International HR Adviser Winter 2014/2015

Winter 2014-15

ISSUE 60

Free Subscription Offer Inside

International HR Adviser The Leading Magazine For International HR Professionals Worldwide

Features Include: Home HR Rely Too Heavily On Email For Engaging Assignees Maximising Learning And Development From International Assignees Talent And Mobility Alignment - The Next Frontier • What Is Tax Equalisation?

The Talent And Global Mobility Partnership • International HR Strategy • Global Taxation Update Online IB Education May Be The Answer For Families Going On Assignments To Hardship Countries Businesses In Crisis: Perspectives On Ebola Outbreaks -Past, Present And Future Advisory Panel for this issue:

Expatriate Adviser Summer

Autumn International HR Adviser

CONTENTS

In This Issue Page 3

International Assignments: Maximising Learning And Development From International Assignees David Collings, Professor of HRM at Dublin City University Business School

Page 6

Compensation & Benefits: Succeeding In The Quest For Talent Peter Cox, Zurich International Life

Page 8

Engaging Assignees: Home HR Rely Too Heavily On Email For Engaging Assignees John Rason, Head of Santa Fe Group Consulting Services

Page 10

International HR Strategy: Strategic Moves: 3 Years On. An Evolution In Global Mobility Andrew Robb & Helen Odell, Deloitte Global Mobility Transformation

Page 14

Global Mobility Director’s Comment: Talent And Mobility Alignment – The Next Frontier David Wells, Director of Global Mobility, Diageo Plc

Page 17

Global Recruitment Issues: Global Issues For HR And Recruitment Departments Traci Canning, First Advantage

Page 21

Cost Of Living: A Decade In The UAE Engy Ziedan, Cost of Living Reports, Middle East

Page 25

Taxing Issues: What Is Tax Equalisation?

Andrew Bailey, BDO LLP

Page 28

Global Taxation: Global Taxation Update Andrew Bailey, BDO LLP

Page 32

Serviced Apartments – ‘Mind The GAP’ Hospitality, Services And Deliverables In The Serviced Apartment Industrys Jo Layton, The Apartment Service

Page 34

Health: Businesses In Crisis: Perspectives On Ebola Outbreaks – Past, Present And Future Dr Simon Worrell, Healix International

Page 36

Education: If Your Employees Won’t Go To Hardship Countries Because Of Their Children’s Education, Then Online IB Education Options May Be The Answer David Rose, Head of School, Dwight School London

Page 38

Diversity & Inclusion: Five Ways To Build Global Support For Diversity And Inclusion Sue Brooks, Cielo Talent Consultancy

Page 41

Talent And Global Mobility: The Talent And Global Mobility Partnership Peter Sewell, Crown World Mobility

Page 43

Talent Management: The Employer/Employee Relationship In Transition: Navigating The Unwritten Expectations Brenda Harrington, Adaptive Leadership Strategies, LLC

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 • Email: damian@internationalhradviser.com www.internationalhradviser.com In Loving Memory of Assunta Mondello 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

Winter International HR Adviser

1

Expatriate Adviser Summer

Autumn International HR Adviser

INTERNATIONAL Assignments

Maximising Learning And Development From International Assignments There is little doubt that many global organisations continue to face challenges in attracting and retaining the quality and quantity of leadership talent they require to deliver on sustainable growth and should be on a global basis. Global mobility has long since represented a key means by which these firms have facilitated the development of global leadership capability in their leadership cohorts.

Indeed Cartus’ 2014 Trends in Global Relocation Survey found that amongst firms who expected assignee levels to increase over the coming two years, developmental objectives were the key driver for more than 50% of them.

While intuitively the value of international experience in senior leaders is clearly evident, academic research provides empirical support for the positive relationship between topmanagement team (TMT) international assignment experience and indicators of firm performance, and levels of international diversification. The value of global mobility in leadership development is driven by the expectation that international experiences are central in forming and moulding a talented individual by developing through learning from experiences. Indeed, global assignments are considered to be the most effective means of developing such competencies. The objective of this article is to consider some emerging research evidence that facilitates our understanding of how the value of international assignments can be maximised in terms of learning and development while on assignment.

Cross-Cultural Competencies As The Building Blocks First and foremost research points to the importance of underlying competencies that predict effective assignee performance and the potential to learn from global experience. Building on a large body of research evidence Caligiuri and Dragoni summarise these competencies in terms of four broad categories. These four sets of cross-cultural competencies focus on the key aspects of performing effectively in the global context. Self-management

competencies address the requirements to internally regulate and manage the complexities and uncertainties of operating in novel cross-cultural environments. Sample competencies include tolerance of ambiguity, cultural curiosity and humility. The second group of competencies, termed relationshipmanagement competencies, are focused on building connections with key stakeholders in the global context. The focus is on effective communication and building trust and credibility with local employees and other stakeholders.

Sample competencies include mindful communication skills, perspective taking, and relationship building. Businessmanagement competencies are focused on business strategy. They facilitate

understanding the key elements of both organisational and national culture, and the interconnected system of the context which includes laws, regulations, level of education, and similar factors which impact on doing business globally. Sample competencies include receptivity to diverse ideas, ability to foster innovation, stakeholder influence, and ethical decision-making. Response management competencies represent the final group of competencies identified by Caligiuri and Dragoni. These competencies include cultural adaptation, cultural minimisation and cultural integration. They facilitate understanding the cultural nuances of doing business and how to respond in a way that facilitates the deliver of personal and organisational goals.

Table 1: Cross-Cultural Competencies Cross-Cultural Competencies

Typical Competencies

These Competencies facilitate‌

Self-Management Competencies

Tolerance of ambiguity Cultural curiosity Humility and appropriate self-efficacy

Managing emotional responses in complex and ambiguous crosscultural environments

RelationshipManagement Competencies

Perspective taking Ability to form relationships Mindful communication skills

Connecting with others from different cultures, communicating appropriately, to build trust, and gaining the necessary credibility to lead

BusinessManagement Competencies

ResponseManagement Competencies

Receptivity to diverse Accounting for the ideas business strategy, the key Ability to foster elements of the culture, innovation and the interconnected Ability to influence system of the context stakeholders which includes laws, Ethical decision-making regulations, level of Ability to network education, and similar globally factors Cultural adaptation Cultural minimisation Cultural integration

Understanding the ultimate professional goal and respond in a manner that will have the intended outcome

Source: Adapted from Caligiuri and Dragoni (2015)

Winter  International HR Adviser

3

4

INTERNATIONAL assignments Clearly these competencies are illustrative and any competency profile should reflect the particular organisational content in which they are developed.

Broadly however, they can be considered enablers of effective performance and learning in the international arena and should be evaluated in the selection phase.

The Nature Of The Experience Is Key Once these competencies are in place the nature of the experience gained when on assignment is considered central to the extent of learning while on assignment.

Historically, time on assignment was considered a key factor in explaining learning and development. More recent research has however, recognised that time spent on assignment is simply an enabler of bringing about impactful development of global leaders. In this regard, the qualities of the experiences gained while abroad also emerge as significant. Specifically, the extent of cultural difference or the cultural contrasts through which such leaders develop more elaborate cognitive structures that represent more advanced levels of global leadership competence are key. Research confirms that developmental assignments are associated with higher levels of development in assignees. This work confirms that assignments premised on management development, foster personal change and role innovation as the assignee adapts his or her frame of reference in acclimatising to the new environment. This perhaps explains why developmental assignments appear to have greater career-enhancing effects than other forms of assignment.

A central theme in this literature is that international assignments develop individuals more holistically, compared to formal training or more narrow experiences such as international business travel, by exposing them to the challenges of living and working in a foreign country. The significance of high-contact, cross-cultural leadershipdevelopment experiences as central in fostering this personal change and role innovation is highlighted in this research.

This is reflected in higher levels of peerlevel interaction in the novel cultural environment and the practice of newlylearned behaviours in the multi-cultural context, the receipt of feedback, and an emotionally and professionally safe environment where risks can be taken and mistakes can be made. Further, the International HR Adviser Winter

more individuals engage in high contact cross-cultural learning experiences, the greater opportunity they have to reproduce and refine the new behaviours for later application.

On balance this literature points to the impact of mastering challenging and complex issues and problems in novel and high-pressure situations combined with the requirement to work in complex and highly-uncertainty conditions, and the need to lead and influence colleagues and other stakeholders with diverse mindsets, ambitions and goals as important drivers of on-the-job learning are key.

Implications For Global Mobility A better understanding of how international experience facilitates the development of global leadership competencies has implications for the global mobility function in terms of the management of global assignee populations. Clearly, first and foremost, for assignments premised on developmental objectives it seems that selection should include a consideration of an appropriate competency profile.

Given that in many organisations global mobility becomes involved in the support process after the assignees has been selected, this reinforces the importance of early intervention of the global mobility function. Broadly the discussion also reinforces the importance of a higher level of integration between global mobility and global talent in facilitating the appropriate sourcing of candidates, career planning and matching of talent to particular roles with a developmental focus. The selection of appropriate roles to maximise the development potential seems key. Support could also focus on helping the assignee to assimilate learning opportunities from the host country and facilitating the application of this knowledge on repatriation. This represents an expanded agenda in terms of support reflecting support beyond that aimed at facilitating performance in role such as cross-cultural training or language support. Similarly, in evaluating the success of international assignments premised on developmental objectives, one should consider broadening the focus from purely work effectiveness and recognise the importance of learning effectiveness. It may be worthwhile to recognise and evaluate the extent to which apparent failures on assignment can also

constitute important learning events. This calls for the effective tracking of return on investment over a longer time period of say three to five yeas.

Suggested Reading Caligiuri, P. and Dragoni, L. (2015) ‘Global Leadership Development’. In D.G. Collings, G.T. Wood and P.M. Caligiuri (eds) The Routledge Companion to International Human Resource Management, New York, Routledge.

Dragoni, L., Tesluk, P. E., Russell, J. A., & Oh, I-S. (2009). Understanding managerial development: Integrating developmental assignments, learning orientation, and access to developmental opportunities in predicting managerial competencies. Academy of Management Journal, 52, 731-743.

Mendenhall, M.E., Reiche, B.S., Bird., A. and Osland, J.S (2012) ‘Defining the global in global leadership’, Journal of World Business, 47, 493-503.

Oddou, G., Mendenhall, M., and Ritchie, J. B. (2000) ‘Leveraging travel as a tool for global leadership development’, Human Resource Management, 39(2, 3), 159–72.

David Collings (PhD) is Professor of HRM at Dublin City Univeristy Business School where he leads the HR Directors’ Roundtable. He also Principle Academic Advisor at the Maturity Instutute - a global network striving to create vibrant, healthy and successful organisations through maximising the value of people. His research and consulting interests focus on talent management and global mobility. A key focus of his recent work is on understanding how employees add value in organsiations and how organisations can support key employee groups, including international assignees, in generating sustainable performance. In 2014, he was named as one of the most influential international thinkers in the field of HR by HR Magazine. His consulting and speaking engagements include multinational companies in Denmark, Germany, Ireland, the Middle East and the UK. He has published numerous papers in leading international outlets and edited seven books, most recently The Routledge Companion to International HRM with Paula Caligiuri and Geoff Wood.

Autumn  International HR Adviser

6

Compensation & Benefits

Succeeding In The Quest For Talent In this article we’re going to look at the part corporate savings plans can play in managing employee recruitment and retention. This may seem a bit strange when the focus in the UAE has been on getting through the difficult times that every marketplace in the world has suffered recently. But things are starting to change.

In the GCC Compensation and Benefits Trends in 2014 survey (GCC Compensation survey), 51% of employers said they had increased headcount. This is a trend that looks likely to continue as optimism about economic recovery increases and the region gains greater importance on the world stage, with UAE Expo 2020 and the Qatar World Cup set to boost investment and employment.

While this is good news for the economy, companies are starting to experience the difficulties this brings in terms of staff attrition rates. Job mobility is on the increase as employees move around, lured by additional remuneration and perks from competing firms.

As companies struggle to retain employees, counteroffers are common – and employers are finding it challenging to retain their best staff and deal with the cost and disruption of replacing talent.

In the GCC Compensation survey more than 40% of employers reported an 8% to 10% attrition rate in 2013, with nearly 20% reporting 10% or more.

These figures demonstrate the fight for talent the region is experiencing as a result of economic recovery.

to EOSGs. How will any intended plan interact with this statutory obligation? In other words, is the savings plan instead of or in addition to EOSGs? So let’s deal with EOSGs first and then move on to the bigger picture.

Legislation underpinning the EOSG goes back to the 1980s and it was designed to compensate expatriate workers for the fact that no government scheme exists for them to build up basic retirement savings.

The amount of the EOSG payment depends on the employee’s salary at the time they leave service and how long they have been with their employer.

In 2008, a report from the UAE Ministry of Labor revealed that the average length of service was 4 years and 7 months. And at that time, the average salary was AED 10,120 per month.

Due to a trend of individuals staying longer in the UAE, today average service has increased to approximately 6 years and 10 months. And using salary inflation data, the average salary is now approximately AED 14,380.

This increase in service and salary equates to a 140% increase in the gratuity entitlement, yet these increasing liabilities largely remain unfunded in the region. A recent survey from Towers Watson* found that 84% of companies indicated they settle employees’ benefits as they become due from company assets.

We’ll return to the subject of funding later in this article, but first let’s take a look at EOSGs from an employee’s point of view.

Changing Demographics

Zurich’s recent YouGov survey, carried out in July this year asked 1000 UAE residents for their views on this statutory benefit, whether they thought it would provide enough for their retirement, what they were planning to do with their EOSG when they left their current job and what employee benefits would make them more inclined to stay with their current employer.

Against this backdrop of an improving economy and competition for the best talent, employers are aware that competitive remuneration is vital for attracting and retaining high-performing employees. However, using salary as the only retention tool is a blunt instrument – the employer lacks any control over that benefit once it is paid. There is also the resulting impact on end-of-service gratuity (EOSG) benefit calculations.

There must be a better way of rewarding employees, while retaining some control.

A Growing Liability Conversations about corporate savings plans more often than not come back International HR Adviser Winter

The Employee View

Interestingly, 59% were not aware of how to calculate their end of service gratuity entitlement. This isn’t surprising really when it’s not promoted as a benefit. How many employees know that if they resigned in the first five years of employment their entitlement would be reduced, while if they stayed longer than five years it would be enhanced? Possibly very few.

If they left their current job, most respondents said they would be inclined to save their EOSG, with some planning to save it for retirement. Perhaps in the absence of an employer-sponsored plan, they feel the need to address the issue of retirement savings themselves. On the other hand 22% seem to have spent it already and will use it in terms of clearing debt.

A significant 83% acknowledged that an EOSG payment will not be enough to cover their retirement expenses – this figure rose to 91% among westerners.

What Employee Benefits Would Improve Retention?

If those responses aren't interesting and enlightening enough, here's another response that should have you sitting up and taking notice.

The survey asked “Which of the following employee benefits would make you more inclined to stay with your current employer or join another employer if they were included within your package?”

Below are the results, split by nationality.

The vast majority nominate a structured savings/retirement plan. Having already told us that EOSGs are not enough to cover retirement expenses, perhaps this shouldn’t be a surprise. But what is surprising is that not many employers currently offer such a plan – some differentiate themselves by doing so, but many do not!

Total

Arab Expat

Asian

Westerner

Savings/Retirement plan

58%

53%

58%

71%

Life insurance

35%

21%

42%

39%

Critical illness cover

31%

29%

35%

35%

None of the above

21%

27%

17%

19%

Compensation & Benefits Corporate Savings Plans As A Retention Tool The challenge for employers then is to respond to market demand and start using a corporate savings plan as a tool to recruit and retain the best talent.

What aspects of these plans can help you to achieve your recruitment and retention goals?

• Eligibility rules relating to service and/ or grade/seniority • Employer contributions, increasing based on years of service and/or grade/ seniority • Matching employee contributions (encouraging workplace savings) based on years of service • Vesting rules – employer contributions accumulate but entitlement on leaving is service related. Employees would know the rules at outset • Economies of scale – employers can provide a far more cost-effective way of saving than is available to individuals • Make benefits visible online so employees can see assets building up in their name with real-time values. The more that builds, the stronger the wish to remain as the financial implications of leaving can be easily calculated.

All of these points have been in use for many years in developed markets because they work. For example, many 401(K) plans in the US have graded vesting from two to six years. Employer contributions will be seen as an increasing reason to remain in service as funds and entitlement grows.

While savings in the UAE are not tax incentivised, you can make them ‘service incentivised’ through employer contributions. It’s important not to forget that EOSGs are a retention tool – if an employee leaves voluntarily within five years their entitlement is reduced but if they stay more than five years, there is an uplift in accrual. Don't waste this feature, build on it!

For example, why not create a vesting rule at that five-year point in relation to additional employer savings?

Turbocharge your EOSG and make it far more financially significant in order to aid retention. Put your employees in a position where they will have to think very carefully about leaving because of what they are potentially giving up.

Corporate Savings Plans As A Way To Fund Eosg Liabilities As well as being a way that employers can offer more than an EOSG, a

corporate savings plan can be an excellent way to fund those growing liabilities we covered earlier.

A corporate savings plan will offer cost-effective access to a range of investments that have the potential to achieve better returns than a deposit account. Administration should be straightforward and funds can be held in a ‘non-earmarked’ account, giving the flexibility to fund EOSG liabilities as and when required.

Stand Out From The Competition Evidence shows that individuals are not saving enough for their later life – a problem compounded by the fact that they will be living longer. They will therefore face a difficult choice – save more or spend more years working?

We know from our survey that employees are aware that an EOSG payment will not be enough to cover their retirement expenses. This creates an opportunity for employers to both support their employees future financial security and achieve their business goals.

Establishing a corporate savings plan with its own eligibility, contribution and vesting rules can differentiate you as an employer of choice and help you succeed in your quest to attract and retain key talent.

About The Zurich ‘End Of Service Gratuity’ Survey Between July 16 - 23, 2014, 1,000 residents living in all seven Emirates of the UAE were surveyed online by YouGov. Respondents were asked about their views and understanding of the end-of-service gratuity. *Towers Watson, End of service benefits survey, 2014.

Peter Cox IMC Head of International Pension Plan Sales Asia Pacific & Middle East Zurich International Life Office Telephone: +971 (4) 425 2427 Dubai Mobile: +971 (0) 56 179 2376 Email: peter.cox@zurich.com

The 2015 Corporate Relocation Conference & Exhibition

Monday 2nd February 2015 from 10.00am - 5.00pm Hotel Russell, Russell Square, Bloomsbury, London, WC1B 5BE

FREE SEMINAR PROGRAMME

10.30am - Raising Internationally Mobile Children: Understanding and Nurturing the Third Culture Kid Experience 11.30am - Did My Identity Get Lost In The Move?

12.30pm - US Tax Updates & Overview Of The US/UK Tax Treaty For US Persons Residing In The UK 1.30pm - Immigration Update 2.15pm - Short-Term Business Visitors: Staying Ahead Of The Game 3.30pm - Employment Disputes And How To Avoid Them 4.15pm - Expatriate Costs Simplified

If you would like to register for any or all of these free seminars, please email helen@internationalhradviser.com We look forward to seeing you there!

Winter International HR Adviser

7

8

Engaging Assignees

Home HR Rely Too Heavily On Email For Engaging Assignees John Rason, Head of Santa Fe Group Consulting Services, draws on the results of the Global Mobility Survey in relation to how companies engage with employees once they are on assignment.

For international organisations, their expatriate assignees typically represent the most costly employee group outside of the Boardroom. From various research studies conducted over the past 20 years we know that between 1 to 3% of the global workforce are international assignees, yet paradoxically represent between 9 to 13% of total global employment costs. So it is no wonder that many organisations are reviewing how they can better engage and retain this significant investment.

Contemporary thinking is looking at the way that we communicate with our international assignees.

The world's largest study of Global Mobility Programmes from the US, South America, Europe, Middle East, Africa, Asia and Australasia, identifies that email is the primary method that businesses maintain engagement with their employees on assignment.

The Global Mobility Survey identified that 82.7% of businesses rely heavily on email to maintain communication with their employees whilst on assignment with a high proportion solely reliant on the medium.

International Communication Strategy Critical To Assignee Engagement And Retention With the perennial focus on talent retention, concerns over assignee attrition and the effectiveness of email for employee engagement, shouldn’t businesses be looking at improving how they communicate with their employees on assignment?

Whilst on assignment overseas, it is easy for an employee to become disengaged from their home business. A company’s communication strategy with its international assignees is therefore critical to the success of its global mobility programme, maintaining the employee’s engagement with the company and ultimately retaining talent.

International HR Adviser Winter

Strategies For Communicating With Your Assignees The web portal www.globalmobilitysurvey. com enables us to review in more detail the communication techniques used by HR and Global Mobility departments to communicate and engage with their assignees. It reveals that programmes managed from different countries and industry sectors vary considerably in terms of the level of communication and types of communication used. For example, programmes managed from the UK performed the worst in terms of levels of communication. UK managed Global Mobility programmes often “left their assignees in the cold”, indicatively with 10% of UK managed programmes having no assignee communication programme in place at all. Indian managed programmes on the other hand indicated the highest level of communication and assignee engagement. Characteristically, they provide mobile devices to their assignees (41%) in order that they can stay in touch more easily.

At an industry level, the Utilities & Energy industry are notably better at keeping in contact with their assignees than any of the other major industries, and 96% of these professionals saying they regularly use email to keep in contact with their assignees. Similarly, their figure for communication provided

via the company-provided intranet is also high, at 64%.

Email, Local Offices And Intranet Unsurprisingly traditional communication strategies lead the way. Email tops the charts when it comes to communication methods with almost all companies using email to communicate. This is in part due to the type of content being exchanged by the business with the assignee and the confidential nature of the information. However, there are now better ways to share confidential information and better ways to engage.

Half of companies (49.7%) also rely heavily on their local HR representative to fulfil the communication with their employees on assignment. This has the benefit of maintaining a level of human contact with the assignee and their family but it cannot be relied upon solely. Culture can vary between offices and it is advisable that there needs to be a connection with the location to where they will be returning to eventually. Simply handing over responsibility to the local office may not be the optimal solution to ensure up to date knowledge of policies, home and host career opportunities and organisational re-organisations. However, personal communication may remain the best way if your assignments are happening in places with limited technology links.

Engaging Assignees Intranets featured in over a third of companies’ communication plans. This has the benefit of keeping them connected with the company operationally, access to job boards and company news.

Effectiveness of this medium relates to domains and it may be suitable for today’s way of working using mobile devices.

Social Media Social Media (SoMe) has become the default method for many assignees to stay in contact with their family and friends whilst on assignment, but so far this medium is slow to be adopted as part of a Global Mobility assignee communication programme with only 4.5% of programmes using dedicated social media groups. Perhaps companies feel it is difficult to take social media seriously in a business context, but it is hard to ignore the opportunities that social media presents.

Unsurprisingly, the media industry leads the way in communicating with its assignees using social media, using social media 10% of the time, although this is admittedly a relatively low number. In contrast, many industries are yet to grasp it as a concept and so far have not begun to use it at all.

Once again, India managed programmes outshone the rest of the world with 12% of these programmes adopting dedicated social media groups to maintain assignee engagement.

Whereas social media may not be appropriate for compliant operational transactions such as the transferring of company documents, it does provide a more personalised method of engaging with the assignee. It removes the formality that is sometimes present in communication via email and intranet.

It is a ready-made tool for companies to achieve a balance between the personable and the professional. In terms of ensuring the assignee has adapted culturally, if they are encouraged to regularly update their social media channels it can provide the company with a more rounded picture of how they are doing in all aspects of their life on assignment.

The Global Mobility Survey provides an excellent opportunity for HR professionals to gain an invaluable insight into the field. With reports of an expected 29% net growth in Employee Global Mobility over the next 12 months, now is the perfect time to find out how your company can get ahead.

Conclusion The message is simple; companies need to effectively communicate to improve engagement with their assignees remotely.

Ultimately this can be expected to improve the retention of employees on overseas assignment.

A company’s assignee communication strategy needs to consider the various options at its disposal and select the correct mix based on who needs to be

communicated with, the sensitivity of what is being communicated and select the communication channels that work best. It is worth noting that for assignee engagement to be effective companies need to go further than simply sending formal documentation. An effort should be made to ensure that assignees remain connected to the company’s culture, news and what is happening in the home business.

Comments by John Rason, Head of Santa Fe Group Consulting Services, based on the findings from the Global Mobility Survey.

T: +44 (0)208 961 4141 E: john.rason@thesantafegroup.com The Global Mobility Survey Used by leading HR, Compensation & Benefits and in-house Global Mobility professionals, the Global Mobility Survey is a pivotal data source for corporates seeking to benchmark and enhance their own employee transfer programmes. The Global Mobility Survey is commissioned by the Santa Fe Group www.thesantafegroup.com and conducted by Circle Research an independent and ISO20252 certified research company.

See www.globalmobilitysurvey.com for more information and to take part in the 2015 survey.

FREE IMMIGRATION SEMINAR Monday 2nd February 2015 at 1.30pm

Immigration Update This seminar will be a practical session providing advice on the latest Immigration developments and the implications for businesses, and will cover Immigration Policy Updates, Global Immigration Strategy and Management, Compliance and Risk Management.

Presented by Ferguson Snell & Associates. If you have an immigration enquiry that you would like Ferguson Snell consultants to cover on the day please email your enquiry in advance to fs@fergusonsnell.co.uk.

To reserve your place in this free seminar please email: helen@internationalhradviser.com

The 2015 Corporate Relocation Conference & Exhibition Hotel Russell, Russell Square, Bloomsbury, London, WC1B 5BE

Winter International HR Adviser

9

10

International HR Strategy

Strategic Moves: 3 Years On. An Evolution In Global Mobility?

In 2011, Deloitte conducted the first Strategic Moves survey, to explore the extent to which organisations felt that their global mobility programmes were aligned to their business and talent strategies. As expected, the results showed that whilst global mobility was recognised as a key strategic enabler, and critical to achieving business and talent goals, very few companies reported having programmes that were fit for purpose or which could adequately support these goals.

In 2012, a follow-up survey was conducted to find out if the same issues persisted, and to what extent organisations were working to address them. The results were similarly un-encouraging; in many of the participating companies there was suboptimal investment in global mobility, with the majority of improvement efforts focused on operational and functional areas rather than strategic alignment. Furthermore, most organisations reported a lack of any planned measurement or reporting on global mobility, meaning that future investments were also unlikely to hit the target and bring about significant change or improvement to global mobility programmes.

Now, three years on, we asked some of the same questions to a group of 95 respondents from 73 different companies to see what, if any, progress had been made, and whether global mobility programmes were beginning to fulfil their strategic potential.

A Challenging New Environment Overall, there has been a slight upward shift in the perception of global mobility programmes amongst respondents compared to 2012; the number of participants rating their programmes as “world-class” has risen from 2% to 8%, whilst the number rating their programme as under-performing has reduced from 6% to 4% (see figures 1 and 2). This suggests that some of the improvement initiatives that were being planned at the time of the last survey may have borne fruit, leading to a small number of companies now being able to move their employees more efficiently and effectively, and make better International HR Adviser Winter

Figure 1

Figure 2

Figure 3

investments in global deployments. Yet despite this improvement amongst a small number of companies, taken as a whole, the responses to this question would suggest that the overall outlook for global mobility remains relatively uninspiring, with still almost two thirds rating their programme as no better than adequate.

However, when the responses are reviewed in conjunction with improvement initiatives that have been undertaken and are planned, a different conclusion suggests itself: rather than global mobility functions failing to have raised their game over the past 3 years, it may be that the definition of what is

considered to be “adequate” or “world class” has changed. That is to say, global mobility is facing a challenging new environment in which the organisational ‘goal posts’ have shifted once more, and global mobility continues to play catch up in terms of its overall effectiveness.

Since 2012, the most commonly completed improvement initiatives have been policy review or redesign, operating model or structure design, and vendor review (figure 3). Taken together, these activities suggest that over the past years the overall focus has been on cost cutting and talent alignment, looking for cheaper and alternative deployment models

International HR Strategy (policy redesign), and reducing global mobility overheads (operating model design and vendor review). This is aligned to general trends we have witnessed in the market, where organisations have been trying to move people globally to meet talent supply and demand mismatches, and develop global employees, but at the same time margins have remained tight and there has been a relentless focus on cost and return on investment.

Yet looking at initiatives currently underway and planned over the next 12 months, more companies are now focusing on areas such as process optimisation, technology and development of global mobility staff, in addition to the perennial policy review. Many of the organisations we work with are undertaking such activities as part of a change in the role of global mobility from being a pure ”processing” function to a partner that can deliver consultative support on complex mobility issues and enable the organisation to optimise their cross-border investments.

Process optimisation, technology enablement and up-skilling of global mobility staff all contribute to this change, allowing global mobility practitioners to spend less time on process activities and more time partnering with the business to discuss such cross-border investments.

In our experience, the focus of policy review activities is also changing, from looking generally at having a policy suite which is fit for purpose and covers different strata of employees and assignment scenarios, to more targeted individual policies and overall approaches which address particular talent and business needs (for example, approaches to global roles and policy alignment to organisational diversity and inclusion efforts). This is also aligned to the shift towards a more business oriented and consultative global mobility function than we have previously seen.

Interestingly, the initiative that remains the least popular for consideration is leveraging shared service centres to deliver global mobility services. Whilst we do see a trend amongst organisations with large programmes to consider moving mobility services to shared service centres, particularly where this is being completed for other HR functions, the survey results reflect the fact that many organisations we speak to still see global mobility as too “complex”, and something that needs to be ring-fenced as a ‘centre of expertise’ with no noticeable changes in the function itself.

Yet whilst it is true that specialist expertise

may be required for consultation with the business or dealing with complex cases, many of the organisations we have worked with have been able to move much of the processing and operational aspects of global mobility management to shared service centres by ensuring that processes and operating procedures are standardised and executed consistently by all stakeholders (see our recent article on Global Mobility offshore shared service centres for more detail). In fact, the Deloitte 2013 Global Shared Services Survey found that 22% of organisations were utilising shared services for expatriate administration, and that amongst organisations which did not currently use them for this purpose, this was one of the most common areas being considered. In addition to aiding process efficiency and cost reduction, utilisation of shared service centres can free up time for the rest of the global mobility function to focus on higher value consultative activities. Organisations which discount this an option may be inhibiting their

own development, and this may be one of the reasons why many global mobility functions are still finding it difficult to deliver against the changing expectations.

Figure 4 below, developed in conjunction with Bersin for Deloitte, shows the typical stages of development of a high performance global mobility function. Whereas previously functions achieving Level 3 were considered to be “mature” or “market leading”, now much more is expected of global mobility, including participation in global workforce planning, consulting on the utilisation of global mobility to achieve business and talent goals, and monitoring and analysis of global mobility metrics.

This is a huge step change for a function that was previously considered to be largely administrative in many organisations, and focused solely on delivering operational and compliance excellence. 

Incremental Advancements…

Looking outside of the global mobility function itself at wider global workforce

Figure 4

Figure 5

Winter International HR Adviser

11

12

International HR Strategy

Figure 6

Figure 7

initiatives, it appears that most of the companies surveyed are only just taking the first step towards global workforce management. Out of the responses for global workforce activities completed, underway or being planned within the wider organisation (figure 5), the most commonly reported were global talent strategy (82%) and global workforce planning (68%). On the other hand, very few companies reported use of global employment companies and alternative deployment models (34%) or flexible global resourcing models (38%). This finding suggests that organisations are feeling their way in this area, focusing on how they can begin to create and manage global talent pools, but not yet at the stage of implementing structures and methods to execute these models. Whilst this is a good first step, traditional assignment or transfer scenarios can only be used so far, and a mature global workforce strategy requires much more sophisticated frameworks and structures, including for example, global employment companies, strategic workforce planning and international reward approaches, that truly enable a global approach to managing a global workforce and the creation of ‘one’ global organisation. If they are to fulfil their new role as a business partner and enabler of global business and workforce strategy, global mobility functions will need to International HR Adviser Winter

get to grips with these more sophisticated structures and tools soon.

The reliance on traditional deployment types to address an increasingly complex global talent landscape is also evidenced by the type of workforce planning activities that companies are undertaking (figure 6); 93% of respondents rated their company as adequate or excellent at moving people to work, whereas only 72% could say the same about understanding future skill requirements, and only 75% understanding where skilled workers are located.

Yet these findings should be taken with a pinch of salt: when the same question was asked of HR professionals in the Deloitte Human Capital trends survey 2014, over two thirds of companies reported competency in understanding skills and capability gaps and where skilled workers were located, but only 52% described themselves as competent at moving people to work (global mobility) (figure 7). This highlights, in general, a misalignment in the perception of global mobility amongst global mobility professionals and other HR colleagues, and echoes the results of our 2012 Strategic Moves survey in which 70% of talent and reward professionals surveyed considered global mobility to be underperforming. 

What Lies Ahead?

In addition to asking companies how they

are addressing current global mobility and talent management challenges, we also asked them how they see the future of global mobility (figures 8 and 9).

Amongst respondents, the scenario seen as most disruptive for mobility in the future is increasing interconnectedness, leading to a flexible, virtual workforce.

Yet this isn’t some far removed vision of the future; it reflects a reality that some companies are already beginning to face.

As cross-border teams, remote working and dual-income households become more and more common, together with the emergence of city based talent hubs, many companies are experiencing an increase in numbers of business visitors, commuters and alternative cross-border working assignments. This has a number of implications for both compliance management and programme governance as many companies do not yet have the appropriate mechanisms in place to deal with these scenarios and are doing so at present on a largely ad-hoc basis.

The second most anticipated scenario is a two-tiered labour market of high and low skilled workers, with different types of individuals going on assignment, and greater ability for high skilled individuals to demand customised and high cost package as a result. As with the previous “future vision”, this reflects a trend we see in the market place towards more “bespoke” mobility management and greater diversity in deployment models and practices. At one end of the spectrum, we are seeing more individuals being sent on cheaper, cost-effective, or local moves, reflecting their larger supply of skills in the global workplace versus at the other end a small cadre of “high potential” or specialised skilled labour being sent on rich packages for strategic and business critical assignments.

Once again, these “future visions” make it clear that global mobility can no longer be satisfied with being a process administrator and policy owner for the business, but needs to be prepared to engage with an increasingly complex reality. It needs to step up to the challenge presented to it by the emergence of organisations who manage their workforce on a global basis and look at their future global skills requirements as innovation disrupts their core business models, as well as changes in technology and the way we, as employees, live and work.

This is a significant change to the traditional role of many global mobility functions and global mobility professionals. Yet if they do not rise to this challenge then others

International HR Strategy

FREE SEMINAR

Figure 8

Monday 2nd February 2015 2.15pm

Short-Term Business Visitors: Staying Ahead Of The Game Figure 9

are likely to take their place either inside or outside the organisation, and global mobility as we know it today is likely to be relegated to pure administration as opposed to evolving with the business.

Survival Of The Fittest In summary, it appears that three years on many of the same issues persist for global mobility: a perception that global mobility is not fir for purpose and a lack of any measurement based improvement plans has led to untargeted investments delivering suboptimal or marginal improvements. Yet the real challenge is in the shifting goal posts and the changing expectations of what global mobility should do. With the introduction of global workforce management initiatives, greater cross-border fluidity amongst the workforce, and anticipated diversification of assignees and deployment models, global mobility is required to provide more creative deployment solutions together with analytical capabilities which lead to strategic global workforce insights to support the company in achieving its business and talent goals. As such, now is the time for global mobility to work to get ahead of the curve and plan proactively for these changes.

Andrew Robb Deloitte Global Mobility Transformation Practice Leader. Andrew leads Deloitte’s Global Mobility Transformation (GMT) practice across EMEA. He has extensive experience in leading large mobility transformation projects which includes global workforce planning, mobility strategy, policy design and implementation, best practice process design, vendor rationalisation, organisation and role restructuring. Andy can be contacted at anrobb@deloitte.co.uk. Or +44 20 7303 3237 Helen Odell Deloitte Global Mobility Transformation Senior Manager. Helen is a Senior Manager within Deloitte’s Global Mobility Transformation (GMT) practice in Switzerland where she has extensive experience leading and managing global mobility projects in a range of industries. Her key areas of focus include programme assessment and benchmarking, strategy, policy development, service delivery structuring, process design, and global mobility talent management.

Helen can be contacted at heodell@deloitte.ch. Or +41 58279 7303

Any global employee is potentially a business traveller, capable of creating tax or immigration obligations in any country in an era of increased scrutiny by tax authorities around the world. For many organisations, defining the size of the population and identifying the relevant individuals is the biggest challenge. We discuss how a datadriven approach utilising the latest analytics techniques coupled with tax and immigration expertise can enable a process to identify, review and propose actions for organisations to help manage business traveller compliance risk efficiently for any size of population. Furthermore, this data also provides business and mobility leaders the opportunity to pro-actively manage business travel before an issue arises, identify cost reduction opportunities by analysing spend and evaluate adherence to an organisational travel policy.

Presented by Scott McCormick, Partner and Robin Brown, Senior Manager from Deloitte Global Employer Services This seminar is taking place at The 2015 Corporate Relocation Conference & Exhibition Hotel Russell, Russell Square, Bloomsbury, London To reserve your free place in this seminar please email: helen@internationalhradviser.com or telephone Helen Elliott on 020 8661 0186

Winter  International HR Adviser

13

14

GLOBAL MOBILITY DIRECTOR’S COMMENT

Talent And Mobility Alignment The Next Frontier At every global mobility conference in 2014, there was one common theme on the agenda: “Aligning Talent and Mobility”. Looking at the objectives of Mobility Directors now and over the next 12-18 months, it’s a safe bet that many of us have a goal of finding the elusive “alignment”….

Why Has Talent-Mobility Alignment Risen To The Top Of The Agenda?

In my view, three factors are driving this: • The war for talent has become a huge priority for most businesses – not just at the HR level, but at the Board and Executive Committee as well • Global Mobility functions have evolved (in many cases) from transaction driven support teams, towards strategic business partners • The war for talent is truly global – so it makes sense to explore how Talent and Mobility can align.

Ok, But What Do We Mean By “Talent-Mobility Alignment”?

At those very same conferences discussing the topic, a common theme was that the answer to this question, and the solution to finding the key to alignment, is proving quite elusive. Again, what are the emerging trends?

• Mobility functions are starting to functionally report into Talent – this is a growing trend, moving many companies away from the traditional model of Mobility reporting into Reward, or in some cases shared services • Data analytics is becoming increasingly important – the ability to provide the Talent team with powerful and insightful data on the mobile population which can then help drive an international talent plan • Pro-active assignment planning, in partnership with Talent – mobility teams in some instances are starting to get on the front foot in terms of workforce planning, rather than the reactive tap on the shoulder to facilitate an assignment • Assignee selection – Talent and Mobility teams are increasingly applying suitability and selection International HR Adviser Winter

methodologies to assignees – it takes more than just being “good at the job” to go on an international assignment and be successful • Specific Talent Programmes increasingly have an international assignment as a key component – large numbers of employees are mobilised at the same time.

Let’s look at these emerging trends in a little more detail.

The Mobility Reporting Line There is an increasing evolution towards Mobility reporting into Talent. The reasons for this will of course vary from company to company, but this trend is clearly indicative of the desire to find alignment, and the increasing criticality of mobility in Talent processes. Our role as mobility professionals is, in essence, a simple one: to mobilise talent across borders effectively, in a compliant and cost-effective way, and in support of the overall business strategy. There is a natural linkage between finding the talent (what we in Diageo call Talent Engagement), developing and planning the talent landscape (the Global Talent team) and mobilising (Global Mobility).

The “alignment” should start to come naturally, as a consequence of the reporting line.

The counter argument is around the technical aspects of global mobility – moving talent across borders is highly complex and highly regulated: tax, immigration, compensation variables, interactions with the Finance function – all of these point to a strong need to be closely connected to the other major technical and highly governance driven part of HR – Reward.

Data Analytics Increasingly, Talent functions are data hungry: they want to understand basic demographics (how many IA’s? Where are they?), diversity data (gender balance, emerging markets IA’s), attrition rates (are our assignees completing their assignments?), performance on assignment, and of course cost (how can we measure ROI if we can’t measure cost?).

In my view, the critical piece often

missed from analytics is what happens after the assignment. Does the IA get promoted? Leave the company? Go on another assignment? Where are they 2, 5 and 10 years later? To harvest this data would be a powerful indicator of return on investment.

Pro Active Assignment Planning It must be the most common complaint of the mobility professional: “I’ve just been asked to move x and their family to Nigeria, by the beginning of next month.”

Not enough notice, and a real lack of information around the context – why am I moving this person? A bigger challenge arises in the lack of foresight this reactive approach gives us – how can we forecast future mobility demand, with a reactive way of working? How can Mobility teams provide insight and expertise to the business, if we can’t see the demand?

The trend has to be towards a proactive partnership between Talent and Mobility. As Mobility professionals, we can start with the ultimate question: “do you have to have had an international assignment in order to reach a certain level in the organisation?” If the answer is “yes”, then we can start to help the Talent function plan how many IA’s it will need to end up with a Talent pool large enough to fill the future leadership roles. Of course, there is a win-win here – from a business perspective, pro-active planning will provide huge opportunities to reduce cost, and the IA should have a better experience than scrambling to the airport, work permit in hand!

Assignee Selection There is increasingly a debate around Mobility’s role in selecting assignees – although the most common model by far remains that selection is managed elsewhere, and deployment is managed

by Mobility. That may well be the right model – selecting is a very different skill from deploying, after all.

But Mobility undoubtedly has a role to play in supporting good selection: we should be the members of the HR team who best understand how cultural fit (or lack thereof ) can make or break an

GLOBAL MOBILITY DIRECTOR’S COMMENT assignment, how family unrest can do the same, and the critical role of safety and duty of care in certain locations.

Mobility teams need to be pro-actively promoting the tools available to the business to assess cultural fit for example, – this is not to prevent assignments from happening, but to guide both the IA and the business towards cultural training, or to provide support for spouses. Again, the opportunity exists for Mobility and Talent to partner – enhancing the success rate of assignments, reducing attrition, and avoiding the inevitable costs (financial and emotional) of failed assignments.

Specific Talent Programmes Increasingly, leadership development programmes involve an international assignment as a core part of the curriculum.

In Diageo for example, our Future Leaders Programme (FLP) requires an 18 month assignment for all participants (about 30-50 per year high potential talent).

The assignment is usually to somewhere outside of the employees comfort zone (from a developed to an emerging market for example,) and there is a heavy accent on championing emerging market talent.

For us, this was a fantastic opportunity

to combine most of these trends: • We worked as equal partners with our Talent team to bring the international aspect of the programme to life – joint communications, co-hosted training sessions etc.

• We can report on any aspect of the programme – from cost, to demographics, to attrition • We plan well in advance – our two teams plan the assignments at least 6 months before they kick off, and we work with Talent on the country combinations at an early stage • Assignee selection and learning – we partnered with our cultural training vendor to provide assessment tools and guidance to all participants.

What Does The Future Look Like?

The alignment of Talent and Mobility remains, in my view, in its infancy. Over the next two years, I would expect to see more and more Mobility functions partnering closer with their Talent colleagues (with the possible reporting line changes as a backdrop as well). Mobility functions are and will continue to push for a more strategic role in the Talent agenda.

The “pull” from Talent will continue to be around the power of data, and the ability to add in the often complex colours of Mobility to the Talent landscape.

For Diageo, it’s critical to get this right – our purpose as an organisation is to “celebrate life, everyday, everywhere” – we and our Talent colleagues have a powerful role to play together in bringing the purpose to life across our increasingly “borderless” organisation.

David Wells is Director of Global Mobility for Diageo Plc, the world’s leading premium drinks business.

David has over 20 years of Global Mobility experience, in a mixture of industry and Big 4 roles, and his CV includes 8 years at Rio Tinto Plc as Head of Global Mobility and Head of Expatriate tax, three years as Director in the EY Human Capital practice, and two years enjoying expatriate life with international SOS, based in Singapore.

In his current role, David is responsible for all aspects of Global Mobility, leading a team of mobility professionals in London and Budapest. David is tax qualified with the Association of Taxation Technicians (ATT).

Winter International HR Adviser

15

Expatriate Adviser Summer

Autumn International HR Adviser

Global Recruitment Issues

Global Issues For HR And Recruitment Departments With estimates ranging between 50 and 230 million, the global workforce – those working outside their home country – is undeniably booming and on the move. While organisations worldwide seek the unique skillset of the global worker and appreciate their contribution to workplace diversity, there are nonetheless challenges facing HR and recruitment professionals.

Global Workers – Where Are They Coming From And Where Are They Going?

While size of the global workforce provides a sense of proportion, their comings and goings offer a sense of perspective when considering the challenges and issues.

Here are some relevant statistics: • Saudi Arabia hosted the largest number of expatriates in 2013, followed by the United Arab Emirates and the United States, according to a study

by Finaccord. Other studies show significant expatriate populations in Qatar, Kuwait, Jordan and Singapore • India accounted for the largest number of expatriates living abroad, followed

by China and the UK. Other studies show significant numbers of expatriates whose home country is the US or the Philippines.

Impact On HR And Recruitment Professionals

operational aspects can become vexing for the HR and recruitment professional.

How would we verify a candidate’s Indian advanced degree or United Arab Emirates employment? Unfortunately, all too frequently the answer to those questions is “not at all”.

Organisations which do not screen for the 'international components' of a candidate’s background face issues on multiple fronts: • Compliance: Many organisations have instituted pre-employment screening programmes to comply with internal audit/control practices whilst others are bound by regulators to demonstrate strong controls (Sarbanes Oxley for publicly traded companies) or due diligence in vetting candidates for risk, honesty and integrity (financial services regulations including the Financial Conduct Authority, the Hong Kong Monetary Authority and others; oil and gas industries for demonstration of safety and controls) • Risk: Along with compliance, organisations across all industries want to ensure they are not exposing the business to reputational or other risk – including the risk associated with making a bad hire (someone not qualified or competent for the role they have taken on) • Consistency: Failing to screen certain components for certain candidates

because the screening is “too difficult” creates consistency issues for organisations – as does only screening the international components of candidates with certain geographies in their background. Apart from applying the programme inconsistently, the organisation exposes itself to potential compliance and risk issues related to equal opportunity or discrimination.

First Advantage research on screening trends in the Europe, Middle East and Africa shows that the overall average discrepancy rate is 27.2% - meaning that more than a quarter of all candidate CV verifications turned up an inaccuracy.

In terms of global workforces and expatriate populations, Finaccord analysis shows that “the majority of expatriates in 2013 were classifiable as individual workers (73.6%) followed by students (8.8%), retired expatriates (3.7%) and corporate transferees (1.0%)”.

Moreover, Finaccord predicts that students will constitute the most rapidly growing category of expatriates worldwide between 2013 and 2017, increasing at a compound annual rate of 3.6%, which means there will be an increasing number of people entering the workforce with international degree credentials.

Education qualifications represent the single highest discrepancy rate in the First Advantage research, with a 35.2% overall discrepancy rate.

HR and recruitment departments have taken an increasingly strategic role within their organisations, which is a testament to the value companies place on talent acquisition and talent management. But that does not mean that the tactical and operational aspects of these roles have diminished.

Take Global Mobility professionals, as an example. The RES Forum Report (published in International HR Adviser, Spring 2014) “point[s] to an ever increasing burden on mobility professionals in ensuring programmes are compliant with the multitude of areas which their world touches, including payroll, tax, social security, immigration and Sarbanes Oxley amongst others”.

Pre-employment screening is one piece of the on-boarding experience, and it is with a global workforce that the Winter International HR Adviser

17

18

Global Recruitment Issues A persistent challenge facing risk and HR professionals in Europe and around the world remains the need to balance business risk with individuals’ fundamental privacy rights. In few areas this is more pertinent than when conducting pre-employment background checks, which necessarily involves collecting, storing and processing personal data. Here are some factors to consider in light of data privacy and data protection:

Understand Your Company’s Risk Profile While many organisations consider brand and reputational risk among the top reasons to conduct pre-employment screening, not all businesses face the same types and levels of risk. While organisations understandably wish to avoid bad publicity, risk profiles inevitably vary between companies, industry sectors and primary hiring location. For example, the HR and risk team of a widget manufacturing company is likely to take a very different view of bad-hire risk than the same team in a dynamite manufacturer. Other riskprofile considerations include whether or not the company has regulatory responsibilities to demonstrate due diligence in hiring, such as financial institutions and those working with sensitive or vulnerable people.

For companies with offices in countries with significant expatriate populations (United Arab Emirates and Singapore, for example), the risk profile changes significantly and is compounded if the business is in an industry with a regulatory overlay.

Build A Consistent Policy Pre-employment screening sets the tone of an organisation and establishes expectations for potential and existing employees. (In a purely operational sense, is also provides the framework and principles on which the day-to-day screening programme depends). When developing a screening best practice policy, it is important to consider: • Consistency – applying the same package and depth of checks for all employees of the same level, to ensure fairness and integrity of reporting • Transparency – the existence and nature of your pre-employment screening programme must be well communicated and universally understood. In some countries, any International HR Adviser Winter

measures a company takes in relation to its employees need be discussed with local works councils • Proportionality – this tenet of privacy applies equally to preemployment screening. In short, the background screening and collection of information should not be excessive, or disproportionate to the risk. So, while it would be considered proportionate to conduct a credit check on a person who is handling money, it might be considered excessive to do so for all employees (unless they were working in financial or payment card industries, for example).

Determine Who ‘Owns’ Pre-Employment Screening In some organisations, HR owns screening as part of recruitment/on-boarding whilst in others – particularly regulated ones – risk/compliance teams may take responsibility. In some organisations, responsibility for expatriate or global workforces sits with Global Mobility, who would necessarily need to partner with HR and risk as expert advisors on local country practices. Establishing ownership is important as it also establishes accountability.

Mind The Details • Draft a consent form. In the privacy frameworks of the European Union, some Asia Pacific countries, the United States and the United Arab Emirates, it is required that the individual understands the purpose of data collection, along with how the information will be used and stored.

As pre-employment screening is the collection and verification of candidatesupplied information, consent is a must in countries with privacy frameworks and best practice everywhere else • Build packages of services. Creating pre-defined service packages ensures that your screening policy will be consistently applied. Best practice entrylevel packages include: • Criminal check • Global sanctions and watchlists • Verification of identity documents (e.g. passport).

Depending on the position level or banding, more detailed screening would be required. In expatriate assignments for example, the 2014 Global Mobility Survey (International HR Adviser, Summer 2014) notes that the most difficult assignments

to fill are at the VP/Director level, where higher levels of screening are required, such as: • Directorship • Adverse media • Academic qualifications • Employment history • Employment gap.

Understand Local And Regional Screening Variance When building a programme, it is critical to understand that not all countries take the same view of availability and use of certain types of pre-employment screening information. For example: • Address verification. In the US, the individual's address history is generated based on the candidate’s Social Security number (SSN) and comes from generally recognised credit bureaus; candidates generally are not required to provide a listing of their address history because the SSN provides the means for verification. In that regard, the US is an exception. In the United Kingdom, address history also comes from the credit bureau and electoral roll, but the candidate must provide the details of their addresses, which are then run against the information on file with the credit bureau and the electoral roll. In India, address verification is conducted, but through a process which is different to both the UK and US. In many other jurisdictions, the address history is simply what the candidate has reported (and cannot be comprehensively verified) • Credit checking. While it would be usual in the UK and US to conduct credit checking for relevant positions, certain countries do not allow consumer credit information to be used for anything other than determining credit worthiness. That said, the US and UK credit checks vary widely in terms of the depth and breadth of information that is reported. Other countries, such as Hong Kong and Singapore, use civil litigation and bankruptcy searches more commonly than credit checking.

• Criminal checks. The Basic Disclosure is the most basic level of criminal record check in the UK and is available for all job roles; such is the case with US criminal record checking. However, this is not the case in many other jurisdictions. In Hong Kong and Japan, for example, third-party access to criminal records would not be

Global Recruitment Issues permitted. In Ireland, criminal checking would only be permitted for persons applying for certain roles (such as those working with sensitive or vulnerable populations). In other jurisdictions, a candidate can always get a copy of their own criminal history (certificate of good conduct), but local regulations vary as to whether employers can require candidates to produce it as part of their pre-employment screening.

So, how can an organisation build a consistent policy and screening programme when searches and availability vary from country to country?

Alternative or substitute searches provide a mechanism to apply the highest level of consistency without compromising local regulations around access to records. For example, where criminal checks are not available, a combination of adverse media and global sanctions could be considered a reasonable alternative. In Asia Pacific, civil litigation is commonly used where credit checking is not appropriate.

Final Thought With an increasingly globalised workforce and greater demands on the HR,

recruitment and mobility professionals to support them, making an up-front effort to create a consistent global screening programme provides a template to mitigate and create controls during a crucial phase of the hiring/on-boarding process.

Traci Canning Senior Vice President and Managing Director.

Traci is First Advantage’s SVP and Managing Director for EMEA. With over 12 years’ experience in global background screening, Traci’s rich background includes product management, strategic development and executive management. She is a member of the International Association of Privacy Professionals (IAPP) and is a Certified Information Privacy Professional (CIPP), holding European (CIPP/E), Information Technology (CIPP/IT) and US (CIPP/US) certifications.

First Advantage Europe Limited 2 St. John's Street, Colchester, CO2 7AA, UK T: +44(0) 1206 505 746 E: traci.canning@fadv.com

RECRUITMENT ADVERTISING OPPORTUNITIES If you would like to advertise a vacancy within your department to our readers who are all Global Mobility Professionals, based in 83 countries worldwide, please email: helen@internationalhradviser.com or call Helen Elliott on +44 20 8661 0186 for further details.

Winter International HR Adviser

19

Expatriate Adviser Summer

Autumn International HR Adviser

Cost of living

A Decade In The UAE Over the last decade, the UAE’s nonoil sectors have been the driving force behind the UAE’s economic growth and have managed to outperform the oil industry. Since striking oil in the late 60’s, there’s been a diminishing dependence on the black gold, and a mandate from the ruler of Dubai to cement the UAE’s place on the world’s global economic stage. The UAE operates with a basic, but very successful growth strategy – if you build it, they will come.

Dubai in particular, has rapidly become a hub for businesses across almost all sectors, looking to locate in the Middle East. In 2014, the UAE’s GDP grew by 4.6%, with non-oil sectors growing at 5.9% growth (compared to 5.4% in 2013)1. With such impressive growth rates, the UAE is now widely recognised as a serious contender in a number of global economic indices. The UAE ranked 11th globally in the Foreign Direct Investment Confidence Index (FDICI) and was reclassified as an Emerging Market by the MSCI 18 months ago. Dubai will also be hosting the World Expo in 2020 as well, and Qatar’s successful bid to host the 2022 World Cup is the icing on the cake for the UAE’s seemingly unstoppable economic growth; which will undoubtedly result in an increase in the number of visitors to the country – with the biggest increase expected in Dubai.

Increased market confidence and a rise in the number of firms locating in the region has resulted in an increase in the population of expatriates residing in the country. Data from the International Monetary Fund (IMF) shows that in 2003, approximately 800,000 expats were recorded as working in the private sector, and 30,000 in the public sector, across Dubai and the Emirates’ capital Abu Dhabi. In 2014, eleven years on, 3.4 million are officially recorded as employed in the private sector, and 100,000 in the public sector. The expatriate private labour market participation in Dubai and Abu Dhabi has increased by 325% since 2003.

With an influx of firms, expatriates and rapidly growing sectors, the UAE has evolved into the region’s most attractive hub for global firms, setting up shop in the region, looking to competitively attract and retain the right type of people

for their local operations. But with all opportunity, comes challenge and adversity. Rapid inflation, continually updated labour rules, along with competition from neighbouring Qatar & Saudi have only served to increase the importance of having an informed and targeted C&B strategy with the UAE2.

Removing any local market asymmetry and having access to accurate and detailed data on the cost of living each year, prior to making adjustments and affecting local C&B strategy, is every global HR, mobility and rewards specialist’s starting point. One component of an effective rewards policy is of course setting the right allowances – and there’s no better starting point than the UAE’s buoyant accommodation sector, which is what we’ll examine first.

Accommodation – A Global Comparison One of the most fluctuating sectors, which directly affects the welfare of expatriates and the remuneration policies behind their cost of living, is the accommodation sector. Not only is it a volatile market, it also consumes a significant portion of household disposable income for expatriates in the country. A Cost of Living Middle East Survey in Q2 2014, showed that expatriates in Dubai and Abu Dhabi spend approximately 36% of their annual income on housing3. This is compared with an average of 24% in London, 22% in Toronto and 33% in New York4.

This year, The Cost of Living UAE Report 2014 - 2015 includes almost a

decade’s worth of time-series analysis, showing price fluctuations for both the rental and freehold markets. In Dubai alone, since 2009, the stock of regular property has increased by 25% and luxury property has soared by up to 75%. Occupancy rates in the city have remained around the 70 - 82% mark, yet in the last year alone, despite the new stock entering the market and the 18 - 30% vacancy, we’ve witnessed an average 42% rise in rental rates, and 28% rise in freehold prices. In an attempt to show that it’s not simply a demand-driven hike, we have compared Dubai & Abu Dhabi to other global metropolitan cities. The graph below shows various population densities for a number of global cities, and the relative average rental cost for a 2-bedroom apartment within these cities5. What we can observe below, is that despite the fact that neither Dubai or Abu Dhabi are densely populated, their average rental rates when compared to other metropolitan cities are disproportionately high6.

It’s not only households who are concerned with this anomaly; C&B Managers, Reward Specialists and Global Mobility decision makers with a UAE labour force have to continually keep up-to-date with changing trends by ensuring that they are providing competitive remuneration packages for their staff – with a particular focus on the local housing market, which is the single biggest influence on their employees’ accommodation allowance.

Accommodation – Local Comparisons Global comparisons are of course

Winter International HR Adviser

21

22

Cost of living important for perspective; however, local comparisons are arguably more important because each and every market is different and requires local knowledge and local data, from locally based researchers. The Cost of Living UAE Report 2014-2015 aggregates the masses of data coming out of the UAE, Qatar, Saudi and rest of the GCC, to report on what’s actually happening in detail. As an example, the graph below shows annual rental rates by residential area for 2-bedroom apartments in Dubai, over the past 7 years. The full report provides the same data for all of the UAE’s 7 Emirates, covering all apartment and villa sizes, for rental, freehold and commercial property.

One key observation in this comparison is that across the board, whilst there has certainly been a Y-O-Y rise in 2014 compared to 2013, the rental rates are still not back to the 2008 levels, pre-recession, just before the property bubble burst.

And if there were any seeds of doubt about Dubai and the UAE’s recovery from the 2008 crash, there certainly aren’t now.

Data Source - Cost of Living UAE Report 2014 - 2015

Salary Benchmarking The report covers salaries by firm size, and experience level for 200+ job roles. The salaries reported reflect the median wages in the population within that fiscal year.

A time-series demonstration is available (see middle chart), for two Human Resource roles.

In an ideal world, salary trends would mirror the economy's inflation rate, leaving the real wage somehow predictable and stable. But with a scarce volume of talent across senior positions, and a predominantly young labour market, large firms are paying a premium to keep their labour turnover rates low, and attract high quality talent. In the Cost of Living UAE Report 2014 - 2015, we attempt to answer questions such as, what occupations have the highest variance in terms of earnings?

What is the salary premium paid by large firms, for specific roles? Do employees with different levels of experience face different earnings trajectories, within the same occupations?

Variance In Earnings Across Occupations Reporting median wages is an important requirement for Global Reward Specialists with a UAE labour force, but having an understanding of the wage variance among specific roles is what can give an employer the edge it requires to International HR Adviser Winter

Data Source - Salary Benchmarking Section Cost of Living UAE Report 2014/ 2015. Salary information in this graph is based on 72 large firms surveyed, with 1,000+ employees based in the UAE, along with 233 SME's. The complete list of participating companies from which this data is based, is available in the appendix of our report.

attract and retain the right talent. A small earnings variance indicates that the data points tend to be very close to the Mean (expected value) and hence to each other, whilst a high earnings variance indicates that the data points are very spread out around the Mean and from each other. A small earning variance would indicate that everyone in the labour market, for a given position, gets paid relatively the same

amount. However, a high variance would in fact indicate a wide dispersion of salary levels and a large difference, and therefore potentially more market uncertainty. At Cost of Living Reports Middle East, we wanted to study the earnings variance across different job roles for FY2014. The graph above shows a box plot of monthly salaries in (000’s) UAE Dirhams, for a selection of job roles:

Cost of living In the UAE, whilst compensation across most junior roles doesn’t vary much, large salary variation across Marketing & HR managerial roles can certainly be observed in the local labour market.

References: [1] World Bank Indicators: http://data. worldbank.org [2] For more information on Labour Law updates in the UAE, health insurance amendments, and CPI data please see our Cost of Living Report UAE web page: http:// www.costoflivingreports.com/cost-of-livingreport-uae.php#overview [3] The Mid-Year Cost of Living UAE Report 2014 [4] Data on Average Portion of Disposable income allocated to accommodation was obtained from The OCED Better Life Index, and combined with The Cost of Living Report Data for 2015 [5] Data on population density was obtained from UN-Habitat, a World Bank database, which reports population density, by city each year.

Engy Ziedan is the head of Quantitative Research at Cost of Living Reports Middle East. She has a Masters in Statistics from the University of Illinois at Chicago, and is currently a PhD candidate in Labour Economics. Being a labour economist, she works mainly on quantitative decomposition of wages and returns to skill over time.

Email: engy@costoflivingreports.com Telephone: +97156 450 5205 Analysing the cost of living and all the various components which compromise a remuneration package is what Cost of Living Reports Middle East specialises in. Rather than dictating to our clients how to reward their staff, we analyse all the micro & macro-economic factors, changes in legislation and the current political climate to assess how the local economies in the GCC have performed over the past 12 months, and what to possibly expect in 2015. The above analysis is a snippet of what our 180-page Cost of Living UAE Report 2014 - 2015 contains and is designed to help Global Reward Managers, Global Mobility professionals and any HR personnel with local labour in the UAE, achieve their corporate goals, by equipping them with accurate C&B adjustment suggestions, for the forthcoming financial year.

With 10+ years of cost of living trends in the Middle East, serving over 70 Fortune 500 clients, our reports, both quantitative & qualitative, provide insight into the socioeconomic, political & legislative reforms, for the UAE, Qatar, KSA and rest of the GCC.

Winter International HR Adviser

23

Expatriate Adviser Summer

Autumn International HR Adviser

taxing issues

25

What Is Tax Equalisation?

One topic that regularly arises when dealing with international assignees is the subject of tax equalisation. This often creates confusion and questions for many assignees and those in Human Resources. Given this I thought it would be useful to provide an overview of the principles of tax equalisation: what it is, how it works and some alternative approaches.

Why Is Tax A Factor?

Tax equalisation aims to remove tax as a relevant factor in the international assignment decision process. Without tax equalisation, tax is a factor as tax rates differ from country to country. For example, there will be no tax in Saudi Arabia whereas in Denmark the rate can be nearly 60%.

If companies play no active part in the tax process, individuals often look at their net pay in deciding whether to take up or return from an international assignment.

Continuing with our examples, an individual sent to Saudi Arabia has significantly greater net pay than the individual being sent to Denmark, even though they may do the same job. This of course, assumes there is no continuing tax liability in the home country, which may not be the case for US individuals.

It should be remembered that removing tax from the decision making process does not mean removing tax as a cost. This remains and may increase with tax equalisation. However, in some scenarios tax equalisation could result in funds being received by the employer from the employee.

What Is Tax Equalisation?

Tax equalisation aims to ensure the individual is no better or worse off as a result of taxes whilst on an international assignment. If the tax burden is higher than it would have been in the home country then the company pays the excess, whereas if it is lower then the company takes the savings.

Tax equalisation means that for the individual their net pay remains certain.

The individual knows what they will receive and from a tax perspective it makes no difference to them whether they are in Saudi Arabia or Denmark.

As a consequence there should be less

issues arising over both the timing of assignments and compensation packages.

How Does It Work In Principle?

The principle objective is that the individual is ‘no better or worse off ’ as result of taxes. The steps in determining tax equalisation are as follows: • Determine what the tax liability on ‘standard pay’ would have been had the individual remained in the home country. The resulting figure will be the individual’s hypothetical tax liability • Deduct the hypothetical tax liability from the individual’s ‘standard pay’ • Add in any allowances to be paid as a result of the assignment. The resulting figure will be the individual’s net assignment pay • Calculate the host country tax due on the net assignment pay. The resulting figure is tax equalisation.

What Are The Potential Complications?

The above steps appear to be relatively straightforward but complications may arise.

Calculating an individual’s tax liability on ‘standard pay’ as if they had remained in the home country may appear easy.

However, you need to consider what income and benefits to include and on what basis to file. For example, if an individual normally pays pension contributions and also has a company car but will not have either whilst on assignment, do you include these in determining hypothetical taxes?

The important thing to remember is that hypothetical taxes are exactly that, hypothetical. They do not represent real taxes payable to a revenue authority.

Therefore, when determining an individual’s home country taxes you can use whatever basis you want and agree with the individual. The key is that all parties must know on what basis the hypothetical tax is calculated and that principles of fairness and equity apply to the calculation. As parties’ memories can be selective and there are no ‘jobs for life’ it is imperative that the basis of the agreement is set out clearly. A tax equalisation policy is extremely useful for documenting the guiding principles that apply, and both the specific mechanics and application of the calculation.

Other issues to consider as part of any policy include the following: • How is spousal/civil partner’s income treated?

• How is investment income and capital gains treated?

• Who benefits from split-year tax treatment?

• What happens when share options are exercised or restrictions are lifted?

• If the individual leaves and joins another company, which does not have tax equalisation, how do you prepare the calculation?

• Do you discourage individuals from acquiring property in the host country?

• What’s the logic behind the deduction of home country taxes if the individual does not have a continuing home country liability or is going to a country with a nil tax rate?

• Who owns the tax credits that may arise from the payment of foreign taxes?

• How much does a company want to get involved with an individual’s personal financial affairs?

In summary, the more issues you consider beforehand, the easier it is to deal with them when they arise at a later date. Also, do remember to review policies regularly as deductions and issues change and the policy can get out of date.

How Does It Work In Practice?

Once the hypothetical tax liability has been determined this amount is deducted from the individual’s pay and represents a contribution to the individual’s tax liability and a reduction in their net pay.

This amount is deducted on a regular basis throughout the assignment.

A company can either try to work out the appropriate hypothetical tax at every relevant stage during the year for example, on each pay rise, or more usually a company can determine an approximate hypothetical liability at the outset of the year and undertake a tax reconciliation at the year-end. Most companies tend to adopt the latter approach. Where they do, the reconciliation will determine whether too much or too little hypothetical tax has been deducted, and whether a payment is required to or from the assignee to the company. Do remember that additional hypothetical tax will reduce the current net pay further. Additionally, any Winter International HR Adviser

25

26

taxing issues hypothetical tax reimbursement may represent extra taxable income.

What About Real Taxes?

As part of the tax equalisation process the individual’s obligation is to pay hypothetical tax to the company. The company’s obligation to the individual is to pay both home and host country actual tax liabilities relating to the assignment. A continuing home country liability may or may not be relevant depending on factors such as domestic legislation, the length of the assignment and continuing ties to the country. If it is relevant the company pays any home country tax due for the assignment period.

In the host country the company pays taxes that arise on all taxable income including assignment related allowances and payments. The assignee does still, of course, need to comply with individual filing requirements and legally the tax liability generally remains the responsibility of the individual.

Managing Reputational Risk Payment of an assignee’s salary in multiple currencies and multiple countries gives rise to the potential for an assignee that is left to their own devices, to file a return somewhat different to the correct position, either through tax evasion or aggressive tax avoidance schemes.

Without tax equalisation such a stance can improve the individual’s net pay.

Either approach exposes the company to financial and reputational risk. After all, the company is usually the static entity in the assignment process whereas individuals come and go both between countries and employments.

One advantage of tax equalisation is that by assuming responsibility for all real taxes the company assists in the tax return process, thus helping to ensure the individual files and files correctly. The company’s reputation and good standing should therefore be preserved.

Tax Planning Tax planning still has a major role to play in determining the structuring of the assignment package and in minimising the tax liability in the host country.

Proper planning may well reduce the tax liability payable by the company.

Companies should therefore look to see for example, whether benefits or cash should be provided, whether payment should be made by the home or host International HR Adviser Winter

entity and whether expatriate allowances are available.

It should be remembered that as the company is paying the individual’s tax on their behalf, this might itself be a taxable benefit. For example, if an individual’s net pay is 60 and the tax rate is 40% the gross pay becomes 100 and the tax 40 (not 24). This is the ‘gross-up calculation’, where tax becomes payable on tax. Using planning to reduce the tax liability has a far greater impact where tax equalisation applies, as there is less to gross up. It is acknowledged that variations on a straightforward gross up calculation can and do apply in different countries.

The cost of tax equalisation can also lead to a variation in the nature of assignments with a trend towards shortterm and commuter assignments and extended ‘business trips’. This needs to be monitored as tax authorities around the world are increasingly focussing on short-term business visitors.

Alternatives To Tax Equalisation Tax equalisation arguably arose as a result of US multinationals sending US nationals on assignment where the individuals had a continuing liability to US tax. The European model tended to be one of tax protection as more often there was no continuing liability to tax in the home country whilst the individual was on assignment.

Tax Protection The principle concerning tax protection is that the employee cannot be worse off from a tax perspective as a result of their assignment. It differs from tax equalisation as under tax protection an individual can be better off and obtain a tax windfall if host country taxes are lower than they would have been without the assignment.

The principle advantages of tax protection are that it can be cheaper for the employer as there may be no gross-up and the individual can be better off.

However, disadvantages can arise, as until the year-end it is not known what the comparative liabilities are until the returns are filed, taxes paid and a reconciliation undertaken. Without advances or loans to pay taxes there can be a negative cash flow for the individual. Additionally, as mentioned above if the individual files their own taxes and they get any tax windfall it may encourage differing attitudes towards tax reduction, including

restructuring performance of their job to their own fiscal advantage or simply failing to report income.

Ad Hoc Policy Some companies decide a formal policy is inappropriate and simply deal with each situation on a case by case basis.

A major drawback to this approach is that each individual seeks to negotiate a better, increased, package. Whilst an ad hoc approach may work for very small expatriate populations, as soon as numbers increase, so do the problems caused by the lack of a coherent policy.

Laissez - Faire On your own! In such cases the employer plays no role in the individual’s tax process and simply pays the individual their gross salary. The individual then files their own tax returns, or not, without company assistance. A number of companies prefer this approach, as it is simpler and cheaper from a compliance perspective to administer.

Drawbacks remain as, for example, both tax planning and actual compliance with tax legislation may not occur.

Naturally there are many additional issues associated with tax equalisation, which cannot be covered within this article. Many of the issues are not tax centred but focus on a company’s philosophy towards its international assignee population.

Whilst tax equalisation has attracted criticism in recent years, notwithstanding this, for the global employer wanting international mobility and fairness and equity for its international assignees, tax equalisation has many advantages and will remain with us for the foreseeable future.

Andrew Bailey is national head of human capital at BDO LLP. He has over 30 years’ experience in the field of expatriate taxation. BDO has offices in 151 countries and 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

Autumn  International HR Adviser

28

GLOBAL taxation

Global Taxation Update Country agreements with the US regarding reporting of income for US individuals.

Barbados FACTA Agreement Signed With The US Barbados and the US have signed an agreement to provide information in accordance with the Foreign Account Tax Compliance Act (FATCA). FACTA introduces reporting requirements for foreign financial institutions with respect to certain accounts held by US taxpayers.

Estonia Estonia Approves Tax Information Exchange Bill Based On FACTA With The US The Estonian government has approved a tax information exchange bill with the US. The bill aligns Estonian laws with the FATCA agreement.

Hong Kong Agreement Based On FACTA Signed Hong Kong and the US have signed an intergovernmental agreement to assist with FACTA. The agreement requires Hong Kong financial institutions to register under the law and negotiate separate, individual agreements with the Internal Revenue Service to share information on their US account holders.

The first round of reporting starts in March 2015.

BDO’s Comment The US is determined to ensure that its taxpayers are actually paying US tax on all relevant income and the legislation seeks to achieve this by imposing strict requirements on financial institutions dealing with US clients. A number of countries have already signed FACTA agreements with the US and more will do so. However, many non US financial institutions are now turning away business from US individuals due to the onerous reporting requirements imposed by FACTA. Opening bank and investment accounts outside of the US can often be problematic for US individuals.

Denmark Personal Allowances When Working Abroad Approximately one year ago, the Danish International HR Adviser Winter

tax authorities stated that a new way of administering the personal allowance when calculating Danish taxes would be introduced. The change was initiated by the European Commission, who approached the Danish government in the spring of 2013 and advised that in their opinion, Denmark was not in compliance with EU law due to the way the personal allowance was determined when calculating Danish taxes.

The personal allowance reduces Danish taxes. It is automatically applied during the tax calculation but due to the way the Danish tax calculation is performed, certain Danish resident individuals working abroad part of the year have not benefited completely from the personal allowance. According to the European Commission, this constituted a restriction of the unlimited movement of individuals, labour and capital.

The Danish tax authorities have now adjusted their IT systems in order to comply with EU law and the affected individuals should automatically receive new statements of taxable income reflecting the changes for 2010, 2011, 2012 and 2013 if applicable.

The amended way Danish taxes are calculated now benefits certain Danish resident individuals who are working abroad.

• Personal income tax deductions • Tax deductions for mortgage interest paid on the mortgage to buy the first and main residence.

With effect from 1 January 2015, the option for non-residents to be treated as Dutch residents will be removed and legislation for ‘qualifying foreign taxpayers’ will be introduced. If a person lives in an EU country, Liechtenstein, Norway, Iceland, Switzerland, Bonaire, Sint-Eustatius or Saba and pays taxes in the Netherlands on more than 90% of his worldwide income, this person will be regarded as a ‘qualifying foreign taxpayer’. A qualifying taxpayer is entitled to the same deductible items, tax credits and tax-free allowance as residents of the Netherlands. If a person does not meet all conditions, for example because he pays taxes in the Netherlands on less than 90% of his worldwide income, it will no longer possible to opt for resident taxpayer status in the Netherlands.

BDO’s Comment Affected individuals should review revised statements of income to determine whether the tax changes have been correctly applied.

Refunds of tax may be due.

Dutch Pension Changes In 2015 With effect from 1 January 2015 the Dutch tax rules for pension schemes will change with reductions in the maximum pension allowed and also the maximum pensionable salary.

In a defined benefit scheme the maximum allowed pension rate is currently 2.15% of the pensionable salary for an average pay scheme and 1.9% for a final pay scheme. From 1 January 2015, the maximum allowed pension rates will be lowered by about 13%. The rates are based on the fact that a maximum pension can be accrued at 75% of the average earned wage in 40 years of service. The new pension rate for an average pay scheme will be 1.875% and the new pension rate for a final pay scheme will be 1.657%.

The percentages for the defined contribution scheme will be decreased in the same way, because the percentages of the defined contribution scheme are derived from the defined benefit scheme

Netherlands Deemed Dutch Residency Option Will Be Removed In the Netherlands resident taxpayers are taxed on their worldwide income wherever earned. Dutch non-residents taxpayers are only taxed on specific sources of Dutch income. Up until 1 January 2015, it is possible for nonresident taxpayers in the Netherlands to opt to be treated as a deemed resident.

The deemed resident taxpayer is treated as if he is a Dutch resident taxpayer and is taxable on his worldwide income. Unlike Dutch non-resident taxpayers, deemed resident taxpayers can enjoy the benefits of actual resident taxpayers such as: • Income tax rebates

BDO’s Comment Do check affected individuals who previously were treated as deemed Dutch residents to see whether they fall within the new definition of qualifying foreign taxpayers and let those who won’t know about the potential tax impact.

global taxation from both employer and employee.

According to Dutch legislation pension contributions are tax exempt, whilst pension benefits are taxed. From 1 January 2015, the maximum pensionable salary for a qualifying exempt pension will be set at EUR 100,000. However, it is possible to accrue pension for a salary in excess of EUR 100.000 through a net pension agreement. The premium contributions of a net pension agreement are paid from the net salary so there is no tax relief for the premiums, however, future payments will be exempt from taxation. Additionally, the accrued value will not be subject to wealth tax (currently 1.2% of the value).

BDO’s Comment Do review the position of pension scheme members to see how they will be affected by the new rules and whether alternative planning is possible.

Switzerland Switzerland Indicates Willingness To Join In With Automatic Exchange Of Tax Information The Swiss Federal Council has agreed that Switzerland will join the global framework developed by the OECD (Organisation for Economic Cooperation and Development) that allows automatic exchange of tax information between countries.

Over 50 countries have now signed the Multilateral Competent Authority Agreement that will assist in plans to provide automatic exchange of financial information in tax matters from 2018.

BDO’s Comment Switzerland has long been viewed as a tax haven and any steps that provide quicker, automatic, exchange of tax information will be welcomed by global tax authorities.

Swiss Population Vote Against Abolition Of Lump Sum Taxation The countrywide initiative ‘Stop the tax privileges for millionaires (abolition of lumpsum taxation)’ was rejected in November 2014. This initiative aimed to scrap the system of charging foreign residents with no gainful activity in Switzerland a lump sum based on their living expenses as opposed to taxing assets and income.

The lump sum taxation policy has helped make Switzerland a popular home for the wealthy foreigners and discarding the system could have been the latest

threat to Switzerland’s internationally competitive tax system.

The poll showed that 59.2% of the population rejected the initiative, launched by the Social Democratic Party (Alternativen Liste – AL). Only the population of the Canton Schaffhausen voted in favour of abolition with 50.8% voting yes. However, this canton is one of five that has already abolished lump sum taxation the others being the Cantons of Zurich, Basel City, Basel Country and Appenzell Outer Rhodes.

BDO’s Comment Lump sum taxation (forfeit) is clearly an emotive subject in Switzerland and its application will continue to be kept under scrutiny by the tax authorities, taxpayers and voters.

Spain Inheritance And Gift Tax Legislation In Breach Of EU Rules In September 2014, the EU Court of Justice ruled that the Spanish inheritance and gift tax legislation is in breach of the free movement of capital provided for in Article 63 of the Treaty on the Functioning of the European Union (‘TFEU’) and Article 40 of the Agreement on the European Economic Area (‘EEA’) – applicable to Iceland, Liechtenstein and Norway. The judgment grants legal support for challenging multiple inheritance and gift tax returns that have been filed in the past and offers the possibility of claiming a tax refund.

BDO’s Comment Individuals who have paid inheritance and gift tax in Spain in recent years should now check whether refunds of tax are possible.

Sweden Budget Statement For 2015 The Budget for 2015 was presented to the parliament in October 2014. The budget includes, among other things, the following suggestions to come into force by 1 January 2015: • Reduced (and from 2016 abolished) reduction in social security contributions for young people • Reduced (and from 2016 abolished) tax deduction for pension savings • Phasing out of the in-work tax credit (jobbskatteavdraget) • Restriction on the upward adjustment of the threshold for state income tax

• Changes in the system for tax relief for domestic services (RUT).

The Ministry of Finance published an English version of the budget statement on their website in November 2014, http://www.regeringen.se/sb/d/18191/ a/248347 Social Security Agreement Between Sweden And India Effective From 1 August 2014 A social security agreement between Sweden and India came into force on 1 August 2014. The agreement covers pension benefits and implies that an employee posted from India to Sweden or from Sweden to India should be covered by the home country pension benefits if the assignment is anticipated to last for more than 12 months and a maximum of 24 months. An extension to be covered by the home country social security system for another 24 months is possible. This is however, only feasible in certain circumstances and requires that the authorities in both states have agreed that the assignee should be covered by the home country social security system for another 24 months. Hence, an employee can be covered by home country pension benefits for a maximum of 48 months.

The social security agreement only covers pension benefits such as public old-age, survivors’ and disability pension.

Since the agreement only covers these pension benefits other social security benefits may have to be reported and paid in the country where the work is carried out. This implies that a Swedish employee posted to India for an anticipated period up to 24 months should be covered by the pension part of the Swedish social security system and that the Swedish employer should report and pay social security fees in India for other social security benefits in accordance with Indian rules. The same system applies for Indian employers posting Indian employees to Sweden.

The social security agreement should also apply to postings that commenced before 1 August 2014.

Implications Of The Social Security Agreement From A Swedish Perspective The social security rate in Sweden is 31.42% on an employee’s gross remuneration. There is no cap for the amount to be paid and the full rate is the employer’s liability. Sweden does not apply employee social security charges.

From a Swedish perspective the social Winter International HR Adviser

29

30

GLOBAL taxation security agreement with India implies that an individual on assignment to India for a period of 12 months or less should be fully covered by Swedish social security during the assignment. Hence, 31.42% of the gross remuneration should be reported and paid as Swedish social security in Sweden.

If the assignment is anticipated to last for a longer period than 12 months but less than 24 months, Swedish social security charges of 23.36% (including payroll tax) of the gross remuneration should be paid.

If an Indian employee is assigned from India to Sweden for a period shorter than 12 months, no social security should be paid in Sweden. If the assignment is anticipated to last for a longer period than 12 months but less than 24 months, Swedish social security of 8.06% of the gross remuneration should be paid in Sweden, based on the assumption that the Indian employer does not have a permanent establishment in Sweden.

The Swedish Tax Agency’s Standpoint As a result of the social security agreement with India, the Swedish Tax Agency has published a standpoint regarding Swedish employers’ obligation to pay payroll tax on any remuneration paid to employees on assignment. A published standpoint is the Swedish Tax Agency’s interpretation of Swedish legislation. In order to challenge the Swedish Tax Agency’s standpoint it would have to be tested in Court.

The payroll tax is 9.88% (out of the full social security fee of 31.42%).

Payroll tax is paid by Swedish employers and foreign employers with a permanent establishment in Sweden.

Previous Swedish practice has implied that payroll tax has been paid on remuneration to Swedish employees on assignments covered by the social security convention for EU/EEA. Swedish employees on assignment to the US or Canada covered by the social security conventions with the US, Canada or Quebec are only partly covered by the Swedish social security system including public old-age, survivors’ and disability pension. Payroll tax has previously not been due in cases where a Swedish employee is assigned to a country where he/she is partly covered by the Swedish social security system. This approach has been the applicable practice in Sweden until now.

International HR Adviser Winter

The Swedish Tax Agency’s current opinion is that all employers posting employees to other countries should pay payroll tax on any remuneration. Hence, the former practice no longer applies according to the Swedish Tax Agency’s standpoint and Swedish employers posting employees partly covered by the Swedish social security system should pay social security charges of 23.36% instead of 13.48%. This is applicable for employers/employees under the Sweden/ India agreement from the beginning of the assignment period and from 1 January 2015 for employers/employees under any of the conventions with the US, Canada or Quebec.

BDO’s Comment Employers and employees should review how these changes will affect them.

India is seeking to implement social security agreements with a number of countries so do keep the position under review where you have assignees moving to/from India.

UK Autumn Statement Proposed Changes To The Remittance Basis For Long Term Resident But Non UK Domiciled Individuals Individuals who are resident in the UK but who are not domiciled, have the option to be taxed in the UK on their overseas income that they bring into the UK country rather than simply being taxed on their worldwide income, as is the case with UK nationals. Once such ‘nondoms’ have been resident in the UK for more than seven out of the last nine tax years, they must pay an annual charge of £30,000 for this beneficial treatment.

Non-doms who have been resident in the UK for 12 of the last 14 tax years must pay a charge of £50,000, but this annual charge is to rise to £60,000. There is also to be a further level of charge, set at £90,000, for such individuals who have been resident in the UK for 17 of the last 20 tax years. These changes are expected to take effect from 6 April 2015, but this is yet to be confirmed. At present, non-doms must elect to pay these charges on a yearly basis and can therefore arrange their affairs to minimise the charges they pay, but the Government is to consult on requiring the election to apply for at least three years.

BDO’s Comment Individuals should ensure they review the number of years of tax residence in

the UK and are aware of the financial impact of either applying the arising or remittance basis. HM Revenue & Customs is increasingly reviewing declared years of UK tax residence and particularly the individual’s circumstances in and around their selfassessed ‘date of arrival’ in the UK. Prepared by BDO LLP. For further information please contact Andrew Bailey on +44 (0)207 893 2946 or at andrew.bailey@bdo.co.uk

FREE TAX SEMINAR Monday 2nd February 2015 at 12.30pm

US Tax Updates And Overview Of The US/UK Tax Treaty For US Persons Residing In The UK This seminar will cover US tax updates for 2014 and any 2015, as well as interaction of the UK and US tax treaty and how this affects US persons living in the UK. Hosted by BDO LLP

To reserve your place in this free seminar please email: helen@internationalhradviser.com

The 2015 Corporate Relocation Conference & Exhibition Hotel Russell, Russell Square, Bloomsbury, London, WC1B 5BE

32

SERVICED APARTMENTS

‘Mind The Gap’ Hospitality, Services And Deliverables In The Serviced Apartment Industry The Serviced Apartment Industry consists of an interesting mix of hotel operators, entrepreneurs and property people.

This heady mix of leadership has created an arena that is passionate, fast paced, competitive and above all, never dull...

Defining what is a ‘serviced apartment’, and what is the true deliverable of this accommodation solution remains at the table for discussion as the industry matures, this is an opportunity to further demystify our products and our services that we provide every day across all continents to our bookers, buyers and guests.

At the centre of our world, the hotel operators that have entered the serviced apartment segment are every day striving to bring hospitality to the forefront of the experience, but how can a serviced apartment provider really show ‘true’ hospitality to arriving assignees and guests in a world where the majority of arrivals are into buildings without a reception (or restaurant) facility? And how are serviced apartments operators defining their products and services in this competitive marketplace?

Deciphering the ‘solid’ deliverables in the industry, both now and for the future, helps us to understand exactly where are our ‘gaps’ are, and gives us the opportunity to understand what the individual operators, associations and organisations are doing to fill them.

The definition of hospitality, in its purest form, is ‘the friendly and generous reception and entertainment of guests, visitors or strangers’.

As the majority of serviced apartment bookers and guests are fully aware, in a great number of cases, the arrival process into a serviced apartment for an assignee and their family is not always a warm and fuzzy one.

The reality is often a late arrival into an unnamed apartment block, entry is via a key-pad on the outside of the building and keys are collected from a safe in the lobby.

On entering the apartment, the ‘welcome’ is provided by the ritual thumbing through of the information folder that is strategically placed on the coffee table, and the entertainment is flicking through (sometimes limited) TV channels that may, International HR Adviser Winter

or may not be, in their own language.

Although this model can seem a little bereft of personal service, let’s be honest, there really is absolutely nothing wrong with this arrival at all. This ‘light’ touch experience keeps costs to a minimum, and your traveller immediately ‘lives like a local’.

The industry associations would confirm that one of the biggest issues that an operator of serviced apartments or corporate housing companies face daily is key delivery. And if an operator can ensure that your traveller has been able to gain ‘safe entry’ into their apartment, then they have won half the battle. The other half is ensuring that they can get online, but that’s a whole other story…

But where is the hospitality? And can operators that have this model in their business really say that they are in ‘the hospitality’ industry?

One view is that serviced apartment operators are trying to ‘jump’ on the bandwagon of hotels, who can quite easily offer hospitality via a welcome desk, 24hr check-in with a ‘live’ guest service associate (hopefully one that is warm and friendly), and as for entertainment, the provision of on demand movies in your room, a bar, and in most cases a restaurant, helps to secure the definition.

It is interesting how different serviced apartment operators define hospitality, especially when it is part of their brand name.

Two large global operators have the word ‘hospitality’ in their name - one however, doesn’t operate the corporate housing model and all of their products do have a front desk, which enables provision for a friendly welcome - The other operator, however, does boast three brands that do not have receptions or provide any other managed facilities on site, so how are they defining their brand ‘hospitality’ and their warm welcome?

An extended stay product, an aparthotel or residence (generally) has a front desk, and is also the nearest in our industry in reflecting the services of a fully loaded hotel.

It looks to host guests that intend to stay from 5 to 30 days and they see themselves as the ‘stepping stone’ from a hotel to a full ‘serviced apartment’ product – this

model is also the first choice for a business traveller in a new location, especially one that doesn’t want a totally independent experience and it also provides the transition model into a city before moving into a permanent accommodation.

These extended stay products are pretty easy to offer ‘hospitality’ and this is shown in the multitude of services provided by, for instance, the Staybridge brand which includes complimentary breakfast, access to ‘The Pantry’, a fully functional frontdesk and social evening receptions.

Serviced apartments and corporate housing operators use many solutions to overcome the hospitality ‘voids’.

Roomspace, a European operator, offers a meet and greet service for every arrival included in their rate. This helps them to make their welcome ‘stand out from the crowd’. This complimentary service added to a welcome beverage tray, a welcome call or email to the assignee 24 hours into their stay and 24 hour ‘out of hour’ emergency and guest services helps to fill this gap.

The one thing we know for sure, is that this conundrum, which is faced by virtually every serviced apartment operator on the planet, is at the top of the agenda. Many operators have found great ways to ensure a warm and friendly welcome and have placed hospitality at the core of their business.

Having spent a great deal of time travelling the world and experiencing the best (and worst) hospitality at every level, it is obvious that people make the difference, whether face to face or virtual.

Large and small organisations understand that behind every ‘act of hospitality’ is an associate that makes it happen. The key is in ensuring that operators or agent’s teams, companies and individuals make a difference every day (and on every arrival) for all guests – this is critical. A major error to note is that it is very easy to set a high standard for the first arrival of a guest (i.e.

VIP gifts on their first arrival) and then completely drop the ball on the second visit. Consistency is vital.

Creating the perfect serviced apartment experience has to include all of the service

SERVICED APARTMENTS elements that makes a guest feel like a million dollars, on every visit – for this, operators cannot just rely on their staff to ‘know’ what to do, they have to set standards, they have to ensure that they are adhered to, and they have to audit them – of course, recruiting the right staff in the first instance does win half the battle.

So what are the other potential GAP’s in your assignees stay? We’ve covered arrival, we’ve covered off hospitality and friendliness, the other main areas would be everything in working order, health & safety, security and cleanliness.

The Association of Serviced Apartment Providers (ASAP) has been working hard to deliver an excellent quality grading programme that is being mirrored globally by other serviced apartment organisations, and this process is being reviewed currently by the CHPA (Corporate Housing Providers Association) in America. To date, over 90% of the ASAP membership has been through their first inspection.

This drive for more ‘consistency’ and service has been supported and celebrated by most of the booking agents connected with ASAP including SACO, Citybase and The Apartment Service, who all trust and rely on their supply chain to deliver

the best possible stays for their clients.

Duty of care, health and safety and ensuring that assignees are supported by robust issue resolution and ‘out of hours’ emergency support is paramount to every company. Checking that your agent or supplier of serviced apartments has this in place, creates a level of confidence that even if something does go wrong with a stay, your traveller is in safe hands.

The arrival and popularity of companies that occupy the space with Airbnb and 9flats is already creating a new disruption in the accommodation space. This fast adopted reality of being hosted in a boutique private apartment (or house share) at a very competitive rate seems attractive, but for the corporate and relocation buyer, this is creating a whole new level of challenge with a view to traveller tracking, safety and security and payment facilities and above all, there is limited consistency, standards, KPI’s or SLA’s to support this assignee experience.

It is amazing that the question ‘what is a serviced apartment?’ remains on the agenda of most groups, organisations and associations.

Going back to the very first formal meeting of the ASAP (the Association of Serviced Apartment Providers), over 11 years ago, this

was the first question that the membership of 12 operators tried to answer, and it continues to be on the agenda for the thought leadership group of the serviced apartment summit in 2014. The last four editions of the GSAIR (Global Serviced Apartment Industry Report) has provided a definition in every edition, but still, the discussion continues.

You may wonder what causes the confusion, and many have their opinions, mine is that the industry is still developing its personality and until the services have fully defined, and the larger brands have aligned the basics of product and services, this (possibly perceived) gap in deliverables will continue to exist.

Jo Layton, MD Group Commercial Sales, The Apartment Service. Jo Layton has joined The Apartment Service as Managing Director – Group Commercial Sales.

She has successfully established The Apartment Service’s new Alliance brand as part of her overall remit to develop the company’s successful agency, network and Roomspace brands. Layton joined from BridgeStreet where she was responsible for sales and marketing throughout EMEA and APAC and was instrumental in the expansion of the UK office. www.apartmentservice.com

Winter International HR Adviser

33

34

Health

Businesses In Crisis: Perspectives On Ebola Outbreaks - Past, Present And Future Finding your business in the midst of a crisis, such as the current Ebola outbreak in West Africa, presents many problems which HR professionals are tasked with solving. Issues surrounding the protection of the worker not only have effects simply on organisational staffing, but on morale and culture, all ultimately influencing the bottom line.

And what a devastating crisis it is.

Thousands of individuals have been infected, at least half of them fatally so.

Healthcare provision, sketchy to begin with, is overburdened and failing. A climate of fear and uncertainty pervades, provoked in part by the occasional hyperbole of the Press.

Personnel Planning Local healthcare provision in resourcepoor contexts is often difficult and is only appropriate for the most minor of medical conditions or, somewhat paradoxically, the emergency stabilisation of an acutely unwell patient whilst an air ambulance is en route. This is when things are good.

During an epidemic, when there are many more hospitalised patients, these slim services become over-stretched.

Added to this is that during this present crisis, Ebola has been particularly perilous for healthcare workers, infecting many hundreds of medical professionals. Just being an inpatient can put the individual at greater risk of acquiring the virus.

It is clear that any significant preexisting medical issue which is routinely treated in the West, such as unstable angina or even a duodenal ulcer, may become untreatable and possibly lifethreatening in this context. When selecting staff to be deployed to epidemic areas, a thorough medical assessment of the employee should occur before clearance to go is given. In fact, such a review should occur for all staff in the field. This may lead to the temporary redeployment of an individual away from the affected countries, but as the consequences for that individual (if they were to become ill and untreated) and the company (in failing to provide a duty International HR Adviser Winter

of care) are potentially serious, it is a regrettable necessity.

Personnel Protection A natural reaction to finding oneself working in a country gripped by an epidemic is fear and uncertainty. Effects on work are inevitable, especially perhaps if loved-ones are also perceived as being at risk. These fears can be lessened significantly by effective HR management, however. By disseminating specialist medical information and advice, an accurate assessment of the present risks can be made, steps taken to reduce them further, and fears allayed.

In the case of Ebola, for example, the experience of the previous 20 or so outbreaks has shown that those at risk from catching the virus from other humans fall into 3 groups: family, funerals and failures of personal protective equipment (PPE).

Family: in local families, a sick individual would be cared for by another family member, often female. She would then acquire the virus by close contact with infected bodily secretions. In previous outbreaks, this was fuelled by a lack of understanding of how the disease was spread and mistrust of the available health services, leading to home-care. Funerals: customary funeral practices involving contact with the deceased have been responsible for the majority of virus transmission in Guinea, for example. Failures of PPE: more than 500 healthcare workers have been infected with Ebola, resulting in hundreds of fatalities. PPE is the combination of gowns, gloves and masks which aim to protect the medical professional from contact with a patient’s bodily fluids, thereby protecting them from infection.

Evidently, the above contexts do not fit easily with the daily experiences of the expat worker. The remaining method of infection is directly from the source – the fruit bat.

In an important sense, Ebola’s natural habitat is the fruit bat. They live at ease with each other – the bat not being particularly affected by the infection and living a normal life-span. This is ideal for the virus, as the symptomless bat has time

to pass it on to other fruit bats, aiding transmission. When Ebola crosses from the fruit bat to other animals such as a forest antelope, or - of course - human, it is a very different story. Disastrous consequences occur. Destruction of the immune system results. Catastrophic inflammation occurs, leading to multiorgan failure. As the blood’s clotting factors become exhausted, haemorrhaging ensues which often presages death.

Individuals then can also acquire this terrible disease directly from infected animals – such as has occurred in previous outbreaks by the local practice of consuming ‘bush’ meat. This is something that the expatriate is not likely to do, however. It can be seen that an HR professional, in conjunction with the guidance of a medical specialist organisation, would be able to reassure their employees that the risk of catching Ebola is low by informing them of the facts and advising specific precautions.

For example, what are of particular importance are precautions for diseases which can be mistaken for Ebola. As the illness presents initially with flu-like symptoms, abdominal pain and diarrhoea, this can be confused with a range of much more common ‘tropical’ illnesses – arguably the most important being malaria. Expatriates who become infected with malaria are subject to its most serious consequences, as they have not built up a partial immunity to the organism which the local population have often acquired. Cerebral malaria, for instance, can be fatal and must be treated promptly, necessitating hospital admission. The problem is that the initial stages of malaria are clinically indistinguishable from Ebola and local hospitals will not admit such a patient without a negative Ebola test.

Furthermore, if a patient is repatriated by emergency air ambulance, the evacuation company would also require a negative test for the virus before the plane takes off.

However, as Ebola tests are becoming more easily and quickly available in the field as international efforts increase, this situation is becoming somewhat

Health easier - but far better would be to avoid the malaria, or similar diseases, in the first place. Precautions such as taking antimalarials, using a DEET containing spray, sleeping under nets, wearing long sleeved clothes and trousers are important – as are ensuring water safety and washing hands regularly. Such information to employees can clearly be life-saving.

Contingency Planning Measures such as community education, contact tracing and quarantining have been reliably effective in controlling previous outbreaks. Following growing international presence in the field, there are early indications that this may be also starting to occur in West Africa.

When this epidemic is finally controlled, pertinent questions for HR professionals will be: what is the risk that an outbreak will occur again, what are its likely characteristics and what contingency planning will be necessary?

Regrettably the evidence from previous epidemics strongly suggests that another epidemic will occur. The 21 previous outbreaks have occurred in only 5 countries, with at least 3 outbreaks occurring in each - the second outbreak

often following only a few years after the first. In fact, a paper published this year shows that isolated undiagnosed Ebola cases were present in West Africa as far back as 20061. This current epidemic is not the first incidence of Ebola in the region but the first that was known about.

The message is clear: it has happened before, it will happen again.

What is better news, however, is that the previous outbreak numbers were far smaller than those presently seen in West Africa. This has led some commentators to suggest that the chief reason for the size of the current epidemic was due to the fact that it occurred over several country borders delaying the realisation that an epidemic was starting. With proper surveillance of cases, improved testing and the knowledge that Ebola is present in West Africa, subsequent outbreaks should be smaller. What are the likely effects of a future, smaller outbreak of Ebola? Given the global publicity and progression of this present epidemic, it is likely that affected countries will suffer similar infrastructural changes – just at an earlier stage. Airlines are still likely to cease services, travel be limited, healthcare inundated, fear and uncertainty resurface. The need for

contingency planning seems not only crucial to organisational function but to the affected countries’ welfare as a whole.

Crises of some sort are inevitable. With appropriate advice, HR professionals can not only lead the way in weathering the storm, but ensure the welfare of the workforce and plan to be better prepared for when subsequent squalls arise.

Reference: 1 Undiagnosed Acute Viral Febrile Illness, Sierra Leone. RJ Schoepp et al. Emerging Infectious Diseases. 2014. 20, (7), 1176-1182.

Dr Simon Worrell, BSc MBBS MRCP is Head of Medical Communications at Healix International.

Healix International is a global leader in international medical, security and travel assistance services working on behalf of multinational corporations, governments, NGO’s and insurers across the globe. They also provide employers with international occupational health, pre-deployment medical screening and pandemic planning services.

To find out more, visit www.healix-international.com, email enquiries@healix.com or phone +44 (0)20 481 7720.

Winter International HR Adviser

35

36

Education

If Your Employees Won’t Go To Hardship Countries Because Of Their Children’s Education, Then Online IB Education Options May Be The Answer How Is Education Changing – What Does The Future Hold?

It’s not easy to predict the way that schools and colleges will operate in the future but what is sure is that change is coming. Looking back 100 years, classrooms were essentially the same then as they are now – the teacher stands at the front and shares knowledge that is prescribed by the school or the examination board. The students accept what they are told, they master the basics, recall the facts and give the answers that are expected in the way they have been drilled. Schools still mostly operate from 8.30am to 3.30pm for about 38 weeks a year, and no-one can really explain why there is still a six or eight week summer holiday when finding childcare is expensive for working families and when there is no need for child labour to help to bring in the harvest!

Of course that is the extreme picture. Schools as facilities today would be unrecognisable to the likes of Thomas Gradgrind, the Headmaster in ‘Hard Times’ by Charles Dickens.

In the UK, thanks to the Building Schools for the Future initiative, some school buildings resemble five star hotels or up-market corporate offices with light, airy open spaces, clean bright furniture and modern design.

Rooms are connected with interactive whiteboards, Wi-Fi and laptops, and iPads seem to be everywhere.

There is a realisation that the format of education needs to be modernised too. The increasing demands of the 21st century with exponential technological innovation and rapid globalisation present us with a future that is hard to imagine. In the YouTube video on the progression of information technology researched by Karl Fisch called ‘Did You Know?’ (www.youtube.com/ watch?v=YmwwrGV_aiE) the thesis is International HR Adviser Winter

proposed that ‘we are currently preparing students for jobs that don’t yet exist, using technologies that haven’t yet been invented, in order to solve problems that we don’t even know are problems yet.’ If we look at the speed of the introduction accessibility and availability of mobile phones, the internet, personal computers, devices and social media, is there any doubt about the rate of advancement of technology?

So what matters? To be literate and numerate will always be the first priority closely followed by being computer literate and to be able to use technology in an agile and creative way. Students will need to be better critical thinkers, out of the box problem solvers, able to research individually, asking the right questions and verifying the evidence and they will need to collaborate locally, internationally and interculturally. They will need to be able to explain, reflect on and rationalise their learning and to be creative, and of course, it will be an advantage if they are proficient in more than one language! How do you implement a curriculum and measure that kind of learning?

The International Baccalaureate (IB) founded in 1968 provides one way forward in providing educational programmes that recognise individuality, contemporary issues and global cooperation. That is exemplified in their mission statement: 'The International Baccalaureate aims to develop inquiring, knowledgeable and caring young people who help to create a better and more peaceful world through intercultural understanding and respect'.

To this end the organisation works with schools, governments and international organisations to develop challenging programmes of international education and rigorous assessment.

These programmes encourage students

across the world to become active, compassionate and lifelong learners who understand that other people, with their differences, can also be right.

Around the world the number of IB schools is increasing with over 3,965 schools in 147 countries that are developing and offering four challenging programmes to over 1,240,000 students aged from 3 to 19 years. Universities around the world understand that IB students are strong independent learners and they are actively encouraging their applications.

During the last few years the IB has taken a step forward in offering some of the IB Diploma courses taken by 16 to 18 years olds as online options.

With universities opening up so much of their course content to learners there is now an emerging trend for online participation in education. Universities have things called MOOCS - ‘massive open online courses’. MOOCs provide interactive user forums that help build a community for students, professors, and teaching assistants, and one of the most recent examples has been that developed by Google with Open edX. Imagine being able to study a course for free that is being offered by Stanford, MIT or Harvard University or at any of the UK or worldwide universities now sharing their courses. The phenomenon has been described as "a digital tsunami", threatening to sweep aside conventional university education.

The IB is now working with seven pilot schools around the world and Dwight School London is currently the only one in the UK accredited as an Open World School. Students in the Sixth Form there have the option of selecting one IB Diploma course which they can study online. They work in virtual, global classrooms with their classmates and teacher spread out across the world. The advantages

Education for motivated students are many – they are able to take on a subject not normally offered in their own school; they can work largely at their own pace joining discussions and blogs with students who have many different perspectives and experiences, and they can use the technology that they are very familiar with. The IB is opening up this opportunity to all students from around the world. Already many schools have interactive websites with student portals where work is set, submitted, discussed and marked and this is a style and approach that will surely continue to expand and grow.

It is interesting to look at the work of Sugata Mitra, Professor of Educational Technology at the School of Education, Communication and Language Sciences at Newcastle University, England. He is best known for his ‘Hole in the Wall’ experiments that demonstrated that groups of young people, irrespective of who or where they are, could learn to use computers and the Internet on their own with

public computers in open spaces, such as roads and playgrounds, even without knowing English. He suggests that the days are gone where the teacher is the fount of all knowledge and he proposes that schools, as we know them, are heading for redundancy, except that is, for being places to teach young people how to socialise, to persevere, to care

and behave, and most importantly to question and learn.

Change may come slowly but as the older generation of teachers are replaced by those for whom technology, innovation and devices are the norm, it is clear that schools, classrooms and learning will be very different to what we recognise now.

David Rose has been Head of School at Dwight School London since 2005. He has taught in Sweden, Pakistan, the UK and Cyprus and has also been Headmaster at schools in Germany and the US. In 2008 David led the development and foundation of The Holmewood School London, a school that specialises in supporting international and local children who have complex educational needs.

David is an Independent Schools Inspector and is a member of the Dwight Schools Board responsible for schools in New York, Seoul, Shanghai and Vancouver Island.

Dwight School London, 6 Friern Barnet Lane, London, N11 3LX Telephone: +44 (0) 20 8920 0632 Website: www.dwightlondon.org

Winter International HR Adviser

37

38

Diversity & Inclusion

Five Ways To Build Global Support For Diversity And Inclusion The diversity and inclusion (D&I) debate has long raged in the HR arena.

It’s fair to say that professionals across the board recognise the need to create a culture that is conducive to D&I, yet there is still a lack of hard evidence to demonstrate that real progress has been made. For example, according to a recent report by Bloomberg News, only 17% of directorships in the UK at FTSE 100 companies are held by women and, on average, females are paid up to £5000 less per year than their male counterparts.

Clearly there is still plenty of room for improvement. But, what is the solution?

With the aim of moving this issue forward, Cielo recently held a roundtable event to assess the future of D&I and what industry leaders are doing to foster change. The event saw senior HRDs from global organisations share insights on how to address the issue.

What became very evident at the event was that very few businesses are as far along on the D&I agenda as many would perhaps hope to be. When considering where they felt their company was in the transition model outlined by workplace diversity consultant, More2Gain, none of those in attendance positioned themselves right at the top of the scale. In the five stages laid out in this model – which categorises organisations from ‘Asleep’ to ‘Alive’ – many leaders felt they were in the ‘Awake’ stage, whereby leadership teams recognised the business benefits of a D&I culture, but strategies to deliver one were yet to be fully integrated across the business.

So how can HR professionals move their organisation along this model to the top end of the spectrum? According to the delegates, there is a five-step approach which will really help progression: • Create Diversity “Nudges” - Encourage managers to include a specific target group in recruitment strategies through tailored talent-pipelining – for example, female-specific segments. Further, consider urging front-line managers to include at least one member of a target group on each hiring shortlist. This approach of regularly exposing hiring International HR Adviser Winter

managers to target candidates can be highly educational and improve D&I • Segment Employee Needs - Learn what your employees and target groups really want from you as an employer. Once you truly know your work population, you can then develop flexible and agile strategies that best suit each employee’s needs

challenge that HR will need to address.

As argued by a number of delegates, though, true diversity and inclusion requires a change of thought, behaviour and attitude. The opportunities for competitive advantage are endless, and going from “Asleep” to “Alive” begins with that first small step.

• Be Flexible - According to a survey conducted by diversity consultancy, Capability Jane, both female and male professionals seek flexibility with regard to work schedules and benefits. Flexibility can include working part-time, remotely or simply having more control over daily work schedules • Be Authentic - Creating a diverse workforce and inclusive culture demands an employer value proposition that is authentic and accountable, and promoted via the right channels.

Communicating it effectively will call for partnerships with marketing and/or communications departments • Consider the Metrics - Use accessible data in a more imaginative way to build and prove the business case for D&I. Only by measuring, evaluating and communicating the true value of diversity and inclusion strategies can you build the organisation-wide support necessary to incite change.

As one attendee explained, as soon as you think you have one area of D&I under some sort of control, you find another issue to wrestle with, so it’s perhaps no wonder that there is still so much room for improvement. Take for example, the fact that the world’s top business schools have spent the past two decades developing diversity courses for their MBA programmes, with the ultimate aim of creating a new generation of D&I driven business leaders. However, as Désirée van Gorp of Nyenrode Business University in the Netherlands asks: have they merely assembled a group that, despite its range of ethnicities, nationalities and genders, is far from diverse beneath the surface? This issue of ‘authentic’ diversity may be the next big

Sue Brooks Managing Director of Cielo’s Talent Consultancy

FREE SEMINAR Monday 2nd February 2015 at 3.30pm

Employment Disputes And How To Avoid Them To reserve your place in this free seminar please email: helen@internationalhradviser.com

The 2015 Corporate Relocation Conference & Exhibition Hotel Russell, Russell Square, Bloomsbury, London, WC1B 5BE

Autumn  International HR Adviser

Expatriate Adviser Summer

Autumn International HR Adviser

talent & GLOBAL MOBILITY

The Talent And Global Mobility Partnership Traditionally, global mobility has been a transactional service, often part of the Compensation and Benefits area that focuses on process and cost.

But by changing the focus of what global mobility does, the ROI debate moves from a cost equation to one of development and retention. The effective management of assignments supports the talent agenda by ensuring that the right people with the right skills are available to support the business, whilst on assignment and as part of the assignee’s ongoing development.

There is a responsibility for Global Mobility leaders and HR professionals to be proactive and use the greater experience that they have to support the Global Talent Agenda. The word ‘talent’ seems to have become the buzz word for everything HR, so before the link between talent and global mobility can be developed, it’s important to understand what talent actually is in your organisation.

Organisations should be considering recruitment of the ‘best fit’ talent with the right knowledge and experience aligned to their culture and values. It’s important to identify the right talent to progress through the organisation, supported by robust processes. The management of people relies on clear communication channels and development plans that are supported and reviewed on a regular basis. The Talent process can be a robust tool in ensuring that the right people go on assignment under the most appropriate policy.

We are seeing a decline in the traditional expat programme, with many organisations creating new programmes that align with the objectives and future needs of the businesses they serve.

It’s corporate strategic goals that are driving changes in the programmes associated with long-term assignments.

Assignments are increasing in highgrowth markets that are often more challenging assignment locations.

The better linking to larger talent management strategies, means that they are more targeted and critical in purpose and more thought through in terms of cost and support. It is a more mature time for our industry overall.

The human resources department still drives policy for long-term assignments, but the increasing focus on corporate immigration and tax compliance is now moving business travel policies and tracking to sit under the umbrella of Global Mobility programmemes. This is a trend that makes a lot of sense. Business travellers can often unintentionally extend a visit or lose track of having the right visas. Mitigating these risks are critical for an organisation, whether it is a business traveller or an assignee.

The decline in traditional expat programmes reflects the talent agenda, but unlike previously, one size does not fit all, and depending on the needs of the business, the percentage of critical experienced hands versus those being developed to support current and future needs, will vary immensely. For example, organisations within the Natural Resources sector would tend to be more focussed on critical experienced hands instead of businesses developing into emerging markets.

Effective talent management cannot succeed without senior management support and intervention - particularly from the CEO. What’s more, the HR department needs to provide the right tools and processes so that line managers can make informed and consistent decisions, which doesn’t happen overnight.

It’s important that everyone knows what they are doing, why they are doing it, and how it fits into the wider business.

Similarly, with the Global Assignment policy, the talent process needs to be delivered clearly and consistently by HRs. Ultimately, global development plans need a global mind-set.

The challenge HR professionals will face is whether they assign an experienced professional who needs less support and will deliver immediate results, or whether they opt for the leaders of the future who need further development and more support. Development assignees need to be around long enough to see the results of their actions, and their line managers need to be upfront about the reasons behind an assignment, without leaving the assignee to assume they are highly rated and skilled.

The benefits of this approach can be huge. By delivering a talent programmeme, organisations will keep the people they want to keep, which solves the post assignment conundrum.

Having a programmeme in place will ensure the business has a clear focus and that policies are assigned to the business’ needs, as well as ensuring Global Mobility teams have a clearer role which forms part of the strategic HR function. In terms of the assignees, it means they will have clear objective whilst on assignment and gain earlier international exposure at a reduced cost for the organisation.

Peter Sewell is a Regional Director at Crown World Mobility. Peter has a strong track record in developing global mobility policies, processes and strategies. Peter is responsible for overseeing client programmemes and service delivery, implementing group policies, working closely with expatriate tax and other suppliers.

He’s also in charge of reviewing existing local practices and leading project reviews with customers.

Email: psewell@crownww.com For further information about Crown World Mobility’s services, please visit www.crownworldmobility.com Winter International HR Adviser

41

The 2015 Corporate Relocation Conference & Exhibition Monday 2nd February 2015 from 10.00am - 5.00pm Hotel Russell, Russell Square, Bloomsbury, London, WC1B 5BE

FREE SEMINAR PROGRAMME 10.30am - Raising Internationally Mobile Children: Understanding and Nurturing the Third Culture Kid Experience

A significant reason for failure of international assignments revolves around the ‘soft’ issues - the adaptability of families and children. For the majority, when properly understood and managed, the benefits of growing up abroad can far outweigh the challenges. This session for parents and professionals who are working with internationally-mobile families will share research-based insights into how a global experience can enhance future educational and career opportunities for children, and how to manage the stumbling blocks encountered along the way. While parents naturally worry about how moving away from the home culture and language will impact their children, when approached with knowledge and optimism, it can be an enriching life-changing experience.

Presented by Mary Langford whose own international journey began at the age of two, and who has worked with international schools and families as an educator, researcher, writer, speaker, independent consultant and trainer for over 34 years. She is currently Director of Admissions for Dwight London School.

11.30am - Did My Identity Get Lost In The Move?

Once the practicalities of moving are in place, spouses and partners often experience a loss of identity. This can have a serious impact on their personal confidence and daily routine. Helping them with their career search and with building their network can get them on the right path to their new life so they no longer say “Who am I?” Join FOCUS as they explore the key factors that contribute to a successful establishment of a spouse or partner’s new identity.

Presented by FOCUS.

12.30pm - US Tax Updates & Overview Of The US/UK Tax Treaty For US Persons Residing In The UK This seminar will cover tax updates for 2014 and any for 2015, and interaction of the UK and US tax treaty and how this affects US persons living in the UK. Presented by BDO LLP.

1.30pm - Immigration Update

This seminar will be a practical session providing advice on the latest Immigration developments and the implications for businesses, and will cover Immigration Policy Updates, Global Immigration Strategy and Management, Compliance and Risk Management.

Presented by Ferguson Snell & Associates, and if you have an immigration enquiry that you would like Ferguson Snell consultants to cover on the day please email your enquiry in advance to fs@fergusonsnell.co.uk.

2.15pm - Short-Term Business Visitors: Staying Ahead Of The Game

Any global employee is potentially a business traveller, capable of creating tax or immigration obligations in any country in an era of increased scrutiny by tax authorities around the world. For many organisations, defining the size of the population and identifying the relevant individuals is the biggest challenge. We discuss how a data-driven approach utilising the latest analytics techniques coupled with tax and immigration expertise can enable a process to identify, review and propose actions for organisations to help manage business traveller compliance risk efficiently for any size of population.

Furthermore, this data also provides business and mobility leaders the opportunity to pro-actively manage business travel before an issue arises, identify cost reduction opportunities by analysing spend and evaluate adherence to an organisational travel policy.

Presented by Scott McCormick, Partner and Robin Brown, Senior Manager from Deloitte Global Employer Services.

3.30pm - Employment Disputes And How To Avoid Them

This seminar will take a practical look at things assignment managers (and expatriates) can do to reduce the risk of employment disputes.

The discussion will focus on: Common Flashpoints, Managing Expectations, Where Paperwork Can Help (And Where It Can’t), Practical Steps To Avoid Claims, Why Expatriate Claims Are Different, Dispute Resolution Strategies & Things You Could Do Now To Avoid Disputes Later.

Presented by Juliet Carp, Employment Partner, Speechly Bircham LLP.

4.15pm - Expatriate Costs Simplified

The seminar will cover not only how much an expatriate should be paid, but also how much this will cost the business, and also how it should be delivered.

Presented by Total Rewards Group.

If you would like to register for any or all of these free seminars, please email helen@internationalhradviser.com with the times of the seminars you would like to attend.

We look forward to seeing you there!

talent management

The Employer/Employee Relationship In Transition: Navigating The Unwritten Expectations For many years, the workplace relationship was relatively simple. A specific offer of compensation made by an employer was exchanged for the experience, skills, and a specified work product to be provided by an employee. Reinforcing the explicit terms of employ­ment were the implied elements of the relationship, which established a kind of unspoken understanding between the parties.

Hiding in this obscurity was an expectation that, barring extreme circumstances, the relationship would be long-term, ideally developing over time. This inferred component of the relationship served to establish a type of psychological contract between the employer and employee. Writing in the journal, Academy of Management Executive, Denise M. Rousseau defined a psychological contract as beliefs based on promises, expressed or implied, regarding an exchange agreement between an individual and the employing firm and its agents.

In a 2013 World at Work survey, 52% of respondents cited finding, retaining and developing quality talent as their number one business challenge. Although the demand for key talent is greater than ever, external forces driving change in the global economy have influenced a difference in the way companies view employees, and how candidates think about opportunities.

We’ve transitioned from a shared objective of meeting business requirements, to a climate of a more measured, transactional relationship, leaving many employees asking “what’s in it for me?”

In an article entitled TOURS OF DUTY: The New Employer-Employee Compact (Harvard Business Review, June 2013), LinkedIn founder Reid Hoffman and his co-authors address the changing dynamics of the employer/ employee relationship. They address the obsolescence of a conventional relationship characterised by promises of security and loyalty, suggesting that a more contemporary approach to human capital

management is in order. The proposed new employer-employee compact provides for a shorter-term tour of duty, that is established to serve a specified purpose, and for a defined period of time.

Rather than solely focusing on business requirements, a tour of duty approach takes into account company needs, as well as employee capabilities and career development interests. Perhaps the most provocative aspect of the new compact, is that employees are encouraged to build outside networks and expertise, be part of post-employment alumni networks and maintain career-long relationships, which may include multiple tours of duty over time with the different employers, subject to mutual interests and needs. The authors further develop this concept in their book entitled The Alliance, Managing Talent In The Networked Age (Harvard Business Review Press, 2014). The Alliance presents a framework that provides for an employer and employee to establish a mutually beneficial partnership intended to build company success in exchange for an employee’s opportunity to enhance his/ her experience and market value. With the exception of longer Foundational tours of duty structured for an organisation’s senior leadership, more typical Rotational or Transformational tours of duty would be structured to last for a period of up to five years.

The alliance model has emerged from workforce management requirements facing information technology firms, which are perhaps also shared by companies in industry sectors that rely on highly specialised talent to drive innovation, capture their share of the market and maintain a competitive advantage, while managing sharp fluctuations in staffing needs. But this reflects only one side of the coin. The individuals who possess skills and experience that are in such high demand are enjoying a bit of an employees’ market. As such, people in this category have become much more astute at managing their careers and leveraging the luxury of choice. The

one-time acceptance of an employment opportunity based an ambiguous promise of future rewards is being replaced by a more strategic analysis focusing on the prospect of a specific, more direct return based on personal career interests and objectives. In an environment characterised by talent scarcity, there are many factors at play for candidates whose skills are in demand. Bringing employer and employee expectations in sync can be quite challenging, a circumstance that increases in complexity within the context of international assignments and talent mobility. In addition to identifying candidates with appropriate skills and experience, for a company the competition for talent involves getting the right people to the locations where they are needed most. For a candidate, location considerations become part of the assessment of individual and family requirements, career interests and personal goals.

For hiring managers, considerations beyond a person’s experience and professional capabilities is an important part of making an informed decision regarding candidate selection. There are ancillary factors relevant to determining a person’s potential for success, based on specified circumstances. This may especially be the case if an assignment is part of a shorterterm employer/employee engagement.

With the premise of an alliance between employer and employee in mind, to what extent do the assignment locations being discussed address the professional and personal needs of the candidate and his/her family? Are there locations that influence an increase in candidate expectations regarding compensation and accommodations? What is the candidate’s exposure to the host location relative to cultural nuances that impact the way business is conducted? Beyond the expertise required to address the business challenge, does he/she possess the selfawareness required to engage effectively with colleagues and others in the remote location?

Winter International HR Adviser

43

44

talent management It is important for an organisation to be able to articulate its priorities relative to international assignments, and to evaluate the global fluency of candidates relative to those priorities. A person’s ability to operate effectively in the global community can be as important as the technical skills and experience he/she brings to the table.

Consider, for example, an experienced, highly qualified person who is unaware of the cultural and professional norms that influence business transactions in the country where he/she is assigned. The investment of resources supporting the assignment could be placed at risk due to a lack of understanding regarding protocol.

Resistance to, or lack of awareness in this area can have a profound and sometimes irreparable impact on the success of the assignment, its timeline and outcome.

Evaluating a person’s opportunity for success when navigating an international assignment can be described in part as an assessment of his/her Global Mindset.

Based on extensive research conducted by the Thunderbird Najafi Global Mindset Institute, Global Mindset refers to a person’s ability to interact with, influence and relate to, individuals unlike themselves. (2014, Thunderbird Najafi Global Mindset Institute). It is a measure of Intellectual, Psychological and Social Capital relative to the ability to conduct business and communicate effectively in a global business environment.

Understanding a person’s capacity in each of these areas helps determine whether his/ her capabilities are aligned with those that may be required for a specific assignment, or to conduct business successfully outside of their home environment. While this may appear to be subordinate to professional skills and experience, a lack of interest in how to engage effectively with people from different parts of the world has been shown to create obstacles that interfere with the achievement of strategic objectives.

Setting an evaluation of Global Mindset as a priority when identifying potential candidates for critical international assignments will help identify opportunities to increase the potential for a successful international assignment, both for the organisation and the individual.

For the organisation, it can mitigate the potential for indirect interference that may impact achievement of the assignment objective. For the individual, it can contribute to faster assimilation in the new environment, which influences a more favourable professional and personal International HR Adviser Winter

experience. Reflecting for a moment on the alliance framework, it is possible that discussions involving global fluency may not be viewed as a priority by an individual being considered for a specific role. This may create another point of alignment, and perhaps negotiation when comparing organisational requirements with candidate objectives and interests.

But it is a point worth addressing, especially if the candidate is facing his/her first exposure to a new environment.

In their book entitled Managing Expatriates: A Return On Investment Approach (2013, New York, NY, Business Expert Press, LLC), Yvonne McNulty and Kerr Inkston introduce the concept of individual return on investment, or iROI, as “The perceived benefits that accrue to expatriates arising from international assignment experience in relation to professional and personal gains.” They later conduct an extensive discussion about the psychological contract between employer and employee, referring to it as being subjective, idiosyncratic and defined by the individual. The evaluation of a person’s commitment to global fluency is an important component of the professional qualifications that should be considered as criteria for an international assignment. It is important for organisational leaders to have confidence that the people who represent the company as its agents in the larger business community do so in a manner that is reflective of the company’s values regarding global citizenship.

An organisation’s ability to structure international assignments effectively represents a large component of its capacity to achieve strategic business objectives. It means not only considering the needs of the business and aligning the interests and expectations of the individuals engaged to do the work. In the global economy it also means knowing that the people who represent the company accept and embrace the importance of global literacy and view developing appropriate and relevant etiquette as a component of developing leadership and professional presence. Although the advantages of paying attention to this detail may be obscured in the implied expectations of an engagement, increased awareness of its relevance to building professional capital is what may differentiate like candidates with similar professional skills and experience. The individual interpretation of the psychological contract and quest

for personal gain is then focused more on assignments of higher value, with higher stakes, which stands to support a stronger alliance between employer and employee.

While international assignments have been a critical business component, and a mechanism for development for some time, assignment objectives have primarily been focused on organisational needs. The ability to establish and maintain alignment between organisational requirements, and the professional interests of key talent, is what will be required to effectively establish lasting professional relationships.

Whether long-term employees or alliance partners considered for periodic tours of duty, conversations about professional goals and interests should take place early and often, viewed through both a strategic and a professional development lens.

Elements of the emerging psychological contract are about a value proposition that reflects a shared purpose supporting the objectives of both the organisation and employee.

Brenda Harrington, ACC, CRP, is President of Adaptive Leadership Strategies, LLC. She is certified as an Executive Coach by the International Coach Federation and received coaches training at Georgetown University. Brenda is also certified by the Thunderbird Najafi Global Mindset Institute to facilitate the Global Mindset Inventory (GMI) self-assessment and GMI 360. She is a Moderator for the Corporate Learning division of Harvard Business School Publishing, and is affiliated with the Global Good Fund as a Leadership Development Consultant.

Brenda can be reached at +1-703-7236509, or via email at bharrington@ adaptiveleadershipstrategies.com.

FREE

SUBSCRIPTION TO

ISSUE 60

WINTER 2014-15

FREE SUBSCRIPTION

OFFER INSIDE

International HR Adviser The Leading Magazine

ionals Worldwide

For International HR Profess

Features Include: Assignees On Email For Engaging Home HR Rely Too Heavily ional Assignees Development From Internat Maximising Learning And IBU *T 5BY &RVBMJTBUJPO F ONFOU 5IF /FYU 'SPOUJFS t 8 (MPCBM 5BYBUJPO 6QEBU 5BMFOU "OE .PCJMJUZ "MJH SBUFHZ t BM )3 4U FSOBUJPO PCJMJUZ 1BSUOFSTIJQ t *OU Hardship Countries 5IF 5BMFOU "OE (MPCBM .

Going On Assignments To Be The Answer For Families -Past, Present And Future Online IB Education May ives On Ebola Outbreaks Businesses In Crisis: Perspect Advisory Panel for this issue:

The Leading Magazine for International HR Professionals Worldwide

Internatio nal HR Advise r AUTUMN

The Leadin

g Magazine

For Interna

tional HR

Profession

2014

ISSUE 59

PRICE ÂŁ10

.00

als Worldw

ide

courtesy of $IJOB 5IF Features Incl 5FO 4UFQT 5 3JTF PG $I ude: P 4FUUJOH 6 JOFTF .VMUJ Q "O *OUFSO OBUJPOBMT t 8PSLJOH 5J BUJPOBM 3FU (MPCBM 5B JSFNFOU "OE NF *O &VSP YBUJPO 6QEB QF )PX *T 4BWJOHT 1MB UF *U %FGJOFE " O t 1PMJDZ 5PQ OE *T 5IFSF 1SPWJTJPO ' 5JQT 'PS 8 $SPTT #PSE " (SPXJOH PS 1BOEFNJ SJUJOH (SFBU FS 3FTUSJDUJW 5SFOE 5P 3FE DT (MP F $PWFOBOUT CBM .PCJMJ &NQMPZFF 5 VDF *U UZ 1PMJDJFT o "SF 5IFZ SBOTGFST *O 8P SUI 5IF 1BQ "DRVJTJUJPO FS 5IFZ "SF T "OE 0VUTP 8S VSDJOH *T *U "MM "CPVU 5I JUUFO 0O Advisory Pan F "3% el for this issu e:

To apply for your free subscription please either complete the enclosed subscription card or visit our website www.internationalhradviser.com and complete the online registration International HR Adviser is the leading, quarterly magazine for International HR professionals globally. It has been publishing for 13 years and covers topics such as International HR Strategy, Benefits, Tax, Global Tax, Technology, Compensation, Trends in International Assignments, Healthcare, Insurance, Surveys, Country Profiles, Immigration, Moving & Relocation, Spousal Support, Education, Property, Cross-Cultural Issues, Case Studies, and more.

For further information please call Helen Elliott on +44 (0) 208 661 0186 Email: helen@internationalhradviser.com Website: www.internationalhradviser.com

46

DIARY DATES JANUARY 2015 Relocation & HR Professionals Networking Event: ISL London and ISL Surrey Tuesday 13 January, 9.30am-3.30pm International School of London, Surrey, 182 Old Woking Road, Woking GU22 8HY Join the International School of London for a networking event and lunch, showcasing the new IB Diploma College in London, plus tours of the expanded facilities on both ISL London and ISL Surrey campuses.

The International Schools of London are a group of award-winning, coeducational day schools for students aged 2 to 18. They are amongst the few schools in the world to offer an extensive, integrated languages programme, with over 20 languages currently taught from age 3.

RSVP and book by 5 January - Call +44 (0) 1483 750 409 or email kphipps@islsurrey.org

FEBRUARY The Corporate Relocation Conference & Exhibition 2rd February 2015 Hotel Russell, Russell Square, London www.internationalhradviser.com There are seminars dedicated to educating and up-dating International HR professionals on key developments and current leanings relevant to the industry, running throughout the day.

The 2014 Conference & Exhibition saw over 700 visitors attend this not-to-be-missed event.

Seminar Programme is as follows: 10.30am - Raising Internationally Mobile Children: Understanding and Nurturing the Third Culture Kid Experience.

Presented by Mary Langford, Independent Education Consultant 11.30am - Did My Identity Get Lost In The Move?

Presented by FOCUS 12.30pm - US Tax Updates & Overview Of The US/UK Tax Treaty For US Persons Residing In The UK. Presented by BDO LLP. 1.30pm - Immigration Update.

Presented by Ferguson Snell & Associates.

2.15pm - Short Term Business Visitors: Staying Ahead Of The Game.

Presented by Scott McCormick, Partner & Robin Brown, Senior Manager, Deloitte Global Employer Services.

3.30pm - Employment Disputes And How To Avoid Them.

Presented by Juliet Carp, Speechly Bircham LLP. 4.15pm - Expatriate Costs Simplified. Presented by Total Rewards Group.

These seminars are FREE to attend. To reserve your place in any or all of these seminars or for further information on attending or exhibiting please call Helen Elliott on +44 (0) 208 661 0186 or email helen@internationalhradviser.com

Worldwide ERC® Global Workforce Summit: Talent Mobility in EMEA 11 – 12 February 2015 Lancaster London Hotel, London, UK Explore essential benchmarking and educational opportunities and hear from industry leaders about how they are transforming their companies’ mobility programmes. Discover ideas for scalability and efficiency within the mobility corporate function. Gain from cost-effective policy improvements and collect a wealth of initiatives you can implement immediately within your own or your clients’ programmes. Corporate HR mobility practitioners are invited to take part in a complimentary registration offer, and the option to enrol in Worldwide ERC®’s Global Mobility Specialist (GMS)® certification training is also available.

Find full details and register at www.worldwideerc.org/emea15

The Houston Totally Expat Show 12 February 2015 Hyatt Regency, Houston, United States of America The Houston Totally Expat Show brings together dedicated global International HR Adviser Winter

mobility professionals, providers, consultants and industry professionals from across America. The show is a great opportunity for industry professionals to learn from experts, meet with key suppliers and share best practice with peers. The Totally Expat Show Series is a dedicated forum to unite global mobility professionals in their overall best practice in managing expatriates.

For more information, please contact Iyla MacIntyre on +44(0) 20 7943 8027 or email iyla.macintyre@centaur.co.uk. In-House Corporate HR Professionals attend free – book your place at: www.totallyexpat.com

MARCH Worldwide ERC® Global Workforce Summit: Talent Mobility in APAC 26 – 27 March 2015 Pudong Shangri-La Hotel, Shanghai, China Find the best and next practices at the 2015 Global Workforce Summit: Talent Mobility in APAC, where you will join a dynamic community of fellow professionals who are also building their knowledge and skills. If you are looking for ways to show and add value to your current company, build global leaders and a solid worldwide workforce, define your HR/ mobility strategy and develop relationships with thought leaders, experts and peers, you will want to attend the Summit! Corporate HR mobility practitioners are invited to take part in a complimentary registration offer, and the option to enrol in Worldwide ERC®’s Global Mobility Specialist (GMS)® certification training will also be available.

Learn more and register at www.worldwideerc.org/events

MAY European HR Inspired Conference 20 May 2015 Central London, UK The 3rd European HR Inspired Conference will take place on 20th May 2015 in Central London for a senior gathering of HR executives looking to engage with other director level professionals who want to discuss Employee Engagement, Talent Management and HR Data & Metrics.

Thought leadership is being delivered by Siemens, Deutsche Post DHL, Ebay, Belkin International, Mattel, Intercontinental Hotels, Diageo and Cafcass in a series of master classes, roundtables and panel discussions.

This complimentary format for senior HR practitioners working at medium to large organisations will allow executives the chance to gain insights into similar businesses who are solving key challenges within their HR departments.

For more information you can contact Chris Mills at c.mills@cibexmedia.com or call +44 7583 934217 or visit www.hrinspired.co.uk

September Worldwide ERC® Global Workforce Summit: Talent Mobility in LATAM 9-10 September 2015 Sheraton São Paulo WTC Hotel, São Paulo, Brazil Following the resounding success of its first Latin American programme last year, Worldwide ERC® will be returning to Brazil in September 2015 for another talent mobility Summit. Gain the calibre of trustworthy, reliable and current information on talent mobility that will empower you to work smarter, faster and more confidently. Join us as we explore region-specific challenges and opportunities, as well as global talent mobility solutions and trends.

Learn more and register at www.worldwideerc.org/events

If you would like to advertise a conference or exhibition on our Diary Dates and on www.internationalhradviser.com please email damian@internationalhradviser.com

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 programme 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 programme with our J-1 Visa Programme Administrator.

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 EMPLOYEE BENEFITS Willis Employee Benefits Limited 51 Lime Street, London EC3M 7DQ Contact: Chris Metz Telephone: +44 (0)203 124 8897 Email: webl@willis.com Website: www.willisemployeebenefits.co.uk Twitter: @WillisGroup LinkedIn: www.linkedin.com/company/willis Our global footprint and local presence in over 120 countries means you can depend on us to provide high quality compliant responses to the complicated issues of having a population dispersed throughout a number of countries – whether it’s your business travellers, global hires, short term or long term assignees. Willis can advise on and place a range of healthcare, disability, life and retirement solutions that fit the needs of your highly valued and demanding workforce.

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.

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, we serve corporate customers all over the globe with an award-winning* move management and destination service programme. Through our London and Paris headquarters and worldwide network of global partners, we help clients achieve their workforce mobility goals.

Every employee we relocate receives a dedicated DT Moving team member as a central point of coordination, support and advice to ensure every part of their relocation runs smoothly.

Our goal is your complete satisfaction, and with a 96% customer rating for 2013, we offer unrivalled quality at competitive rates. *Awarded six global relocation awards since 2010.

RELOCATION INTERDEAN RELOCATION SERVICES Central Way, Park Royal, London, NW10 7XW Contact: Mark Rising Telephone: +44 (0) 208 963 2520 Fax: +44 (0)208 965 4484 Email: Mark.Rising@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. We make it easy. Our Services: Relocation Management, Visa & Immigration, Area Orientation, Temporary Housing, Home Finding, School Search, Settlingin Assistance, Tenancy Management, Household Goods Moving, Intercultural & Language Training, Relocation Expense Management, Moving & Relocation Insurance and other services available – please ask.

UniGroup Relocation One Worldwide Drive St. Louis, MO 63026, USA Contact: Mario M. Amato Tel: + 1 636 349 2718 Fax: + 44 (0) 208 181 4945 Mobile: + 44 (0) 7513 061 536 mario_amato@unigroup.com www.UniGroupRelocation.com/hradvisor UniGroup Relocation is a global mobility network serving nearly 1,200 locations in more than 180 countries across six continents, making it one of the largest owner managed relocation networks in the world. Our broad range of pre-assignment, transportation and destination services will guide transferees along every step of the journey, from beginning to end. A common voice, a consistent standard of quality and unsurpassed local knowledge set UniGroup apart, giving our customers support and peace of mind as they settle in to their new international locations.

Winter International HR Adviser

47

48

DIRECTORY RELOCATION ASSOCIATIONS

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 EUROPEA N RELO CATION 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.

SCHOOLS International Community School 21 Star Street, London, W2 1QB Contact: Laura Thompson, Director of Marketing and Secondary Admissions Tel: +44 (0) 20 7402 0416 Web: www.icschool.co.uk Email: admissions@ics.uk.net An international day school located in 3 sites in the centre of London. We offer all three International Baccalaurate Programmes (PYP, MYP, and Diploma) to children aged 3-18yrs. ICS has a diverse community with 45 different nationalities, and boasts a strong tradition of working with students in a highly personalised tuition framework thus enabling every student to reach their maximum potential in a rigorous but supportive environment. For students needing English Language Support we offer our unique Preparation Programme that allows students to study mainstream academic subjects alongside the language tuition. We also welcome & provide outstanding support to children with Special Educational Needs.

Students at ICS benefit from a wide ranging sports & activity programme during term time and also during school holidays.

We have outdoor education centres at Chorleywood and Bawdsey, Suffolk and offer educational trips abroad as part of our Travel & Learn Programme. This year ICS is proud to be celebrating 35 years of offering international education.

International HR Adviser Winter

ISL Group of Schools ISL Surrey Old Woking Road, Woking, Surrey GU22 8HY Contact: Claudine Hakim Telephone: +44 (0)1483 750 409 ISL London 139 Gunnersbury Avenue, London W3 8LG Contact: Yoel Gordon Telephone: +44 (0)20 8992 5823 ISL Qatar PO Box 18511, North Duhail, Qatar Contact: Nivin El Aawar Telephone: +974 4433 8600 Website: www.islschools.org Email: hmulkey@islschools.org The International School of London (ISL) Group has schools in London, Surrey, and Qatar. The internationally recognised primary and secondary curricula have embedded language programmes (mother tongue, English as an Additional Language, and second language) which continue throughout the student’s stay in the school.

A team of experienced and qualified teachers and administrators provides every student with the opportunity to grow and learn in an environment that respects diversity and promotes identity, understanding, and a passion for learning.

MARYMOUNT INTERNATIONAL SCHOOL LONDON Address: George Road, Kingston upon Thames, KT2 7PE Contact: Mrs Cheryl Eysele Telephone: +44 (0)20 8949 0571 Email: admissions@marymountlondon.com Website: www.marymountlondon.com With an outstanding record teaching the respected International Baccalaureate for over 30 years, Marymount offers day and boarding to girls aged 11-18 who gain places at the world’s best universities.

Consistently ranked within the top 5% globally, Marymount also offers the pre-IB Middle Years Programme; this stretches students without the need for incessant testing. The nurturing, supportive Catholic Community welcomes all faiths and achieves a shared purpose for girls of more than 40 nationalities.

NEWLAND COLLEGE Newland Park, Chalfont St Giles Buckinghamshire HP8 4AD Registrar: Sophia Haig Website: www.newlandcollege.co.uk Email: info@newlandcollege.co.uk Newland College is set in 100 acres of parkland in the heart of the Chilterns, 45 mins from central London.

We are co-ed, with entry points at 11 and 13 years of age. We provide the International Baccalaureate curriculum. Boarding and day options are available. Email info@newlandcollege.co.uk to arrange a visit.

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.

If you would like to advertise in this Directory, the cost is £175 per issue or £700 for the year (4 issues). Please email damian@internationalhradviser.com

Helen Elliott & Damian Porter would like to wish all our readers & clients a very Happy and Prosperous 2015