that future leadership can be affected.” Greece has so far been the most wounded casualty in the debt crisis and the lack of confidence that markets have in its ability to service its debt is leading to profound social and political change and this having a big impact on mobility. Maria Christina Kouris is the CEO of Corporate Relocations Greece; “The relocation industry in Greece has been affected by the general economic crisis for two years now, but it is in the last few months that Greece has experienced the roughest time we have seen in decades and our everyday lives have changed. However, other factors will impact on the immediate future of Greece and on the relocation industry here. The privatisation of large state owned enterprises and land will bring foreign capital and investment into Greece as the airports, electricity supplies and transport networks are sold to the private sector. In the interim, foreign capital, mostly from Russia has already begun to flow to take over failing private companies, factories, touristic land developments as well as investment into northern Greek cities such as Thessaliniki. This trend is expected to increase

especially in terms of development in tourist hotspots, such as Corfu.” Spain is also undergoing a profound change to its social and economic infrastructure. Susana Bourne is the Managing Director of Antares Relocation Spain; “Spain is currently going through one of the bigger crises of its history with an unemployment rate of over 20%. On the 20th November 2011 we anticipated elections, and a new government has been elected and will start in January implementing new reforms. This is something that many Spanish people are waiting for with anticipation, as there will have to be major changes. In our view, the tendency for major Spanish companies, especially in engineering, infrastructure and telecoms, is that instead of investing in Spain, they are going overseas to find new opportunities. This is a big change because historically there were few companies investing overseas, it seems that many more are doing so now and therefore there has been a shift from incoming multinational expatriates to outbound Spanish professionals.” A change in assignment structure was one of the major changes that the relocation companies were seeing first hand. Maria Kristina again; “Multi-nationals and expatriates are a part of Greece’s economy and have been very affected by the current crisis. Assignees relocation support has been reduced as have assignment durations. Assignee departures have increased and companies are not re-filling those expat positions. Over the next two years we expect a further decrease in relocations within existing multi-nationals.” Susana Bourne says the issues facing the Spanish economy are also translating into big changes in assignment types; “While speaking to many international companies recently, it seems that many projects are on hold at least until Q1 2012 to see if they can get an idea of how any reforms that the new government might make will affect them. With regard to those international companies that are still bringing people into Spain, we are noticing that the relocation packages that they come with, are on the whole getting smaller. Previously people had two or three days homefinding and now we are noticing that many only have one day relocation packages just covering basic local registrations. The orientations and settling in seem to have been

cut wherever possible, especially with lower management.” Ireland was the first nation in the Eurozone to get into a debt repayment crisis and provides an interesting model for countries who may be going through this at present. Now a year after the Irish bailout, the austerity measures imposed seem to be having an effect and the outlook is more positive. Chris Wining is CEO of Corporate Care and is based in Cork; “Perhaps unexpectedly, the mood among my clients is actually very upbeat in general. This may be because most of our clients are multi-national companies who export their goods and services and the export market has been performing well recently in Ireland.” The strongest economy in Europe remains Germany and as we have all watched as the debt crisis unfolded for Ireland, Greece Spain and Portugal, economic recovery has hung on the willingness of the German government to continue to prop up the Euro. Though certainly altruistic, these actions are also self-preservationist. Helmut Berg is the CEO of RSB Deutschland, one of the largest mobility companies in the country; “Indicators for the immediate future of the German economy are contradictory. On the one hand the November IFO Index (the most important barometer in Germany for business and business development) shows the economy to be on an uptrend, and the real economy is functioning well. On the other, the European debt situation is very serious and there is huge uncertainty on how this will impact the real economy in 2012. The growth forecast for Germany for the coming year has been set at 1% compared to the expected growth in 2011 of 2.9%. It is unlikely that the decline in 2012 will be as severe as 2009, but there is so much uncertainty about external factors, that confidence is shaky. Other European countries expect no growth at all.” Helmut and his team, monitor economic forecasts closely as this enables them to strategically plan company activities and better anticipate their clients needs. But the uncertainties of sovereign debt and how to handle a single currency with such diverse economies, make planning much more complex; “One of the issues we face in this crisis that makes it different to the sub-prime credit crunch, was that in 2009 we could see a direct cause and effect and this made it Winter  International HR Adviser

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Relocation simpler to come up with defined solutions. This time, we face greater uncertainty in what solutions can be implemented. Take Eurobonds for example; some analysts say they are the key to stability where others say they are a recipe for disaster. This is the problem; no-one knows, as we face issues that have never been seen before. What is certain to me is that this crisis will not take months to be solved – it will take at least 5-8 years for the financial system to realign itself, but we all hope that that painful adjustment maps out a far better way forward for both global markets and national economies. What happens in Italy could be a critical benchmark in assessing where we go from here. An overtly political government has been replaced with specialists in financial and economic theory who have the task of solving the issues without the usual political posturing and the uncertainty that that creates.” One of the issues that arose with almost everyone I spoke with was how innovative they were having to be in terms of service changes to their clients. Portugal has been struggling for some time and although bailouts have hopefully begun to increase confidence and stability, the impact on the mobile workforce has been profound. Isabel Cudell is the Managing Director of Moving On, based in Lisbon; “We are adapting our portfolio to the market, focusing on services that were once considered ad-hoc and have now taken an important role in our business development, such as corporate tenancy management and short-term assignment integrated solutions. The present economic situation is leading Portuguese companies to export and reinforce internationally, which is the reason why we are assisting more and more outbound clients. The service isn’t as profitable as we all know, but it is giving us a chance to work more within our network and industry partners. The global economy demands a mobile workforce and believing that won’t change. These threats should be looked upon as opportunities.” The same factors have encouraged Chris Winning to look at the development of her company in the light of new service requirements; “The mood in the relocation industry in Ireland is very positive – but only for those who have listened to their clients and changed their service offerings to match the clients’ new needs. We have noticed a big change away from the typical ‘ex-pat family’ to more short-term assignments International HR Adviser  Winter

(1-6 months) for single individuals or couples with no kids. This is in fact very good news for us as we get to assist more assignees as they tend to replace one STA with another.” Even France, which has so far been shielded from the worst impact of it’s large sovereign debt, has seen big changes in corporate mobility. Nathalie Gazal is the CEO of Expat Relocation France and on the board of the national mobility association the SNPRM. At their annual conference in November, it was confirmed that the government sponsored MobiliPass will be abolished in 2012. This initiative was set up to encourage domestic relocation through the government paying for professional relocation support. This means that many companies specialising in this type of work may not survive. Nathalie believes that diversification is the key to the future; “French relocation companies which are only living from the “home search” & which did not anticipate the crisis in developing some diversified business such as tailored made packages including intercultural, outbound, tax advising and administrative formalities, will suffer more than those who have stuck with the traditional concierge type services. Regarding our French clients we can feel a kind of nervousness or hesitancy towards the first 2012 trimester, but staying optimistic, I hope that it is only a short passing phase.” Almost everyone I spoke to noted the fact that their countries had all tightened immigration rules to protect domestic jobs, but in most cases these rules, aimed at the sections of the job market struggling the most, blue collar service and administrative posts, are not the ones being filled by the globally mobile workforce and this is a great source of frustration for relocation companies and corporates alike. Nathalie Gazal; "France faces elections and a popular way to win votes is to be seen to be restricting immigration. We see inadequate & inaccurate laws being passed in order to attract French voters, with immigration restrictions as a good example." Susana Bourne is seeing the same trend in Spain; “Immigration is something that many companies have to consider before looking to bringing non-EU citizens into Spain. At the moment all applications are being looked at through a magnifying glass, and they are finding as many reasons as possible to reject them. One of the things that the Authorities are tightening up on a lot is to consider whether there is anyone in Spain

that is currently unemployed who could carry out the work. If this is the case, then they will reject the application. It is therefore very important that we look at every case in detail to ensure that we can cross this barrier in order to get the permits approved. Bringing Nannies over, for example is now almost impossible.” There is a great deal of uncertainty about how the future of the Eurozone will play out, but in terms of mobility the issues seem to be about easing restrictions and cutting costs. This means that the strategic HR manager will be looking even more close at ROI in international assignments, but as many people in this article have pointed out, there are opportunities as well as pitfalls here. Export markets must grow as domestic markets decrease – this is part of the rationale for the French government withdrawing its financial subsidies for domestic relocation. So although there are no answers as yet, only trends, we can see that quality, and talent retention will be the driving forces behind the future of international assignments and diversification to meet client need is the key for mobility facilitators.

Dominic Tidey Operations Manager EuRA PO Box 189 Diss, UK IP22 1PE P: +44 (0) 8700 726 727 F: +44 (0) 1379 641 940 M: +44 (0) 7764 575614 E: dominic@eura-relocation.com W: www.eura-relocation.com

EURA Conference & AGM 2012 Stockholm, Sweden 25th April – 27th April 2012 For full details and online bookings please visit www.eura-relocation.com


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The Recruitment Landscape For 2011 Overall there has been a 22% drop on new vacancies from 2010 to 2011 in the global mobility industry, but only a 2.5% drop on refill positions. The majority of our clients have said that their company’s financial performance is growing, that is to say over 75% that were asked have indicated that to be so. However that growth has not been translated into hires as the companies themselves are remaining cautious because of the financial uncertainties within the global markets. This mirrored the trends in the previous downturn and slack within departments from natural staffing shrinkage i.e. people leaving were, and currently are, being taken up by the remaining staff. Candidates themselves within the industry have also become more cautious about moving over the last year and this is largely down to the uncertainty of the economic climate which has led to considerable caution in the corporate world. This then is a heavy factor when candidates are weighing up their career opportunities. This in turn restricts the amount of candidates available for the vacancies within the market and the quality of available hires to choose from. This will then affect the perception of the clients looking to fill vacancies as they will wait to hire and give them more reason to rely on their existing teams. Recruitment as well as financial decisions is greatly affected by emotional “trends”- the stock market being a prime example of an emotionally driven market as well as the gold prices. The same can be said of the recruitment trends within many of the industries that we serve. The euro and the current problems within the euro zone are being talked about worldwide and watched globally. There are some pockets of markets that are stable or in growth, Canada being one of them. However, our Canadian clients have their eyes firmly fixed on the US market and feel that their market will be governed by the US growth or decline. I was with a client in Africa last week and they are certainly very concerned and are wondering where this will lead and of course what affect it will have globally. There is also a growth in the reluctance for not only from candidates, but for clients, to be relocation shy. The reason for this has been, in part, caused by the difficulty in

the financial markets and the individual’s landscape for 2012 and beyond, is that inability to relocate their housing because clients will become more in tune with of the mortgage borrowing restriction. their staff, thus becoming more inventive Speaking with a President of a large reloand imaginative on staff retention. Seeing cation company in the US this week, they their employees as high value assets and were adamant that they would not look at assessing areas where the employer can any potential hires if they required relocatadd value to the employees working enviing and that this hiring restriction will stand ronment so that their highest value assets, for the foreseeable future. Not only was this their staff, remain in place. an interesting point of view, as they were a As for the recruiter serving the industry relocation company themselves, but their this will mean that they will have to work reasoning was that they had had several bad harder at understanding not only their cliexperiences of late and had now ruled out ents’ needs, and ideology, but that of their any relocating hires. Does this then beg the candidates needs, wants, and the reasons question that the relocation market will sufwhy they want to move their career i.e. fer as their corporate clients will be having become consultative at every level in their the same problems and the hiring managapproach to recruitment and, to be honest, ers will take the same stance and will restrict this is no bad thing in my view. relocating employees to a longer serving Caroline Frostickemployee? Often trends like this grow and Seear have a ripple effect on events and will be Managing Director passed to suppliers over a period of time. Red Recruit Global Overall there has also been a definite caroline@red-group.net effect on our clients’ perception of staff www.redrecruit.com retention and a marked increase in the moves made to retain staff and keep existing staff within their companies not only engaged, but stable Enclosed with the spring issue of International HR Adviser and settled within their magazine, you will find your complimentary copy of The 2012 Expatriate’s Guide to Living in the UK. working environment. Companies have been This annual Guide is in its 10th year of publication and is a handy source of information for your reference, and also for you investing in training, to share with your expatriate employees, as they relocate to the self-development and UK, or prior to their relocation to the UK. career development The Guide offers invaluable information to all nationalities more so in 2011 than in on important matters whilst moving to, or living in the UK the preceding year. This including banking, driving, education, embassies & High then will affect the talCommissions in the UK, expatriate clubs, healthcare, lifestyle ent pool of hires as high management, removals and storage, property, pet transportaquality potential hires tion, relocation, serviced apartments, taxation, travel and useful will be fewer and movenumbers. Whilst you work hard to help your employees move ment within the industo and settle into the UK, a number of their questions may well try will be restricted. An be answered in this Guide. emerging wish to have You can now order bulk copies of the Guide in advance. There is graduate programmes a nominal fee to cover postage & packing, as follows: in place is growing. £10 for up to 15 copies (£15 for overseas) £20 for up to 50 copies (£30 for overseas) This, however, is tem£40 for up to 100 copies (£55 for overseas) pered with the feeling To order your copies please send a cheque (made payable to that graduates train, ‘International HR Adviser’) for the relevant quantities to which attracts considerDamian Porter, International HR Adviser, PO Box 921, Sutton able expense in time and SM1 2WB. Please include the following information: money, and then move • Full name • Company name • Number of copies required on within two years. • Delivery Address • Telephone • Email My own feeling on For further information email damian@internationalhradviser.com the forthcoming global or call +44 (0)1737 551 506 mobility recruitment

The 2012 Expatriate’s Guide to Living in the UK

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talent management

Understanding The True Cost Of Losing Globally Mobile Talent “The relationship between turnover and performance is likely to be the complex result of multiple contingencies and dependent on the institutional, organisational, and market context of firms and on how performance is measured. Despite theoretical ambiguities, however, the preponderance of evidence suggests that total turnover and voluntary turnover are both negatively related to operational performance. (Batt & Colvin, 2011). Losing people hurts. While some level of staff turnover can be good – for example; when poor performers are replaced with higher performers, or when leavers may become future customers or advocates of a business, or when firms can inject new thinking or creativity into long-standing existing teams or units - leavers typically generate costs for an organisation. In some cases the departure of key staff can cause serious or even fatal damage to operations. However, despite the attention paid by firms to tracking turnover and, to a lesser extent, understanding why it may happen, there is much less work being done to truly understand the cost of losing and replacing staff. In fact, given the magnitude of the potential costs involved the lack of focus on this issue is quite astonishing. There have been a number of highly reputable studies assessing staff turnover cost over recent decades. It is now well established within the academic community that turnover represents a significant and very real business issue. In Cascio’s (2006) study, he estimates that on a conservative basis, staff turnover costs incurred by Wal Mart’s Sam’s Club in the US was easily in the region of $600m per year. For Wal-Mart’s competitor Costco, the cost was closer to $200m. This was not an insignificant competitive advantage, and this together with other advantages deriving from a business strategy focusing on people, continues to see Costco experience significantly better business and share price performance over its rival. So how do you get to such extraordinary figures? The staff replacement cost components suggested in a conceptual framework asserted by Tziner & Birati (1996) go some way to explain, and were International HR Adviser  Winter 

categorised as follows: 1. Direct costs to a firm incurred by the replacement process: recruiting, hiring, training, and socialising (or inducting) new employees including time spent by supervisors and coworkers to integrate them; 2. Indirect costs and losses that related to issues arising in production, sales, and the delivery of goods and services to clients and customers; and 3. Financial value of the estimated effect on performance as a result of lower employee engagement arising within the remaining work force following staff turnover. Using these categories, it is easier to understand the myriad costs that make up the true cost of replacing talent. For example, these costs may include: Separation costs such as exit interviews, for example the financial value of both the interviewer’s time and the departing employee’s time; administrative costs incurred in removing an employee from the payroll, termination of benefits, and the return of company equipment; and severance payments i.e. compensation paid to a departing employee. Replacement costs including advertising in the media or the use of recruitment agencies; processing candidate applications and reviewing references; conducting screening interviews; assessing candidates’ compatibility with the vacant job; holding decision making meetings; and medical examinations and orientation activities for the new employee. It may also include payments made for temporary staff needed to cover the role, pending a new permanent hire. Training costs including induction, orientation in corporate guidelines and regulations, norms of conduct and performance, and core organisational values, or attending formal training programmes and participation in on-the-job training activities. Business performance costs from underperformance of remaining workers. For example, from additional stress being placed on existing team members or falls in employee engagement levels resulting from people leaving. Costs can also arise from losing customers or

clients to competitors because of service problems or the additional cost to integrate new hires and get them to a point where they are producing work at required volume and quality levels. In their study, Tziner and Birati calculated that replacement costs amounted to approximately 150% of base salary. Using a more holistic approach to turnover costs, recent academic research has argued that the true total cost of replacing a worker, depending on the level of the job, can vary between 150%-250% of annual base salary paid for that job, excluding lost productivity (Cascio, 2000).

Losing globally mobile talent So what does this mean within an international HR context and what can we say with respect to the loss of an international assignee? Firstly, it is a far from homogenous landscape and there are of course different scenarios that need to be considered. For example, firms may have expatriates in the early or mid stages of an assignment, where their replacement is more likely. Alternatively, they may have expatriates towards the end of assignment, or even a recently repatriated employee who leaves soon after return to the home country. Both these scenarios might represent significant cost but may also not involve direct staff replacement. Despite the lack of research evidence, it is likely that the cost of losing and replacing international assignees in the early to mid cycle of their overseas role will be much higher in absolute terms than for other employees. If an assignee leaves early and needs to be replaced, there are many costs involved in getting a new assignee up and running in new location. However, while many firms have accurate assignment cost evaluators where much of the direct, tangible costs can be identified, there are significant additional costs that are not examined and quantified in any way. For example, some of these include: 1. The cost of total management time in effecting an assignment 2. The payroll cost and disruption to productivity and performance during pre-assignment visits or assignment related training 3. Additional costs relating to mid-


talent management assignment failure and obligations to the individual and his/her family; for example, severance pay, unforeseen tax and social security, or early repatriation costs 4. The cost of backfilling a home country role in creating a new expatriate at short notice i.e. there may in reality be two employee replacements to be effected 5. The loss of competitive advantage where key knowledge workers leave to go to competitors. Using the above categories, it is clear that the likelihood of significant separation and replacement costs resulting from a failed assignment is very high. And while this is pure conjecture, what if they amounted to 100% of the annual total cost of an expatriate leaver? On this basis, it would not take many failed assignments to generate real and significant business costs running to $millions for mid size expatriate populations of a few hundred, where turnover of such individuals was around, say 5%. Of course for very large programmes of many thousand, a 5% turnover of such expatriates may run into hundreds, and the cost magnitude is multiplied accordingly. For example, an assignee population of 5,000 with a 5% attrition rate of early to mid cycle leavers would see 250 assignment failures. If the annual average total assignee cost was US$175,000 and this directly equated to the cost of a replacement, the total annual cost of replacement would be cUS$43.75m. But what about the repatriated staff, who often represent significant turnover for international mobility programmes? Here the intangible costs become a little more difficult to quantify. Expatriates are often key high performing individuals of an organisation and retention of these individuals contributes significantly to a firm’s long- term success. For returning assignees, the loss of new knowledge and expertise while gained internationally is considerable and there is clear evidence that while individuals believe that this differentiates them in terms of professional and personal capability, not enough firms work hard to retain and exploit the investment made in such employees. In fact, many firms are perceived to effectively ignore them. But how do we begin to measure the cost of losing this expertise? What is far clearer is that firms ought to start compiling evidence around the nature and scale of any expatriate attrition issue they have, for both individuals on assignment and for those who have

recently returned. Firms should know how many assignees or repatriated staff they lose, when and where this is happening, and on what basis people leave. Using this data, they should then be estimating the cost of assignment or repatriation failure and understanding how this translates into business cost and any erosion of competitive position. If they are able to do this, it is then likely that additional resources can be brought to bear to work on initiatives that can reduce unnecessary and unwanted international assignee attrition. References An Employment systems approach to turnover: human resource practices, quits, dismissals, and performance Rosemary Batt Alexander J. S. Colvin, Cornell University, Academy of Management Journal2011, Vol. 54, No. 4, 695–717. Cascio, W. F. 2000. Costing human resources: The financial impact of behavior in organizations (4th ed.). Cincinnati, OH: South-Western. Assessing employee turnover costs: a revised approach Aharon Tziner Univetsite de Montreal. Assa Birati Bar-llan University Human Resource Management Review Volume 6, Number 2, 1996. Decency Means More than “Always Low Prices”: A Comparison of Costco to Wal-Mart’s Sam’s Club. Wayne F. Cascio Academy of Management Perspectives 2006. Stuart Woollard, (2010) "Managing talent across a global workforce", Strategic HR Review, Vol. 9 Iss: 5, pp.5 - 10. Stuart Woollard is Director of King’s College London’s Management Learning Board www.kcl.ac.uk/ hrmlb Telephone: +44 (0)20 7848 3313 Email: stuart.woollard@kcl.ac.uk King’s will be running their third International HRM Academy programme on 18,19 & 20 January 2012 (see: http://www.kcl.ac.uk/sspp/ departments/management/learningboard/InternationalHRMAcademy. aspx )

Free Seminars at The 2012 Corporate Relocation Conference & Exhibition Monday 6th February 2012 Hotel Russell, Russell Square, Bloomsbury, London Chaired by Martin Humphrys, Humphrys’ Education Winner of Relocation Personality of the Year 2009

10.30am - Third Culture And Cross-Cultural Kids – Who They Are And How We Can Help! 11.30am - Relocating Successfully 12.30pm - Tax Planning Essentials For Expatriates In The UK 1.30pm - “All You Wanted To Know About Corporate Immigration But Were Afraid To Ask?” 2.30pm - Strategic Partner: The Next Move For Global Mobility 3.30pm - Setting Competitive Expatriate Management Policies: Current Trends And Best Practices Places at these seminars are free, but visitors must pre-register as there is limited availability. To register your free place, please email helen@internationalhradviser.com We look forward to seeing you there!

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serviced apartment

Global Serviced Apartments Industry Report 2011-12 The Apartment Service took the initiative in 2008 to publish the first report in to the demands and supply trends for the Global Serviced Apartments Industry. The second edition, published in 2010, looked at how the industry was coping with recession and also provided a summary of the key global markets for serviced apartment operators. The third and current edition looks at how these trends have evolved over the last three years, and at what apartment operators believe the immediate future holds. It looks at how corporates are using apartments, and in particular at the natural synergy between the relocation market and serviced apartments. It also examines the mechanics of the corporate housing market, long established in the US, but now making ground in Europe. This year's report includes contributions from a dozen experts on their local serviced apartment markets, together with their own researched summary of rates, new market entrants and estimates of total supply by region. This local knowledge brings a new dimension to the Global Serviced Apartments Report, and one which corporate procurement, training and HR functions alike should find invaluable when making informed purchasing decisions. It further sheds light on how the different sectors in the serviced apartment world work and how these sub categories address the wide range of corporate accommodation needs.

Supply & demand Despite the recession and subsequent collapse of worldwide property markets, the global serviced apartments industry continues to expand. In 2010 we estimated that there were 446,996 Extended Stay/Apart-Hotel apartment units in 7,119 locations. Today, we have identified 599,187 units in 8,362 locations - an increase of 34.1% in inventory and 17.5% in coverage. Similarly, corporate housing identified in the US and Canada has risen from 44,469 units in 2010 to 70,557 units in 2011 - an increase of 58% year on year. Although partly attributable to the completion of apartments already in the International HR Adviser  Winter

pipeline before the recession struck, this growth reflects the increasing popularity of serviced apartments with operators and users alike. In the last edition of this report, buyers and operators alike were optimistic about the year ahead, despite hotels in almost every global region reporting reduced occupancies for 2009 compared to the previous year. Our latest figures suggest that this optimism was well-founded, with operators out-performing their hotel counterparts in all key areas. In contrast to hotels' slow recovery from global recession, members of UK's Association of Serviced Apartment Providers (ASAP) have reported substantial growth in the last year.

Demand for serviced apartments Demand for serviced apartments is on the increase, evidenced by the continuing and overriding optimism amongst apartment operators. The relocation industry is placing more short-term assignments (i.e. less than a year) ; business travel has picked up and is seeing more trips of a week or longer; and multi-cultural societies are travelling further and longer to spend time with friends and relatives. These disparate forces are all driving demand.

Global Industry Overview Definitions - corporate housing vs. extended stay: The term ‘serviced apartment’ is traditionally used to describe an apartment alternative to hotel accommodation for long stay leisure or business travellers. However there are two types of accommodation to which the description serviced apartment applies, with an ever-growing list of sub-categories. 1. Extended stay hotels - mainly studios, one bedroom with a few two bedroom apartments typically found in urban locations, ranging in standard from budget to deluxe. All are fully furnished and include • En-suite bathrooms • Fitted kitchen or kitchenette • Lounge/dining area sometimes including a sofa bed or pull down bed

• Working area, desk, office chair, internet access & direct telephone line. The hotel services usually available from extended stay hotels include • Reception desks – some manned 24hrs, others on limited hours (e.g. Travelodge), or none at all • Daily or weekly cleaning, and laundry service. (Most properties have either shared laundry facility or an in-apartment washing machine). There are typically no restaurants, bar or lounge areas, although the level of services is generally higher than those found in hybrids Apart-hotels or Apartotels, which are usually a leisure or resort based product, and also come in standards of accommodation and range of services from budget to deluxe. 2. Corporate housing - residential apartments up-graded for stays of 30 days or more and packaged together with services such as:• Weekly cleaning • Utility charges • Local taxes • Telephone and TV • Guest services - telephone support for maintenance etc. This type of product - also referred to as suite living, residence living and condotel - works as company apartments for either regular visitors or those on extended projects. There are two types of corporate housing:• Apartments rented and maintained by the operator on an on–going basis • Those rented specifically for a particular housing requirement and length of time, after which they are handed back to the owner. This is also referred to as virtual housing. Serviced apartments are becoming a more and more integral part of Corporate Accommodation Programmes. This is being driven by greater consistency of product, although there is still a lot of work to be done in this area. “People not used to them can have some preconceived ideas about the level of services provided” says one buyer. Hotel groups’ expansion in to extended stay products is another factor in driving adoption, brand recognition making users and agents more receptive to their products.


serviced apartment Regional Overview

Report Conclusions

For the third report into the Global Serviced Apartments Industry, we have interviewed a number of experts from across the world to get their views on the state of the sector in their region. This has uncovered some interesting figures, such as “serviced apartments make up 25% of all temporary accommodation demand in Australia” and stories of development possibilities due to the “new travellers” from China. In Europe the supply of serviced apartments continues to grow and there is a constant education going on for (corporate) clients to start adopting serviced apartments in their travel programmes. And there are other challenges too: “Awareness of the service needs to grow and we need to be clearer to all parties in what is on offer”. “We need to self-regulate, creating standards and using consistent terminology for example.” In the USA, the largest market for corporate housing and extended stay properties, the recovery is slow from the recent recession. Operators are cautious to take on more properties and in some key markets such as New York, availability is scarce.

“In 10 years’ time, when The Apartment Service reaches its 40th birthday, commentators will regard the recession of 2008/10 as a milestone in the development of the global serviced apartments industry”, says Charles McCrow – MD of The Apartment Service. “I believe that the serviced apartments sector will gain a significant share of the global lodging market over the next decade and that this success will be driven by factors such as: • Greater consumer awareness of the product of serviced apartments • A more detailed knowledge of apartments´ facilities, pricing and benefits • Greater international mobility demanded by quickening global integration. Furthermore it is important that the whole sector speaks with one voice and that standardised codes of conduct and guidelines for all operator member are developed and adhered to, which will greatly help to grow the sector. To order a hard copy of the report (limited availability), please email Bard Vos bardv@apartment.co.uk

Started in 1981, The Apartment Service was one of the first companies to create a global network of corporate serviced apartments and today we are the largest European booking agent for serviced apartments offering flexible and bespoke solutions worldwide to clients requiring an efficient cost effective solution to their temporary accommodation requirements. Our more than 30 years of experience has given us invaluable insight and knowledge about the serviced apartment industry and as a result we are able to offer our clients an extensive one stop accommodation service which is delivered through. Telephone: +44-(0)20-8944 1444 E-mail: res@apartment.co.uk Website: www.apartmentservice.com Visit us at The 2012 Corporate Relocation Conference & Exhibition at Hotel Russell, Russell Square, London on Monday 6th February

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Strategic Moves - A New Direction For Global Mobility Companies need to be both strategic and nimble in order to survive and prosper in an increasingly competitive New World, buffeted by fluctuating fortunes in mature markets and rapid but inconsistent growth in emerging markets. The war for talent remains a key barrier to growth and organisations need to plan to develop their top talent giving them relevant global experience, but at the same time they need to be able to move quickly to get the right people, in the right place, when opportunities arise. Companies that adopt a strategic approach to global mobility are more likely to take advantage of the opportunities for growth because their expertise and leadership is focused in the right geographies, products and sectors. In this, our first Strategic Moves survey, we have asked companies to rate their approach to global mobility and to comment on the importance of mobility to their strategic business and talent objectives. We have also sought to explore whether their mobility function is aligned to their business and which critical issues it should address. Deloitte surveyed over 140 organisations across the globe from a broad array of industries in order to understand the challenges they faced in managing global mobility. Participants represented major regions, evenly balanced across AsiaPacific, Europe, North America and South America, as well as an even split between responses from HR and those from business lines. More than a quarter of companies that took part have an annual turnover of over $10bn, with an aggregate of at least 30,000 global assignments. Following collation of the survey results, initial themes were developed and these findings were validated with input from major multinational organisations through in-depth discussions. This process enabled us to verify themes and to develop the background arguments in more detail. We have also used our experience working with multinational organisations to inform the commentary. In the report we have set out the findings from the survey and interviews in more detail, illustrating the strategic priorities, the talent issues and the effectiveness International HR Adviser  Winter

of global mobility. Within these we have sought to address some of the challenges, complexities and responses which we would expect companies to encounter. At a high level the survey makes it clear that the global mobility of human capital will become increasingly important over the next three to five years due to the complexity of doing business on a global scale and the increasing importance of emerging markets. HR leaders and senior business executives agree that, more than ever, global mobility needs to become further integrated into core HR processes and act as a strategic partner to the business – complementing the company’s strategic business objectives and its talent agenda. Three key themes common across all survey participants emerged:

1) The importance of a global mobility strategy The findings show that global mobility is an increasingly important strategic enabler which should align to core business objectives. Three quarters of participating companies anticipate that the total number of globally mobile employees will increase or increase significantly over the next three to five years and over 80% of organisations anticipate that global mobility will become more important or significantly important over the same period. The overwhelming majority of respondents (88%) feel it is important or critically important to align their organisation’s global mobility strategy with their business strategy, with nearly half of all organisations surveyed agreeing that their top strategic business issue is emerging geographical markets. These figures are complemented by the Deloitte CFO Survey: 2011 Q3 Results which highlight that growth continues to dominate the agenda of CFOs around the world, with the majority sighting overseas expansion as a key business priority. In reality however, there is a significant disconnect with only 2% of participants believing that mobility is currently aligned to these objectives. The increasing importance of global mobility programmes emphasises the need to establish a formal global mobility

strategy. Moving global mobility to this next level will require careful planning, focused investments, and the development of new advanced capabilities. Global mobility is a significant investment – one that can easily top $25-30million per 100 assignees. At these costs, businesses need to know that they are focusing their efforts on critical priorities and getting a return on their investment.

2) The need to integrate mobility and talent Developing new leaders and providing them with experience to grow new markets is crucial, however the current lack of integration with talent programmes and strategies means that many organisations will not be able to fill their talent pipelines with the global leaders required for future growth. The survey results show that 60% of respondents feel global mobility is important or critically important to meeting their talent agenda. A further 37% feel that it is becoming more important. This illustrates that there is a growing recognition that getting the right people in the right place at the right time is important to the business both in immediate terms, and in relation to talent development. Global leadership and pipeline was selected by a third of respondents as the global mobility issue most critical to their organisations’ successes. However, surprisingly only 11% feel this issue is fully supported by their current mobility programme. Supporting organisational business needs means supporting the overall talent and mobility agenda of the organisation. This requires understanding the broad business and talent objectives and assisting in the integration of international experience in global competency development so they can have the right people, in the right jobs, in the right locations.

3) Enhancing the value of global mobility The survey findings reflect our understanding of the challenges facing chief executives and HR leaders. Global mobility functions have grown reactively, with responsibilities often split by Talent, Operations, HR Shared Service Centres


SURVEY and disparate pockets of mobility expertise with no overall strategic direction or realisation that global mobility can enable many of an organisation’s business objectives. Approximately 40% of survey participants believe their global mobility programme needs significant or radical improvement. A further 36% feel that their programme is adequate, with room for improvement. In total therefore, three quarters of the organisations that participated in this survey rated their mobility function as no better than adequate. Greater significance can be placed on the fact that nearly half of the business executives (outside HR) consider their mobility to be underperforming and not fulfilling the business and talent requirements compared to only 33% of HR respondents. This is the clearest indication that there is a significant disconnect between the perception of those within HR and those within the business in terms of whether global mobility is fit for purpose.

Closing the gap The transition from global mobility being viewed as a transactional cost centre to a value-add strategic partner is a difficult one. Less than 10% of participants feel that their organisation currently perceives global mobility as a fully strategic function. The findings reflect our understanding of the challenges facing chief executives and HR leaders. The development of strategic expertise within global mobility functions will be an important way for companies to address the challenges ahead. This will enable companies to ensure that their mobility strategy aligns with their business and talent objectives, and will also enable global mobility to deliver a more cost-effective and targeted service.

Global mobility alignment In our view, world-class mobility programmes should focus on all three of these themes simultaneously (and flex with talent and business needs) to realign mobility with their organisation’s wider business and talent objectives: Key findings from the survey • Nearly 50% of all organisations surveyed agree that their top strategic business issue is ‘emerging geographical markets’ • Behind emerging geographies, ‘globalisation’ is listed as one of the top three strategic business issues by 20% of participants, and ‘competition’ follows close behind • Three quarters of participating companies

anticipate that the total number of globally mobile employees will increase or increase significantly over the next three to five years • Nearly 80% of organisations anticipate that global mobility will become more important or significantly more important over the same period • The overwhelming majority of respondents (88%) feel that it is important or critically important to align their organisation’s global mobility strategy with its business and talent objectives. Only a handful of participants (2%) however feel that there is complete alignment at present • The percentage of global assignments initiated for strategic or leadership reasons is increasing • 31% of respondents rate global leadership development and pipeline as the global mobility issue most critical to their organisation’s success. Only 11% think this issue is fully supported by their current mobility programme • Only 34% of respondents believe that senior executives understand the role of global mobility in their organisation. In addition, only 37% of respondents believe that senior executives highly value or value the role of global mobility in their organisation • Approximately 40% of survey participants feel that their global mobility programme needs significant or radical improvement. A further 36% feel that their programme is adequate, with room for improvement. In total therefore, three quarters of organisations that participated in this survey rated

their mobility function as no better than adequate • Nearly 50% of the business executives (outside HR) feel that mobility is underperforming and not fulfilling the business and talent requirements compared to only a third of HR respondents • Less than 10% of participants feel that their organisation currently perceives global mobility as a fully strategic function.

Chapter 1: The strategic priorities Importance of mobility Our research confirms that global mobility is a strategic business priority. Three quarters of participating companies anticipate that the total number of globally mobile employees will increase or increase significantly over the next three to five years. Alongside the increase in basic volumes comes an escalation in the importance of mobility to the organisation. Nearly 80% of organisations anticipate that global mobility will become more important or significantly more important over the same period. The increasing importance of the mobility function is a reflection of the role that assignments, transfers and moves have in helping companies meet their strategic objectives. This includes permanent transfers, local hires and global nomads, as well as more traditional long and shortterm assignees. The results also highlight that the greatest expectation and reliance of mobile talent comes from the largest multinationals, with turnover of more than $10bn. There is also an increasingly strategic Winter  International HR Adviser

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Figure 1. How do you anticipate the total number of global assignments (or mobile employment such as permanent transfers local hires, global nomads) in your organisation will change in the next three to five years?

Figure 2. Of your organisation’s global assignments, what % are anticipated to be initiatiated for strategic or leadership development in the next three to five years? (by annual turnover)

Figure 3. How will the importance of global mobility change in the next three-five years? (by region)

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focus on the moves themselves. Business pressures such as rapid growth in the emerging markets, globalisation and competition have forced companies to reassess their use of mobility as a tool simply for stop-gap resourcing towards a more thought-out approach. The immediate role that top talent are taking in developing new business is reflected in the fact that companies anticipate changes in the proportion of moves that are strategic in nature. We asked companies to estimate the proportion of their global assignments falling in to four categories: Experience, employee initiated, knowledge transfer or strategic talent/leadership development. Our results indicate that the majority of companies currently use global mobility as a means to support a resource gap or transfer knowledge and this trend will decrease over the next 3-5 years. At the same time however, our results also indicate that around 26% of current moves are initiated specifically for strategic talent or leadership development but there is also an expectation that this will increase over the next three to five years. This highlights that multinationals already recognise the importance of strategic global deployment, even if they have not yet implemented new models. Within the responses there is a secondary alignment to turnover. Larger multinationals are more strategic in their use of mobile employees and assignments than smaller companies. Those with turnover of more than $10bn have the highest proportion of strategic moves. Moreover, there is a broad correlation between turnover and proportion of strategic moves, with reducing turnover equating to a reducing strategic focus. From this we can see that the most successful companies are those that prioritise strategic deployment of resources. From a global mobility standpoint this is a significant finding, however it is important to recognise that knowledge transfer, basic resourcing and movement of expertise between markets will always be a key component of mobility, despite the fact that companies are focused on the top talent at present. In fact, these kinds of moves still represent the largest proportion of mobile employees now and in the next 3-5 years as previously stated. Organisations operating in highly specialised technical areas are increasingly reliant on mobile expertise. This is more costeffective than employing technical specialists in all geographies, and also allows


SURVEY consistent ways of working and culture to be embedded across the organisation. Recognition of the importance of knowledge transfer and expertise also ensures that companies have a holistic approach to mobility. The top talent and the development assignments may be of a higher profile and make use of international workforce planning, global employment companies or similar structures but it is also possible to approach knowledge transfer and expertise in a more strategic manner. Some global companies are moving to a model of international workforce planning for all assignment types, matching requirements to experience on a global basis.

Alignment of mobility to the business We asked respondents how important it is to align their global mobility strategy with the organisation’s business objectives and the overwhelming majority (88%) felt it was important or critically important to do so. Conversely, there is a huge disconnect as only 2% of business and HR executives reported that global mobility is currently completely aligned to their organisation’s strategic business objectives. There is also a noticeable split based on the background of the respondents, with those from a non HR background twice as likely as those from HR to feel that there is no alignment at all. This points to a gap between HR and the business when it comes to the question of aligning global mobility to the business objectives.

Figure 4. To what extent is global mobility currently aligned to your organisation’s strategic business objectives?

Emerging geographies Faced with a list of seven alternative issues, nearly 50% of all organisations surveyed agreed that their top strategic business issue is ‘emerging geographical markets’. Maximising the opportunity in emerging markets can only be done with

Figure 5. What is the most important strategic business issues in terms of their importance to your organisation’s management today?

the right talent, expertise and ways of doing business. International deployment of resources is a key concern for multinational organisations and the rise of emerging economies and new markets has led to a change in the way organisations need to manage their resources globally. Many organisations have not had time to develop local talent in these markets so they need to be able to move people from mature markets at the same time as building up their talent locally. This presents a challenge because it can be difficult to facilitate movement, especially in the face of no guarantees of a right to return in the home country. The difficulties arise in identifying, incentivising and moving the right people without spiralling additional cost. Behind emerging geographies, ‘globalisation’ and ‘competition’ were also stated as top strategic business issues. In order to thrive in the increasingly competitive global marketplace businesses need to ensure that future leaders have experience outside their home market and develop a global mindset. This means that as well as moving today’s top talent in to emerging markets to drive new business, companies are trying to provide tomorrow’s leaders with the right global experience, wherever they might come from. The nearest alternative issue was advances in technology which only gathered ten percent. This overwhelming result has reinforced our understanding that movement of people, skills, knowledge and culture to emerging markets is driving a more strategic approach to global mobility.

Deloitte’s point of view: The importance of a global mobility strategy The increasing importance of the global mobility function within organisations reinforces the need to establish a clear global mobility strategy. If managed well, it can

create far more value for a business. In our experience, effective global mobility requires a formal strategy that focuses on a company’s long term business needs and global talent priorities rather than simply reacting to individual opportunities as they arise. Although many organisations spend substantial sums on international assignments, these investments are often made on an adhoc basis to fill short-term needs rather than with a view to the enterprise’s strategic business and talent priorities. A global mobility and workforce strategy that establishes objectives and guidelines for the company’s global mobility efforts can help leaders make informed decisions about how to focus their investments and reap the desired returns, both in the short and the long-term. In our view, an effective global mobility and workforce strategy should: • Identify which business objectives should be supported by global mobility (for example, development of capabilities in strategic growth markets, or accelerated development of management bench strength). • Identify the talent objectives supported by global mobility (who should go on international assignments, why, how are they selected?). • Identify roles and career paths for which international assignments are important to development. • Identify job families and employee types that should be prioritised for mobility. • Identify preferred source and destination countries for global deployments. • Define a multi-year plan and budget for mobility (at both the organisational and divisional levels). • Define measures of success for the global mobility programme (e.g. anticipated talent outcomes, contribution to business results). An effective global mobility and workforce Winter  International HR Adviser

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Figure 6. To what extent is your global talent programme currently aligned to your organisation's strategic business objectives? (by job function)

strategy fosters a portfolio view of the cost and impact of mobility on the business, and offers a clear business rationale for specific mobility investments. In addition, it provides the basis for a principles-based framework that can help business leaders make smart decisions that align with the organisation’s larger business and talent needs. For example, a company might use its global mobility and workforce strategy to develop a decision guide to help business leaders determine which positions are best filled through the global mobility programme, and which employees are best suited for particular assignments. Furthermore, an understanding of the core business drivers will ensure that the policy and processes are tailored appropriately. For instance, if expansion in the emerging markets is a core business strategy, global mobility can facilitate the movement of talent. The global mobility policy may be designed to include additional compensation or allowances to motivate assignees to go on assignment to these geographies, or in high growth countries remain with the organisation. Likewise, a central budget/alternative cost-sharing approach may be used to encourage host locations to utilise international assignees (rather than pick up the inflated expatriate costs themselves).

Chapter 2: Talent and global mobility There is a clear connection between the people issues faced by organisations and International HR Adviser  Winter

its strategic business issues. Our survey found many organisations are clearly anticipating a growing emphasis on talent and mobility strategies aimed at more effectively recruiting, connecting, and managing a global workforce. Facing a more global marketplace, companies are now placing a high priority in searching for talent in global and emerging markets so they can have the right people, in the right jobs, in the right locations. Many executives recognise that the once emerging markets of the pre-recession days have become the catalyst for future growth, placing tremendous demands on talent managers to get new people in new jobs at new locations. As a result, organisations have realised that they must have a sharper focus on global mobility and talent management; they have recognised the need to recruit hard-to-find skill sets; and programmes to create career paths and challenging opportunities to retain key employees.

Talent alignment In view of these challenges, the survey asked respondents to gauge how well their global talent programme is aligned to the strategic business objectives. Less than 33% feel that their talent programme is more than moderately aligned, and this is particularly the case for companies with turnover of less than $1bn. Concerns over lack of alignment extend to the relationship between the talent agenda and global mobility, where only 21% feel that there

Figure 7. How important is global mobility to your organisation's talent agenda? (by function)

is more than moderate alignment. Nearly 40% believe that there is slight alignment at best. Given the increasing importance of strategic moves required to fulfil business objectives this gap will clearly have to close in future. Whilst there is a clear disconnect between talent and mobility and the strategic business objectives, organisations recognise the importance of global mobility in fulfilling talent objectives. 60% of respondents feel that global mobility is important or critically important to meeting the talent agenda. A further 37% feel that it is becoming more important. This illustrates that there is a growing recognition that getting the right people, in the right place, at the right time is important to the business both in immediate terms, and in relation to talent development. In practice, businesses may have the elements and desire necessary to create the linkage, but no guiding framework or mechanism to bring the parts together to work for the whole. Building these linkages requires treating the entire mobility and talent process – from strategy to solutions – as one system. No single element can flourish on its own. It’s the interaction between them that gives the system its


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Figure 8. Which global mobility issues are the most critical to your organisation’s success?

vitality and robustness. This takes work, however, once the parts of the system start to work together, the mobility and talent development process becomes focused, self-sustaining and often more efficient. As a result, the employees that the organisation needs now and in the future will begin to emerge.

Leadership development The second clear theme from our survey centred on leadership development, retention and performance. In these areas mobility has a key role in global organisations. Future leaders of global companies will need to have experience across multiple jurisdictions and therefore going on assignment or transferring to a second location has become an obligatory requirement of many talent pipelines. Likewise, assignments, rotations and transfers are being used by organisations to facilitate better levels of retention and motivation. Finally, utilising employees from around the globe is an excellent way of developing a high performance culture, and is used by many companies as a way of establishing a global mindset. A third of respondents view global leadership and pipeline as the global mobility issue most critical to their organisation’s success. However surprisingly only 11% feel this issue is fully supported by their current mobility programme. This finding also supports our hypothesis outlined earlier that mobility is increasingly seen as a strategic part of international HR management. As a result, mobility should address both business-driven needs and talent-driven opportunities to identify top candidates and find the right jobs to develop their competencies. A talent-based mobility framework requires thoughtful mobility policies that support different combinations of job types and

people profiles. Such an approach can help organisations make wiser investments in mobility.

Deloitte’s point of view: Realigning global mobility to talent To effectively address today's mobility and talent challenges, organisations must realign global mobility so that it balances the needs of the three talent constituencies: employees, lines of business, and the organisation as a whole. One key to better serving employees is to identify those with high potential who can benefit from development and mobility, and then fit jobs to them. To support the lines of business, global mobility must understand business growth objectives and opportunities, assist

in the development of staffing strategies, and implement policies and programmes to help the business extract maximum value from mobility investments. To do this, global mobility must understand what the organisation's strategic geographic markets will be in the years ahead, be ready and able to help deploy people into those markets, and provide consultation on associated HR issues. In short, supporting organisational business needs means supporting the overall talent and mobility agenda of the organisation. This requires understanding the broad business and talent objectives and assisting in the integration of international experience in global competency development so they can have the right people, in the right jobs, in the right locations. From a leadership development perspective, people learn primarily through experience. But seldom do organisations have the systems, tools and culture needed to create the kinds of stretch assignments and other developmental experiences that facilitate real growth. Networking, formal learning and technology-assisted development are all critical – but they must be designed around those experiences if they are to achieve their full power. Leading organisations are re-evaluating their mobility and talent programmes to consider some of the following questions: • How can we rethink our current mobility polices so that they are capitalising on

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SURVEY experiential development opportunities? • Do our mobility policies encourage and systematise “smart moves” that meet current business and future development needs? • Do we manage our assignees by giving them ‘good’ feedback during and after assignments and planning their next roles? • How will we operationalise the new system? Mobility should address both businessdriven needs and talent-driven opportunities to identify top candidates and find the right jobs to develop their competencies. A talent-based mobility framework requires thoughtful mobility policies that support different combinations of job types and people profiles. Such an approach can help organisations make wiser investments in mobility. Organisations should identify talent they are willing to invest in, develop policies to govern talent-driven deployments, and match people to opportunities that will help them reach their potential.

Chapter 3: Global mobility effectiveness Assessment of the mobility function From an examination of the strategic imperatives and the people challenges that global companies face, it is clear that global mobility should play a key role as a strategic business partner. The focus of global mobility functions varies hugely between organisations. Many perform a transactional, administrative function getting individuals from A to B. These departments tend to have neither documented processes nor value driven policy frameworks. Some global mobility functions are more strategically-focused reporting to the head of talent, and engaging with the business. In the survey, we asked respondents to assess the overall position of the global mobility programme within their organisation. 40% feel that their global mobility programme needs significant or radical improvement. A further 36% feel that their programme is adequate, with room for improvement. In total therefore, three quarters of organisations that participated in the survey rate their mobility as no better than adequate. Nearly half of the business executives (outside HR) consider their mobility to be underperforming and not fulfilling the business and talent requirements compared to only a third of HR respondents. This is the clearest indication that there is a significant disconnect between the perception of those International HR Adviser  Winter

Figure 9. What statement best describes your organisation’s global mobility programme? (by region)

within HR and those within the business in terms of whether global mobility is fit for purpose.

Valuing the role of global mobility Equally concerning, only 34% of respondents believe that senior executives understand the role of global mobility in their organisation. In addition, only 37% of respondents believe that senior executives highly value or value the role of global mobility in their organisation. Given the importance of global mobility as highlighted in the results under chapter 1, these results should give chief executives and HR leaders the remit to undertake a review of the status quo. They also emphasise the need for the global mobility function to have a clear strategy and role in the organisation which is communicated and marketed effectively within the business to all core stakeholders. This will allow the business to fully understand the role of global mobility and view the function as a strategic business partner rather than an “engine” which simply moves an employee from one country to another. In our experience, organisations which have a clear global leadership focus and support for the mobility programme are the ones which are able to engage in strategic discussions and deliver mobility most effectively. The fact that so many organisations require significant or radical improvement to their global mobility programme may be the result of a lack of clear direction from leadership and executives. Without the cultural impetus from top executives, issues such as repatriation, cost control, compliance and delivery are more likely to lead to an ineffective global mobility function. Those surveyed do not believe that senior executives value the contribution of global mobility to the organisation. Conversely, the survey responses reveal

that more than 80% of respondents feel that their senior executives would rate their mobility experience as good or excellent. This is encouraging, and a little surprising given the ‘noise’ which HR are often subjected to from assignees. The complexities of global mobility are enormous, incorporating issues in relation to selection, relocation, payroll, tax, promotion and repatriation (to name a few), but doing so within multiple jurisdictions with input from multiple stakeholders. Basic operations are mostly carried out during periods of high stress and emotion for the employees themselves, and HR business partners often face the brunt of complaints. Given the complexity of mobility many organisations are investing in improving processes, policies, controls and governance structures so that the basic tasks can be managed more effectively. Creating a more effective global mobility function relies on integration with wider HR strategies and a clear delineation of responsibilities. For many organisations this will mean utilising the Ulrich model, including centres of excellence, shared services and HR business partners. This creates a challenge for mobility teams because their work crosses all areas. Understanding how the interactions work and where strategic mobility advice can add value is key to improving the mobility function and allowing it to meet the needs of the business.

Deloitte’s point of view: Enhancing the value of global mobility As organisations place more value on global assignments, the global mobility function and programme needs to shift from being an administration function (and being seen as one) to a function which is recognised as a business partner, focusing on deploying global talent more


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Figure 10. To what extent do you feel your organisation perceives global mobility as a strategic/valueadding function versus a cost centre/admin function today? (1 = Strategic/value-adding function and 5 = Cost centre/admin function)

strategically and helping the company make smarter moves. We believe that an effective global mobility programme should be able to support the business and assignees with high-quality service that is costeffective, consistent, and easy to use, manage, and administer. The purpose of global mobility service delivery is both to help businesses make smart assignment decisions, and to help assignees with their moves. In particular, we believe effective service delivery should: • Provide guidance to businesses on mobility-related decisions, such as: estimating the cost and developing the business case for particular assignments; selecting assignment goals and developing related metrics; helping managers evaluate candidates for assignment opportunities; advising managers on policy selection and assignment duration • Deliver the entire spectrum of HR services to assignees, such as: coordinating physical moves; assisting with tax and other compliance issues; assisting assignees and their families with acculturation and integration; delivering basic HR services (e.g. reimbursement, payroll, benefits administration) during an assignee’s time abroad • Integrate global mobility and talent management practices so assignees are appropriately deployed to suitable positions when they return to their home country (or are reassigned to another country) • Utilise both internal resources and external service providers as needed to deliver cost effective, high-quality service. In addition, we believe companies should strive to offer both mobile and nonmobile employees (and their

managers) a service experience that is as consistent as possible. Organisations can take significant steps toward achieving this consistency by integrating certain aspects of global mobility service delivery into the company’s HR operations and infrastructure. Deloitte’s roadmap above indicates key steps involved in the design of a global mobility programme which is fully aligned to the business and talent drivers. This approach involves key stakeholders throughout the optimisation journey in order to manage the change and gain buy in at each stage.

Chapter 4: Closing the gaps The transition from global mobility being viewed as a transactional cost centre to a value-add strategic partner is a difficult

one. Less than 10% of participants feel that their organisation currently perceives global mobility as a fully strategic function. These results do not compare favourably with other areas within strategic HR such as talent and development. However, when asked to think about the next 3-5 years, 94% feel that the perception of global mobility as a strategic or valueadding function would either increase or remain the same. This journey may prove to be difficult unless HR and leadership are committed to the project in terms of communication, resourcing and support. The findings from the survey raise a number of questions about the future of the global mobility function, its interaction with strategic HR and the importance of global mobility in supporting business strategy.

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SURVEY All businesses have different strategies, however our survey indicates that the movement of talent between countries is becoming increasingly important and a strategic consideration for global companies. Although not all companies will want to concentrate on development of future talent or nurturing a global culture, there should always be a strategic element to global mobility with clear strategies/goals. At the very least, moves should be evaluated against a policy framework to ensure that reward is targeted at the right individuals. The survey raises a few important questions which chief executives and HR leaders should consider: 1) How mature is our global mobility programme? 2) Does our approach to global mobility support our business objectives and how is this managed? 3) How is global mobility perceived and valued within our organisation? 4) Given its rising importance, what are we doing to improve the performance of global mobility (including the policy, processes and structure)? 5) What is the role of our global mobility function in strategic and operational terms? 6) Have we reviewed our structures to ensure the most effective approach to mobility?

For further information please contact: Robert Hodkinson, Partner, Deloitte LLP Telephone: +44 207 007 1832 EMAIL: rhodkinson@deloitte.co.uk Copies can be accessed from the website www.deloitte.co.uk

Figure 11. Regional participation

Figure 12. Annual revenue Figure 13. Participant title

About the survey The Strategic Moves survey was coordinated by Deloitte in the UK, in collaboration with over 20 Deloitte member firms worldwide. Data was collected in the form of an online survey as well as various in-depth interviews. Participants in the research include 141 HR and non-HR executives, 60% of which identify their main functional role as Human Resources whilst the remaining 40% are self-identified as corporate executives outside the HR function. Of the 60% who reported their main functional role as Human Resources, 36% of job titles are Head of Global Mobility, whilst 23% are HR Directors. Notably however, no one identified themselves as Head of Talent. Participants represent major regions across the globe, evenly spread across North America, Latin America, Asia Pacific and Western Europe. A broad variety of industries are covered by the responses, with a large representation in IT and Technology, Energy and Natural Resources, Manufacturing and Professional Services. More than a quarter of companies that took part have an annual turnover of over $10 billion. International HR Adviser  Winter

Figure 14. Participant function

Figure 15. Industry representation


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diary dates JANUARY 2012 Deloitte Employment Tax Academy 16th January 2012 09.30 to 16.00, London, UK Deloitte is offering an employment tax training programme, aimed at those working in payroll, employment tax and reward. Our first training session will take place in January, at the Deloitte offices in central London and is the first in a series of classroom based modules which will provide the participant with up-to-date knowledge from Deloitte professionals, on the practical aspects of day to day employee tax matters. The cost is £750 +VAT per module, which includes the full day’s training and take away materials, to allow the participant to build a portfolio over the course of the training programme. This Intermediate level training will form part of a wider programme of training solutions being launched by Deloitte, via its Employment Tax Academy. For further information on this event please contact Ashleigh Gatward at agatward@deloitte.co.uk or on +44 20 7303 8115. BDO and CIPP Seminar – Real-Time Information – The Strategic Issues To Consider in 2012 17th January 2012, 8am – 10am, 55 Baker Street, London W1U 7EU PAYE has been the system for the deduction of tax/National Insurance since its introduction back in 1944 but HMRC are now creating significant changes to the way that all payroll related deductions are reported. Currently employers submit a year end return once a year - under RTI employers and pension providers are required to inform HMRC about deductions when payments are made not just at year end. Reporting for benefits is not being altered at this time but is expected to in the future. The changes will impact across number of systems/procedures and noncompliance will adversely affect your wider relationship with HMRC. So to help you get your business prepared, we're co-hosting a breakfast seminar with the CIPP where we will be welcoming guest speaker Maggie Anderson, HMRC's RTI Policy Adviser. Designed for Finance Directors, Human Resources Directors and senior Payroll Managers, we will highlight the wider strategic issues of RTI for your organisation that need addressing now, rather than waiting until introduction in 2013. Please email Shamim Pickles to register: shamim.pickles@bdo.co.uk Gain A Global Talent Advantage: International HRM Academy at King’s College London 18, 19 & 20 January 2012 King’s College London, UK Globalisation drives significant international business challenges, many of which arise in managing complex, cross border workforces. King’s International Human Resources Academy (IHRMA) helps organisations address these strategic international business issues. You work alongside a diverse group of like-minded professionals and will get comprehensive teaching and insight from leading academics, industry experts and respected practitioners; covering issues such as trends in resourcing global firms, globalisation and the role of management, cross cultural business challenges, developing a global employer brand, talent management, and international workforce risk. Download the brochure at www.kcl.ac.uk/hrmlb and if you would like to register or need more information contact stuart.woollard@kcl.ac.uk

FEBRUARY 2012 The Corporate Relocation Conference & Exhibition 6th February 2012, Hotel Russell, 1-8 Russell Square, London, UK This is the 15th annual conference and the seminars cover useful and International HR Adviser  Winter 

informative topics relevant to International HR professionals. Please visit the ‘Free Conference & Exhibition for IHR professionals’ section on www.internationalhradviser.co.uk. Please contact Helen Elliott on +44(0)20 8661 0186 or email: Helen@internationalhradviser.com for further information. Global Workforce Summit: Talent Mobility in EMEA February 21-22, 2012 Hilton London Metropole, London UK Join other gifted professionals to examine the new wave of change moving through EMEA talent mobility issues and find some exciting solutions in just two days of networking and benchmarking! Visit the Events section on www.worldwideerc.org and register for this exceptional programme.

MARCH 2012 Global Workforce Summit: Talent Mobility in APAC March 22-23, 2012 Shanghai, China Talent mobility is a crucial strategy for organisations seeking to prosper in today's dynamic Asia-Pacific region. Connect with subject-matter experts for benchmarking, advice, suggestions, and services; and learn best practices for recruiting and placing skilled talent in APAC. Email webmaster@worldwideerc.org to be notified when registration opens or visit www.worldwideerc.org for further information.

APRIL 2012 EuRA Conference and AGM 2012 25th April - 27th April 2012, Clarion Hotel Sign, Stockholm Our 15th International Relocation Congress will take place in Stockholm, one of the most beautiful cities in the world and the selfbranded capital of Scandinavia. Our programme “Discover, Consider, Deliver” will look at how best we can service the needs of our clients; GRMC’s, corporate HR and the transferee. With increased pressure on fees and ever greater demands for service excellence, we will also examine how to continue to diversify and grow in challenging times. Full details and online bookings are on the EuRA website at www.eura-relocation.com

MAY 2012 The London Totally Expat Show 2012 Europe 14th May 2012 The Business Design Centre, Islington, London, UK This innovative event is designed with the corporate HR attendee in mind: it offers free entry to all HR professionals, a comprehensive exhibition of respected suppliers, and free educational seminars based on case-studies of real programmes, all set in a welcoming and lively environment. Anyone who is anyone in Global Mobility will be at this fun-packed event. Register today and bring your team. All in-house Global Mobility professionals can attend for free. All other Suppliers Members are welcome to attend, tickets cost £190 (+VAT) when pre-registered. To register, please visit www.totallyexpat.com or contact Andy Smailes, via email: admin@totallyexpat.com or call +44 (0)7972 232 341

OCTOBER 2012 Global Workforce Symposium October 3-5, 2012 Marriot Wardman Park, Washington, DC, United States of America The leaders in global workforce mobility will be networking, strategizing and sharing ideas for thriving in the global marketplace. Experience new heights in workforce mobility by attending this unique programme! Email: webmaster@worldwideerc.org to be notified when registration opens or visit www.worldwideerc.org for further information.


DIRECTORY Assignment Management Services

Total Reward Group Chart House, 10 Western Road, Borough Green, Kent, TN15 8AG Contact: Simon Richardson Telephone: +44 (0) 1732 780777 Fax: +44 (0) 1732 668284 Email: simon.richardson@totalrewardgroup.com Website: www.totalrewardgroup.com Total Reward Group is a ‘boutique’ employee owned reward practice, providing consultancy, search, interim managers and professional training for analysts. The Global Mobility division of TRG provides both advisory services on policy development, as well as fully outsourced assignment management services, which provides a ‘virtual’ in house Global Mobility HR service.

BUSINESS ASSOCIATION J-1 VISA PROGRAMME

BRITISHAMERICAN BUSINESS (BAB) 52 Vanderbilt Avenue, 20th Floor New York, NY 10017, USA Contact: Tamra Eker Telephone: +212 661 4060 Fax: +212 661 4074 Email: teker@babinc.org Website: www.babinc.org BritishAmerican Business’s J-1 visa program assists companies in offering US training and work experience to qualified employees of any nationality and from anywhere in the world, for a time period of up to 18 months. Sectors covered by our J-1 Visa designation include management, business, commerce, finance, law, industry, sciences, engineering, architecture, information media & communications. Using the J-1 Visa helps companies overcome cross-cultural differences and improve communication between US and overseas offices; enhance employee recruitment/retention efforts by offering US assignments; and meet global mobility challenges. Please call to discuss the program with our J-1 Visa Program Administrator.

HEALTH INSURANCE

Bupa International Telephone: + 44 (0) 1273 718304 Website: www.bupa-intl.com • Bupa – A name trusted by 10 million people in 190 countries • The international healthcare provider with over 35 years’ experience • Multi-lingual helpline open 24 hours • Direct currency settlement • Optional assistance cover including evacuation and repatriation. Depending on the member’s requirements, Bupa International offers plans for both individuals and companies. Most of our plans include; primary care, maternity cover, home nursing, emergency dentistry, hospital treatment and accommodation, health checks, cover for chronic conditions, emergency road ambulance, cover for sports injuries.

HR CERTIFICATION/ CREDENTIALS

HR Certification Institute 1800 Duke Street, Alexandria, Virginia, 22314, USA Telephone: +1-703-548-3440 Fax: +1-703-535-6474 E-mail: info@hrci.org Website: www.hrci.org HR Certification Institute is an internationally recognised certifying body for the HR profession. We have awarded over 100,000 credentials in over 70 countries to HR professionals who have passed rigorous exams to demonstrate their mastery and real-world application of forward- thinking HR practices, policies and principles. Our certifications are a career long commitment that requires continual HR career development to maintain certification. Four certifications are offered: the Professional in Human Resources (PHR®), Senior Professional in Human Resources (SPHR®), Global Professional in Human Resources (GPHR®), and the California state specific PHR-CA® and SPHR-CA®.

HR SERVICES

ASSOCIATION OF RELOCATION PROFESSIONALS (ARP) PO Box 189, Diss, IP22 1PE, UK Contact: Tad Zurlinden Telephone: 08700 737475 Fax: 01379 641940 Email: enquiries@arp-relocation.com Website: www.arp-relocation.com The ARP is the professional association for the relocation industry in the UK. The ARP’s activities include seminars throughout the year, an annual conference, the publication of an annual Directory of Members and a website, which is updated regularly. THE EUROPEAN RELOCATION ASSOCATION (EURA) PO Box 189, Diss, Norfolk, IP22 1PE Telephone +44(0)8700 726 727 Fax: +44(0)1379 641 940 E-mail: enquiries@eura-relocation.com Website: www.eura-relocation.com EuRA is an industry body for Relocation Professionals in both Europe and Worldwide. EuRa have launched The EuRA Quality Seal, the world’s first accreditation programme for relocation providers. This pioneering initiative provides a straight forward, cost effective audit to reflect your company’s excellence in providing relocation services.

IMMIGRATION

FRAGOMEN 4th Floor, Holborn Gate, 326-330 High Holborn, London, WC1V 7PP Contact: Caron Pope, Partner William Foster, Partner David Crawford, Partner Telephone: +44 (0)20 3077 5000 Email: londoninfo@fragomen.com Website: www.fragomen.com

As the world's leading provider of immigration legal services and advice, Fragomen has served the immigration needs of clients ranging from individuals to the world’s leading multinational corporations for 60 years. With 36 offices in 15 countries worldwide, Fragomen has the resources and the reach to provide strategic and effective immigration solutions for over 140 countries around the globe.

INSURANCE AND FINANCIAL SERVICES ZURICH INTERNATIONAL LIFE Abbey Gardens, 4-6 Abbey Street Reading, Berkshire, RG1 3BA Contact: Adele Cox Telephone: +44 (0) 118 952 4253 Fax: + 44 (0) 118 952 4300 E-mail: adele.cox@zurich.com Website: www.zurichinternational.com Zurich International Life is a global provider of life insurance, investment and protection products. Our corporate range offers flexible, portable solutions, designed to suit multinational organisations with an internationally mobile workforce. The International pension plan offers a cost effective, bundled retirement benefits solution comprising of trust services, investment funds and online administration. International group protection is designed to protect an employers’ most important asset – their employees – and offers a range of life and disability protection. With a local presence in key global business hubs and over 20 years experience of implementing and administering plans world wide, we’ve developed our knowledge and understanding of key markets to meet the needs of our customers and business partners.

INTERNATIONAL HR CONSULTANTS

DELOITTE LLP Stonecutter Court, 1 Stonecutter Street, London, EC4A 4TR Contact: Robert Hodkinson, Partner Telephone: +44 (0) 20 7007 1832 Fax: +44 (0) 20 7007 1060 E-mail: rhodkinson@deloitte.co.uk Website: www.deloitte.co.uk Whether you are creating your first international mobility programme for employees or addressing fundamental changes to an existing programme, our International Human Resources team can help. Deloitte provides consulting support that has an appreciation for each company’s size, background and unique cultural environment, aligning your international programme goals with corporate business strategies. Our consultants have developed deep expertise in many fields based on first hand experience with many of the world’s leading organisations: international assignment policy and process design, benchmarking, service delivery modelling, improving vendor management and helping our clients become more compliant and their administration more cost-effective. Winter  International HR Adviser

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DIRECTORY INTERNATIONAL MOVING

DT MOVING LTD 49 Wates Way, Mitcham, Greater London, CR4 4HR Contact: Tim Daniells Telephone: +44 (0) 20 7622 4393 Fax: +44 (0) 20 7720 3897 Email: london@dtmoving.com Website: www.dtmoving.com DT Moving is a world leading international moving company. Founded in 1870 as Davies Turner, we provide an awardwinning* move management service for corporations who relocate their employees to locations all over the world. Whether your employee is moving to or from Europe, America, Asia-Pacific, Africa, or simply just around the corner, we manage the entire process. Our goal is your complete satisfaction from initial contact right through to delivery. With a customer satisfaction rating of 96% for 2010, we offer unrivalled quality at competitive rates.

RECRUITMENT

RED GROUP OF COMPANIES The Bower, Langford Hall, Witham Road, Maldon, Essex, CM9 4ST Contact: Caroline Frostick-Seear and Amie Cutts Telephone: 01621 840600 Fax: 01621 856062 Email: amie.cutts@redrecruit.com Website: www.redrecruit.com Red Recruit was founded in 2002 and specialises in the Relocation and mobility industry. We are a very professional, friendly and reputable company who have extensive knowledge within the industry. We have access to a large volume of potential candidates all seeking work in your industry all over the UK, we will be able to find you a suitable candidate to enhance your business. We personally understand the importance of finding the right calibre of staff for an organisation. By using our service we will take the pressure off you of finding a suitable candidate for your company, saving you time, money and effort, giving you the best attention at all times.

RELOCATION

INTERDEAN RELOCATION SERVICES Central Way, Park Royal, London, NW10 7XW Contact: Barrie Gilmour Telephone: +44 (0)208 961 4141 Fax: +44 (0)208 965 4484 Email: London@interdean.com Website: www.interdean.com Thinking Relocation? Think Interdean. Whether looking to expand into new territories or to leverage your human capital in core international markets, Interdean has the relocation service to support the needs of your business and your relocating employees. Interdean provides the full range of relocation services to support businesses with international interests. Our Services: Relocation Management, Visa & Immigration, Area Orientation, Temporary Housing, Home Finding, School Search, Settlingin Assistance, Tenancy Management, Household International HR Adviser  Winter

Goods Moving, Intercultural & Language Training, Relocation Expense Management, Moving & Relocation Insurance and other services available – please ask.

SCHOOLS

ACS INTERNATIONAL SCHOOLS ACS International School Heywood, Portsmouth Road, Cobham, Surrey, KT11 1BL, England ACS International School London Road (A30), Egham, Surrey, TW20 0HS, England ACS International School Hillingdon Court, 108 Vine Lane, Hillingdon, Middlesex, UB10 0BE, England ACS International School Al Oyoun Street, Al Gharrafa, PO Box 200568, Doha, Qatar Telephone: 01932 869 744 Email: cobhamadmissions@acs-schools.com Website: www.acs-schools.com Contact: Dean of Admissions ACS International Schools were founded in 1967 to serve international and local communities. The schools are non-sectarian and co-educational (day and boarding), enrolling students aged 2 to 18 years. The UK based schools have over 30 years’ experience of teaching the International Baccalaureate, and ACS Doha offers an international and American curriculum. ISL Group of Schools Two UK schools: Old Woking Road, Woking, Surrey, GU22 8HY 139 Gunnersbury Avenue, London, W3 8LG Tel: +44 (0)1483 750409 +44 (0) 20 8992 5823 Email: hmulkey@islsurrey.com Website: www.islschools.org Contact: Heather Mulkey The ISL Schools offer an international education with an important addition: mother tongue or modern language training from an early age. Academic research increasingly points to the importance for English as an Additional Language learners of gaining a solid language and literacy foundation in their own language. For English speakers, research supports the value of language learning in overall academic success. Looking towards our students' global future, multiple language facility will become increasingly valuable. ISL London is one of the first schools to offer the IB Diploma and next year celebrates its 40th Anniversary. TASIS THE AMERICAN SCHOOL IN ENGLAND Coldharbour Lane, Thorpe, Surrey, TW20 8TE Contact: Karen House Telephone: +44 (0)1932 582316 Email: ukadmissions@tasisengland.org Website: www.tasisengland.org TASIS England offers the International Baccalaureate Diploma, an American college

preparatory curriculum, and AP courses to its diverse community of coed day (3-18) and boarding (14-18) students from 50 nations. The excellent academic programme, including ESL, is taught in small classes, allowing the individualised attention needed to encourage every student to reach their potential. Outstanding opportunities in art, drama, music, and athletics provide a balanced education. Extensive summer opportunities are also offered. Located close to London on a beautiful and historic 46-acre estate.

TAXATION

BDO LLP 55 Baker Street, London, W1U 7EU Contact: Andrew Bailey Telephone: 020 7893 2946 Fax: 020 7893 2418 E-mail: andrew.bailey@bdo.co.uk Website: www.bdo.co.uk BDO LLP is the award-winning, UK Member Firm of BDO International, the world's fifth largest accountancy network with more than 600 offices in 100 countries. We have a partner-led approach, which delivers the highest quality of service by using short, functional chains of communication to aid decision-making. Clients benefit from our fresh thinking, constructive challenge and practical understanding of the issues they face. Developing strong, personal relationships with our clients is at the forefront of our service approach. Tax advice is just one of our award-winning services and our expatriate team give practical and direct advice, delivering solutions which suit your needs. DELOITTE LLP Stonecutter Court, 1 Stonecutter Street, London, EC4A 4TR Contact: Robert Hodkinson, Partner Telephone: +44 (0) 20 7007 1832 Fax: +44 (0) 20 7007 1060 E-mail: rhodkinson@deloitte.co.uk Website: www.deloitte.co.uk Deloitte’s Global Employer Services is comprised of approximately 2,600 people in over 80 countries. We take a holistic approach to international assignment tax compliance and planning, ensuring that proposed strategies deliver full value to our clients and their international assignees. As well as assisting with employer core compliance, such as tax returns and year end procedures, we provide an end-toend solution that covers a range of services from tax compliance services, payroll support and policy development, international assignment programme administration (“co-sourcing”) capabilities and global visa and immigration services. We also have a dedicated global team of GES technology professional.

Entries in this Directory cost £175 per issue or £600 per annum. For further details email helen@internationalhradviser.com or telephone +44 (0) 20 8661 0186


EE SELECTED? TAX DVISER?

One of the less appealing things about sending your people overseas is that you, or they, suddenly have to become everts on the local tax system or risk falling foul of the law, incurring extra costs • or both. With REND however, yoo and your people tan benefit from coordinated tax advice. Advance planning will save you time and money and our specialist tax advisers are welt equipped to ease the burden. Through BDO, the world's fifth largest accountancy network, our Expatriate teams can provide you with as4i stance all over the world. To find out more about the talc service that travels with you, please canto{ i Andrew Bailey

+44 (0)20 7893 2946 or

a n drew. baiteyobdo,cro uk

BO as Expatriate Tax service is run by our Human CdpiidE team, seviiiiki also provides a Full range or expertise in onproyment tax, reward planning and pensions vvww.bdo.co.uk

800 (LP and LIDO Northern Ireland are both separately authorised and regulated by the -mantiall Servit.es AuthDriEy ED conducl irrorArmnt busiiies3

BDO


International HR Adviser Winter 2011