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MOBILITY • Vol. 31 No. 8 • August 2010
AUGUST 2010 Worldwide ERC® Learning Zone Webinar Casting Light on Shadow Inventory: How It Will Affect the Economy—and You! August 3 2 p.m. to 3 p.m. EST Sponsored by Cartus and Primacy Cost: Free
OCTOBER 2010 GMS™ Training and Certification October 26-27 Seattle, WA Global Workforce Symposium October 27-29 Seattle, WA
EXECUTIVE COMMITTEE President MICHAEL (MIKE) C. WASHBOURN, SCRP, GMS, Pfizer I nc., Peapack, NJ Vice President SUSAN SCHNEIDER, SCRP, GMS, Plus Relocation Services, I nc., Minneapolis, MN Secretary/Treasurer PAMELA (PAM) J. O’CONNOR, SCRP, Leading Real Estate Companies of the World®, Chicago, I L Chairman, Board of Directors AL BLUMENBERG, SCRP, NEI Global Relocation, Omaha, NE
BOARD OF DIRECTORS CORI L. BEAUDET, SCRP, SGMS, SC Johnson—A Family Company, Racine, WI LISA CARAVELLA, CRP, Bank of America, Plano, TX JAY K. DELICH, SCRP, SRA, IFA, Arizona Appraisal Team, LLC, Scottsdale, AZ MARIO FERRARO, I nternational SOS Pte Ltd., SI NGAPORE MARK GIORGINI, GMS, China Vanke Co. Ltd., Shenzhen, CHI NA WILLIAM (BILL) GRAEBEL, SGMS, Graebel Relocation Services Worldwide, Aurora, CO JOHNNY H. HAINES, SCRP, SGMS, Deloitte, Hermitage, TN LARS LYKKE IVERSEN, Santa Fe Relocation Services, Hong Kong, CHI NA CHRISTOPHER (CHRIS) JAMES, Bechtel Corporation, Phoenix, AZ
JO LAY, SCRP, SGMS, Coldwell Banker Central Region Relocation, Chicago, I L
National Relocation Conference May 18-20 Las Vegas, NV
EARL LEE, Prudential Real Estate and Relocation Services, Scottsdale, AZ STEPHEN C. MCGARRY, SCRP, WPP, New York, NY SANTRUPT MISRA, PH.D., Aditya Birla Management Corporation Ltd., Mumbai, I NDI A JOY MORRISON, SCRP, SGMS, PepsiCo, I nc., Purchase, NY
OCTOBER 2011 Global Workforce Symposium October 12-14 Denver, CO
STEVEN A. NORD, Alpharetta, GA JOHN PFEIFFER, GMS, Mustang Engineering, L.P., Houston, TX PANDRA RICHIE, SCRP, GMS, Long & Foster Corporate Real Estate Services Division, Chantilly, VA C. MATTHEW (MATT) SPINOLO, SCRP, SGMS, CARTUS, Memphis, TN
EX-OFFICIO Chairman, U.S. Advisory Council
In Memoriam Paul G. Arpin, Sr., chairman of Arpin Group, Inc., Warwick, RI, passed away on June 12. He was 85. Arpin is survived by his beloved wife of 62 years, Margaret M. “Peggy” (Fay) Arpin; sons David, Peter, and Stephen; and four grandchildren Abby, Devin, Meredith and Taylor. He was also the father of the late Paul Arpin, Jr.
AL BLUMENBERG, SCRP, NEI Global Relocation, Omaha, NE Chairman, Foundation for Workforce Mobility KEVIN E. RUSSELL, SCRP, PHH Mortgage, Mt. Laurel, NJ Chairman, Global Advisory Council SANTRUPT MISRA, PH.D., Aditya Birla Management Corporation Ltd., Mumbai, I NDI A Chairman, Government Relations Council C. MATTHEW (MATT) SPINOLO, SCRP, SGMS, CARTUS, Memphis, TN
CHIEF EXECUTIVE OFFICER PEGGY SMITH, SCRP, SGMS, Worldwide ERC®, Arlington, VA
In Memoriam Colin Parker, founder of Move Management Australia, passed away on April 28, 2010, after an 18-month battle with cancer. He is survived by his four children.
MOBILITY (ISSN 0195-8194) is published monthly by Worldwide ERC®, 4401 Wilson Boulevard, Suite 510, Arlington, VA 22203, +1 703 842 3400. MOBILITY examines key issues affecting the global mobility workforce for the benefit of employers and firms or individuals providing specific services to relocated employees and their families. The opinions expressed in MOBILITY are those of the authors and do not necessarily reflect the opinions of Worldwide ERC®. MOBILITY is printed in the United States of America. Periodical postage paid at Arlington, VA, and additional mailing offices. Worldwide ERC® members receive one annual subscription with their membership dues. Subscriptions are available to both members and non-members at $48 each per year. Copyright © by Worldwide ERC®. All rights reserved. Neither all nor part of the contents published herein may be reproduced in any form without written permission of Worldwide ERC®. POSTMASTER: send address changes to M OBILITY , Worldwide ERC ®, 4401 Wilson Boulevard, Suite 510, Arlington, VA 22203
2 MOBILITY/AUGUST 2010
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Learning the Rules of the Game hysicist, philosopher, and author Albert Einstein once said, “you have to learn the rules of the game. And then
you have to play better than anyone else.” Einstein wasn’t even in the workforce mobility industry, but he has some great advice!
Playing the game better than anyone else is critical these days. And as we prepare for our 46th annual Global Workforce Symposium— “Workforce Mobility: The Game is Changing... Are You?”—we’ve considered some of these elements that are changing the game for the workforce mobility industry: We’re relying on community more than ever. An old proverb tells us that “politics makes strange bedfellows.” I’ll take that a step further: recessions make for some nontraditional partnerships! All around us, some creative and unfamiliar—but unparalleled— partnerships have sprung up to meet the needs of a new economy. And those new partnerships also are teaching us some lessons about the value of an educated, trusted, connected, and experienced community. We’re aware that talent and workforce management will change. Again. We all know about the war for talent—we recognize that competition will continue to heighten, and that geographic hiring hot spots keep surfacing in emerging markets. But after the recession, though some companies may be hungry for talent, they may rebuild their workforce just a bite or two at a time. Similar to the fully loaded expat package giving way to localization, where an assignee’s terms and conditions have been converted to those of local employees, some companies are eschewing the “fully loaded, full-time employee” in favor of alternatives like consultants and project workers, rather than committing right now to a full-time, long-term hire. We’re still frugal, and we’re still cautious.
4 MOBILITY/AUGUST 2010
“Cautious optimism” is still in vogue, though the financial picture is a little brighter. Companies have stopped watching their pennies, but they’re still watching their nickels, and some are still waiting for the other economic shoe to drop. Many of us are still on “resource lockdown,” only tentatively endeavoring to reinstate benefits or projects, or increase our workforce. Purchasing power has shifted: the United States is no longer “king;” and recession experts note that spending in emerging markets (like China and India) surpassed U.S. consumption for the first time. Post-recession pessimism is common among young adults, who are beginning to demonstrate a marked change in attitudes, behavior, and financial habits, and are likely to adopt a more conservative approach to credit and spending than their parents and grandparents. We’re adopting technology more quickly. In a recent entry to her wordsmithing blog, CEO Peggy Smith, SCRP, SGMS, noted that, “it is astounding to remember that Facebook was launched from a Harvard University dorm room only six years ago, and that Twitter was introduced even more recently, in 2006. Both experienced triple-digit growth in 2009, underscoring the fact that these most popular social media platforms are two of the pillars of the new era in business transparency and engagement.” We’re a world of both digital natives (those of us who grew up with digital technology and are younger than 30) and digital immigrants, who readily adopted technology for our work and personal lives. Either way, our workplace is increasingly and much more
rapidly being affected by technology that sometimes makes our work easier, and sometimes adds more layers of communication, but there’s one thing we can count on—it’s always changing, and much more quickly than ever before. And we have an imperative to learn how to integrate and use all of the technology we have in the most effective manner. We know that the housing market is strikingly different. Slightly encouraging but tempered predictions have been extended for the U.S. housing market’s short-term future. Job creation is key to a sustained economic and housing recovery, mortgage interest rates are likely to remain historically low, and though a slightly stronger demand for housing may be evident during coming months, the workforce mobility industry is primed to reengineer its work within and around the housing market for the most powerful outcome. We’ve moved from defense to offense. There is no doubt that we’ve navigated from survival to sustainability mode. Keith McFarland, author of the bestseller, “The Breakthrough Company,” conducted a five-year study of 7,000 growth companies during a 24-year period, and learned the top-performing companies all had one thing in common. “Great companies arise not from the absence of difficulty, but rather from its vortex,” says McFarland, adding, “it is during tough times that companies discover hidden strengths and latent capabilities which become crucial for future success.” –Karen Reid Worldwide ERC® Executive Vice President
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williams_MOBILITY 7/12/10 11:00 AM Page 6 2009 Fragomen ERC Mobility Art Full Page Ad - HR.pdf 4/9/2009 3:05:34 PM
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MOBILITY Magazine of Worldwide ERC®
Visas and Volcanoes: Crisis Planning for Immigration By Sophy King and Andrea Elliott
U.S. Immigration Issues for U.S. Employees Assigned Abroad By Matthew T. Phillips
Recruiting Foreign Workers in the United States—How to Remain Competitive and Ensure Compliance in a Climate of Increased Government Scrutiny By Sarah L. Tobocman, Esq., GMS,; Jay Carmichael, Esq.; Luciana C. Melo, Esq.; and Mariana R. Ribeiro, Esq.
Seven Essential Steps to Making the Right Relocation Pay Decisions
By Shari Dunn
50 56 62 66 74
The Promise of Personal Branding By Galen Tinder
10 Ways to Boost Your Relocation Brand Online By Andrea Martins
Personal Perspectives on Temporary Housing By Stefani R. Schreck, CRP, GMS
Making the Big Move: Relocating to Singapore By Siew Kiang Ng
Group Moves: an Analysis of Key Considerations By Allie Williamson, CRP
62 MOBILITY/AUGUST 2010 7
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MOBILITY Magazine of Worldwide ERC®
Vice President & Publisher jholloman@WorldwideERC.org
Learning the Rules of the Game By Karen Reid
Managing Editor Frank Mauck
10 AROUND THE WORLDWIDE ERC
EDITORIAL ADVISORY COMMITTEE
12 EXECUTIVE SPOTLIGHT
Jo Lay, SCRP, SGMS, Coldwell Banker Central Region Relocation, Northbrook, IL
15 INDUSTRY SPOTLIGHT
Tamara Bianchi, CRP, Capital Relocation Services, Denver, CO
15 WORLDWIDE ERC® TRENDSPOTTING
Christopher R. Chalk, CRP, GMS, Graebel Relocation Services Worldwide, Alpharetta, GA
18 QUICK TAKES
Brenda Darrow-Fuhs, Bank of America, Longmont, CO
79 SPECIAL ADVERTISING SECTION
Tim Denney, Stirling Henry Global Migration, Sydney, AUSTRALIA
98 ADVERTISERS’ RESOURCE 99 RAC REPORT 100 TAX AND LEGAL UPDATE 101 BEFORE YOU LEAP 102 MARKETPLACE 103 GLOBILITY® 104 LAST PAGE
Chairman Alex Alpert, Wheaton World Wide Moving, Tucson, AZ Robert F. Burch, SCRP, Alexander’s Mobility Services, Baltimore, MD Alex Chua, Newport Real Estate Limited, Shanghai, CHINA Terry Baxter Davis, SCRP, SGMS, Ernst & Young LLP, Cleveland, OH Marge A. Dillon, CRP, GMS, Nationstar Mortgage, Lewisville, TX Sean Dubberke, RW3 LLC, New York, NY Deborah A. Dull, CRP, GMS, Crown Relocations, Houston, TX Kari Hamilton, ABODA, Inc., Redmond, WA Nancy F. Harmann, CRP, GMS, Latter & Blum, Inc., Realtors, New Orleans, LA Gustavo Higuera, CRP, GMS, Prudential Real Estate and Relocation Services, Scottsdale, AZ Christine E. Holland, GMS, Massachusetts Institute of Technology, Cambridge, MA Ronald Huiskamp, GMS, Dwellworks, LLC, Kirkland, WA Rob Johnson, SCRP, SGMS, Altair Global Relocation, Plano, TX Tim McCarney, GMS, Weichert Relocation Resources Inc., Norwell, MA Elizabeth Perelstein, School Choice International, White Plains, NY Patricia Pollard, CRP, GMS, Coldwell Banker United Realtors, Houston, TX Michelle Sandlin, CRP, John Daugherty Realtors, Inc., Houston, TX Stefanie R. Schreck, CRP, GMS, American International Group, New York, NY Scott T. Sullivan, Brookfield Global Relocation Services, Woodridge, IL Mara Terrace, Siemens Corporation, Global Shared Services NA, Orlando, FL Sherrie Tessier, CVS, Woonsocket, RI Allie Williamson, CRP, OneWorld Relocation Services, Naples, FL GLOBAL EDITORIAL ADVISORY COMMITTEE
Chairman Joy Morrison, CRP, SGMS, PepsiCo, Inc., Purchase, NY Michele Bar-Pereg, Bar-Pereg Group, Amsterdam, THE NETHERLANDS Lorraine Bello, GMS, Ricklin-Echikson Associates, Inc. (REA), Millburn, NJ
Design/Production: Ideas, Communicated, LLC, Vienna, VA, www.ideascommunicated.com Printing: CADMUS Specialty Publications, Richmond, VA Reprints: Katina Moaney, CADMUS Reprint Services, email@example.com; +1 866 487 5625 ext. 3736 Advertising Sales: Glen Cox, National Sales Manager, The Townsend Group, +1 301 215 6710; ext. 109; firstname.lastname@example.org
Lorelei Carobolante, SCRP, SGMS, GPHR, G2nd Systems, LLC, San Ramon, CA Scott Craighead, SCRP, GMS, Blue Sky Executive Search, New York, NY Anne Dean, GMS, Living Abroad, LLC, Norwalk, CT Jeff Knapton, SIRVA Relocation, Westmont, IL Derrick Kon, Mercer (Singapore), Pte. Ltd, SINGAPORE Anne-Claude Lambelet, SGMS, ACL Consulting, Veyrier, SWITZERLAND Tacita Lewars, GMS, Globaforce Incorporated, Calgery, Alberta, CANADA Cindy Madden, CRP, Cartus, Danbury, CT Andrea Massoud, GMS, Living in Brazil, International Relocation Services, Barueri-Sao Paulo,BRAZIL Nino Nelissen, SGMS, Executive Mobility Group, Schlipol Airport, THE NETHERLANDS Constance Pegushin, Berry Appleman & Leiden LLP, San Francisco, CA Maureen Bridget Rabotin, GMS, Effective Global Leadership, Paris, FRANCE René Rosemary Stegmann, GMS, Relocation Africa, Cape Town, SOUTH AFRICA Rita Wagner, GMS, Interdean International Relocation, London, UNITED KINGDOM Nick Woodhams, SGMS, Woodhams Relocation Centre, Sydney, AUSTRALIA
8 MOBILITY/AUGUST 2010
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Around the Worldwide ERC®
Free for First-timers
f you are a corporate or government HR/relocation representative, and you are responsible for administering your own company’s workforce mobility program, and you have never been to one of our annual meetings, we have a special invitation for you: come to our Global Workforce Symposium in Seattle, WA, for your first time… for free! In case you’re wondering “why now?” and, “why free?”—here’s why… We think you’ll benefit from our meeting and we’d like to include you in our growing community of professionals who manage their company’s workforce mobility function. And to get you there for your first time, we want to make it more possible for you to come. If you manage global workforce mobility, you know
it is shifting dramatically and in unexpected ways. In fact, the theme of this year’s Global Workforce Symposium is “Workforce Mobility: the Game Is Changing… Are You?” and the focus will be on new rules, strategies, and tactics in global workforce mobility. And as our Symposium veterans who have benchmarked with corporate colleagues at this event in the past would attest, more HR professionals means better networking and deeper industry data for everyone attending. Peggy Smith, SCRP, SGMS, new CEO of Worldwide ERC®, is one such Symposium veteran. Prior to joining our staff, she directed Microsoft’s global mobility program, and, as a member, found that Worldwide ERC® was the professional association she needed to learn
A Little Birdie Told Me he Twitter birdie, that is! This little birdie is no longer going around telling our secrets—rather, it’s helping us spread news about Worldwide ERC® and the workforce mobility industry. Be sure to follow @WorldwideERC! And, get to know our new CEO Peggy Smith by following @PeggySmithWERC. It’s easy—if you don’t already have a Twitter account, visit http://twitter.com and set one up. Once you have done that, use the “people finder” to search for us. Oh, and there’s an app for that—and not just for the iPhone, either! Twitter is very mobile user friendly. If you need help—e-mail Webmaster@WorldwideERC.org. We’ll be happy to lend a hand!
10 MOBILITY/AUGUST 2010
more about her craft and stay close to industry trends. “I went to my first WERC conference in 2000,” she says. “And I never looked back—I loved the sense of community, the closeness, and the knowledge out there.” She’s looking forward to being back in her former hometown of Seattle, WA, and wants you to experience the same sense of community during this two-day event October 28 and 29.
To learn more—and to register for free if you’re a first-time corporate attendee!—visit: www.WorldwideERC.org/symposium
Questions? Please call our Meetings team at +1 703 842 3420 or e-mail Meetings@WorldwideERC.org.
Global Workforce Symposium Exhibit & Sponsorship Opportunities Now Available! et ready for one of the global workforce mobility industry’s largest annual events! Exhibit and sponsorship opportunities are now available for the 2010 Global Workforce Symposium at the Seattle Convention Center in Seattle, WA, on October 27 to 29, 2010. Now more than ever, it is critical to take advantage of this opportunity to boost your company’s visibility, showcase your services, and connect with your clients and partners. You will experience exceptional networking opportunities, insightful educational sessions, and a dynamic relocation services marketplace at the Symposium. If you provide workforce mobility and relocation services, exhibiting at this event is a MUST for your company! Exhibit space and sponsorship opportunities for the Global Workforce Symposium space is available on a first-come, first-serve basis, so sign up today! For more information and to sign up, visit the Global Workforce Symposium online at: www.WorldwideERC.org/Events/Pages/ gws10.aspx.
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quus Software, Denver, CO, has named Mark Rabe, CRP, GMS, vice president of business development.. Atlas Van Lines, Evansville, IN, has promoted Steve Hermann to vice president of agency services. NRT LLC, Parsippany, NJ, has named Kenneth Fries president of NRT Insurance Agency, Waltham, MA. NRT also has named Richard “Dick” Tucker, CRP, president of Jack Gaughen Realtor ERA. Fidelity Inspection & Consulting Services, Warminster, PA, has announced several promotions. Sue Duggan, Kathie Zerumski, and Carol Adams were named senior review specialists. Amanda Kouch and Erin Davis were named review specialists. Angelia Richardson, CRP, has joined the client services team of OneSource Relocation, Marietta, GA. Prudential Real Estate and Relocation Services, Inc., Scottsdale, AZ, has named Barbara Lewis senior vice president of global relocation sales. Weichert Relocation Resources Inc. (WRRI), Morris Plains, NJ, has named John Bartoloni, CRP, vice president of client services. Global Mobility Solutions, Scottsdale AZ., has named Lehman Vaughn, CRP, GMS, chief operating officer. Amanda Burris, CRP, GMS, was named vice president, business development. Samantha Hodges, GMS, was named vice president, global account management. NuCompass Mobility Services Inc., Pleasanton, CA, has named Mary Wasserman manager, immigration. Daniel Gale Sotheby’s International Realty, Huntington, NY, has named Nancy Carlin vice president and sales manager of the company’s Cold Spring Harbor office. TRC Global Solutions (TRC), Milwaukee, WI, has named Mario Verre, CRP, account manager. Leading Real Estate Companies of the World®, Chicago, IL, has named
12 MOBILITY/AUGUST 2010
Nationstar Mortgage, Lewisville, TX, has named Margie Dillon, CRP, GMS, PHR, national account manager, dedicated to relocation and corporate services. Dillon is a two-time member of the MOBILTY Editorial Advisory Committee and a speaker at the Worldwide ERC® National Relocation Conference. A licensed real estate agent in Texas, she also serves on the board of directors of the North Texas Relocation Professionals.
Pat Poole vice president of business solutions, and will be based in Coronado, CA. Chinowth & Cohen Realtors, Tulsa, OK, has named Cindy Manchester director of relocation and business development. Nelson Westerberg, Inc., Elk Grove Village, IL, has named Jill Knicely director, corporate business development for its U.S. southeast region. Susan Garganese has been promoted to general manager of Arpin of Rhode Island, an agent of Arpin Van Lines. West Warwick, RI. UniGroup, Inc., St. Louis, MO, has announced nine agent representatives have been elected to its board of directors. Daryl R. Flood, Daryl Flood Warehouse and Movers, Inc., Dallas, TX, and John F. Sabatalo, Planes Moving and Storage, Westchester, OH, were appointed to the board. Thomas E. Andresen, Jr., T.E. Andresen, Inc., Salem, MA; H. Daniel McCollister, McCollister’s Transportation, Burlington, NJ; Barry S. Vaughn, Suddath Relocation Systems, Jacksonville, FL; David S. Sabada, A-Mrazek Moving Systems, Kirkwood, MO; Richard K. Smith, Corporate Moving Systems, Inc., Kent, WA; J. Martin McLaughlin, McLaughlin Transportation Systems, Inc., Nashua, NH; and Steven E. Komorous, King Relocation Services, Santa Fe Springs, CA, were re-elected to two-year terms. Henkel, Rocky Hill, CT, has named Michael Biondolillo senior vice president of human resources.
International Professional Relations, Inc., The Woodlands, TX has announced the retirement of managing director Dottie Byers, CRP, GMS. Cynthia Sibold, GMS, has been named managing director of business development and client services. Jennipher Christensen, GMS, has been named managing director of operations and client services. Crown Relocations, Beijing, China, has named James E. Thompson, III deputy managing director, mainland China. Marriott ExecuStay, Bethesda, MD, has named Cherie Warfield director of sales for the Richmond, VA, market. Jeff Bourne was named account executive for the Richmond market. Warfield and Bourne are employed by Commonwealth Corporates, operator of ExecuStay in Richmond. The company also announced that vice president Adam Sherer has been elected president of the Corporate Housing Providers Association. Allen Tate Company, Charlotte, NC, has named Pam Davis, CRP, relocation director for Allen Tate Relocation.Terri Massengale has been named sales manager and business development manager of Allen Tate Company’s, Winston-Salem, NC, office. Arpin International Group has named Lisa McElligott domestic relocation coordinator in its service center in Boston, MA. Heidi Stewart has joined Arpin-Canada, Toronto, Ontario, as operations manager, and Jessica Welsh was named account coordinator.
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Report Identifies Companies’ Top Concerns for Transferees During the Next Decade A new report from Brookfield Global Relocation Services, Woodridge, IL, has discovered that the next 10 years will be critical for companies with international workforces as they focus on issues such as the changing nature of temporary assignments, cross-border commuters, and emerging markets. The research report, “Employee Mobility in the New Decade,” a supplement to the 2010 “Global Relocation Trends Survey” report, released at the annual conference of the Society for Human Resource Management (SHRM) in San Diego, CA, revealed the results of a survey conducted during the first quarter of 2010. Brookfield Global Relocation Services queried senior mobility managers from multinational firms to determine their top concerns for the next five to 10 years. “Our report is the first of its kind to take a detailed look at what challenges companies will be facing with their international mobility strategies during the next decade,” said Scott Sullivan, executive vice president of Brookfield Global Relocation Services. “This report validates research from our 2010 Global Relocation Trends Report [Editor’s note: please see Industry Spotlight in the May 2010 issue of MOBILITY for further analysis of the 2010 “Global Relocation Trends Report.”], which found that emerging markets such as China, India and Russia, pose huge challenges to both expatriates and human resource executives.” According to the report, mobility professionals identified several challenges, one of which is the linking of talent management and employee mobility. According to Brookfield Global Relocation Services, the nature of temporary assignments continues to evolve and is leading
both employers and employees to closely examine the perceived benefits of these type of assignments. Employers, faced with large investments of time and money, are questioning why they are sending employees on international assignment and increasingly are trying to measure the returns on investment. On the other hand, employees are evaluating the personal and professional value of overseas assignments after the fact, because it seems to have little or no bearing on their ability to advance within the organization, according to the release. The
survey found that 38 percent of employees leave their company within one year of repatriation, a figure that is within range of industry estimates between 25 and 45 percent. “This is a key issue for global organizations, since this is a population of employees that they have invested heavily in,” said Sullivan. “Losing these employees represents a significant loss of experience and talent. Many of the companies we surveyed are beginning to see the integration of talent management and international assignment mobility as
Stewart Relocation Services
Title and Closing Services for the Relocation Industry MOBILITY/AUGUST 2010 15
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a strategy to turn this loss into a competitive gain.” A second concern for employers identified by the report is that of cross-boder commuters. During the last 10 years, commuter assignments as an alternative to short- and longterm assignments have taken on a larger role, particularly in Europe, according to the release.
The report found that, during the next 10 years, an increasing number of companies will view cross-border commuter assignments as a viable component of their mobility programs. A third concern for organizations are emerging markets. Top destinations vary by industry, company business objectives, and global reach,
according to the release. The Brookfield Global Relocation Services “Global Relocation Trends” survey found that emerging locations represent a wide variety of countries, from long-term assignment destinations to those seen as new locations for expatriate assignments, such as Saudia Arabia, Qatar, Hungary, and Sweden.
FYI Oakwood Worldwide, Los Angeles, CA, has announced a five-year, global contract with Microsoft Corporation, Redmond, WA, to provide temporary housing services in North America outside of Puget Sound, South America, Europe, Middle East, Africa, and Asia Pacific. Graebel Companies, Inc., Aurora, CO, has announced the release of the Graebel Relocation APP, a mobile communication and reporting tool for transferees with iPhones® or iPads®. Move One, Dubai, United Arab Emirates, has announced the release of the video, “Living in Belgrade: Overview,” as part of the company’s City Guides™ series. Crown Relocations, Huntington Beach, CA, has announced the opening of Crown Copenhagen in Copenhagen, Denmark. Leading Real Estate Companies of the World®, Chicago, IL, has announced it has named Aumnia, Newport Beach, CA, a preferred provider under its Leading Real Estate Solutions® division. PODS Moving and Storage, Clearwater, FL, has announced its expansion into the United Kingdom with its first franchise in Leeds, England. Allied Van Lines, Chicago, IL, a subsidiary of SIRVA, Inc., Chicago, has announced it has reached an agreement with the Agent Association Board and Contract to offer a three-year contract extension to its member agents across the United States. Mercer, New York, NY, has announced it has signed an agreement to acquire ORC Worldwide, New York. Tri-State Relocation Services, New York, NY, has announced it has changed its name to NYC Organization of Relocation Professionals (NYCorp). Marriott ExecuStay, Bethesda, MD, has announced it has completed the final phase of renovation to all 126 furnished apartments at The Aurora Midtown East in New York, NY. Daniel Gail Sotheby’s International Realty, Huntington, NY, has been named a principal member of the Cartus Broker Network. Stirling Henry Global Migration, Sydney, Australia, has announced the opening of a new office in Perth. Steinborn Inc. REALTORS®, Las Cruces, NM, announced it has renamed its residential division to Steinborn & Associates Real Estate, which will join Leading Real Estate Companies of the World®, Chicago, IL.
16 MOBILITY/AUGUST 2010
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Bridging Continents & Cultures Chicago Calgary
Los Angeles Toronto
New York Vancouver
Philadelphia London, UK
San Francisco Hong Kong
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201 in Our 20th Year he Certified Relocation Professional (CRP ) designation Tand program turned 20 this year! One of many celebra™
tions of this event was the giveaway of a free CRP® test registration to one of the 243 people who took the CRP® examination on May 19, in Orlando, FL (site of the Worldwide ERC® National Relocation Conference); Chicago, IL; Cincinnati, OH; Dallas, TX; Denver, CO; Minneapolis, MN; Phoenix, AZ; or Stamford, CT. We are proud to announce that Pamela Metzger, CRP, of Colorado Landmark Realtors in Boulder, CO, is our winner! Pamela was one of 201 people to pass the CRP® examination by showing her knowledge of U.S. domestic corporate polices, procedures, and issues; relocation appraising issues; real estate relocation issues; tax and legal issues; family issues; and mobility strategies.
Job Market in Second Half of 2010 to Stay the Course ccording to a nationwide survey conducted by CareerBuilder and USA TODAY, 41 percent of hiring managers plan to hire in the months of July through December. Twenty percent plan to hire full-time, permanent employees in the third quarter, similar to the two previous quarters. The survey, conducted by Harris Interactive© from May 18 to June 3, 2010, queried more than 2,500 hiring managers and HR professionals and 4,400 workers across a variety of industries. “Employers began recruiting at a moderate, but consistent pace in the first half of 2010 as confidence levels inched upward amidst a better global financial picture,” said Matt Ferguson, CEO of CareerBuilder. “The economic recovery has broadened, but employers remain guarded. The survey indicates that we’ll see sustainable new job growth through the remainder of the year, but it will be absent of any dramatic shifts.”
orldwide ERC® members are exchanging questions, answers, and ideas in our online discussion Forums. Under discussion right now:
U.S. Domestic Relocation All Member Forum: “Wondering if anyone can provide trends showing the amount of homes that are taken into inventory by a corporation when using a BVO? Specifically looking for how many times a sale fell through during the time the employer took ownership from the EE and was preparing to sell to bona fide buyer.” Global Workforce Mobility All Member Forum: “I have encountered a situation in which the French entity of our company pays both the employer AND employee contributions to French social security while the employee is on assignment to another country. I have never heard of such a practice, and it is my experience that the assignee is always responsible for their home country hypo or actual taxes, including social contributions. Does anyone have any experience with such an arrangement? Is it somehow a French-centric approach? All comments will be appreciated!” The China Blog: This summer blog author Mark Giorgini, GMS, turned over the reins to some of his grad students who have been providing interesting thoughts and perspectives like the post on July 12, “Voices: War for Talent: Appealing to Chinese Graduates” by Yvonne TAO Yi, which begins, “If a Chinese graduate received offers both from multinational companies and government departments, guess which one would he/she would prefer?” Read the answers solicited by these questions and add your comments and questions today. To get there, visit www.WorldwideERC.org/pages/web2.0.aspx or click on the white “Communities” hyperlink at the top of every page of www.WorldwideERC.org. Note that access to the forums is an exclusive benefit of Worldwide ERC® membership.
18 MOBILITY/AUGUST 2010
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Volcanoes Crisis Planning for Immigration BY SOPHY KING AND ANDREA ELLIOTT
e all have heard quite enough about that unpronounceable volcano by now. The eruption in April 2010 of the Eyjafjallajokul volcano in Iceland and the resulting ash cloud pushed volcanoes into the spotlight; from the stuff of geography lessons and Sunday night nature programs, volcanoes have become another thorn in the side of travel companies and travelers alike. The Transport Commissioner of the European Union, Siim Kallas, estimated that European businesses lost up to 2.5 billion euros as a direct result of the volcanic ash cloud, with airlines bearing the brunt of the blow. Giovanni Bisignani, the director general and CEO of the International Air Travel Association (IATA), commented on April 22, â€œlost revenues now total
22 MOBILITY/AUGUST 2010
more than $1.7 billion for airlines alone. At the worst, the crisis impacted 29 percent of global aviation and affected 1.2 million passengers a day. The scale of the crisis eclipsed 9/11 when U.S. airspace was closed for three days.â€? On a personal level, holidays were cancelled, business trips postponed, and hundreds of thousands of individuals were stranded overseas: separated from their families, facing mounting hotel bills and painful struggles with their insurance companies, and all with no clean socks. So, tears all round, really. But at least it was a one off, right? Unfortunately, wrong. The last time this particular volcano erupted, it continued to do so for two years. It is possible that airspace over Europe will continue to face last minute closures for a good while yet. Summer holidays are under threat, and many families across Europe are opting to travel by car or train instead of by air.
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Last minute travel disruption is expensive, irritating, and upsettingâ€” but what happens if it also affects your immigration status? Can a volcano throw your company out of compliance? In this article, King and Elliott look at how volcanoes and other factors could affect your immigration program directlyâ€”and provide clear guidance on how to put together an immigration disaster plan.
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Mary Walsh, spokesperson for Eurostar, commented in an interview that the ash cloud has “caused people to look at high-speed rail differently,” with an independent online poll between April 21 and 23 suggesting 84 percent of travelers would “definitely” or “probably” choose trains over planes for travel from London to Paris and Brussels in the future. Looking at the bigger picture, this decision may make sense on several levels. As all readers of MOBILITY will know, there are plenty more reasons for cancelling a flight than a volcano in Iceland. Other “acts of God,” such as tsunamis and earthquakes, are unfortunately all too common in many parts of the world. At the extreme end of things, we also have seen terrorist attacks and terrorist threats close airspace. Several commentators, marveling at the clear skies above London in April, remarked on the similarity to the days after 9/11 when airspace over the United States was closed for three days. Even if we leave aside these natural and man-made disasters, it goes without saying that adverse weather conditions such as fog or ice can ground flights for days. Finally, even if the flight leaves on schedule, that does not mean all the travelers booked onto it will be there. We all have missed flights for various reasons, from being stuck in traffic on the way to the airport to oversleeping. So far, so irritating. But what about travelers who require immigration approval to enter or remain in a country? How do unexpected flight delays or cancellations affect these people? When does an annoying 24 MOBILITY/AUGUST 2010
delay become a major headache and a potential compliance risk for your company? Let us start by taking a look at the kinds of employees you might have who could be severely affected, from an immigration point of view, by travel disruption: Foreign national residents of a third country, whose visas or permits are close to expiration and who had booked exit travel for just before visa/permit expiration. For example, consider an expatriate who has been living in London with his family on a two-year assignment from Chicago, IL. Their leave to remain (residence permission) in the UK expires on April 10, and although the expatriate’s assignment finishes on March 31, he has promised his family a two-week holiday in the UK to say goodbye—they all are planning to fly back home on April 9. Then a volcano erupts… and the family is stuck in the UK until their airline can get them on a flight back home. People who have obtained new visas/permits to travel to a country and who are required to use these within a certain time frame to ensure validity. For example, consider the head of marketing for a small U.S. firm. She is going on an 18-month assignment to Barcelona, Spain, in September. Her work permit has been approved, and, being an organized person, she picked up her Type D visa from the Spanish Consulate General in New York a few weeks ago. Her bags are packed, her apartment sublet, and she is looking forward to Barcelona. She just has a few things to tie up in New York before she can go—she is planning to travel within 90 days of
collecting her visa, but only just. Then, on her way to the farewell party her colleagues are throwing for her, her heel snaps and she twists her ankle badly—she is laid up in the hospital with strict orders not to put weight on her leg for at least a week. Her visa only has three days of validity left on it. Does she have to start the whole application again? Business travelers who have obtained short-term visas with limited validity. For example, consider a Russian national living in London. She has an important meeting in Brussels on Monday, July 5, and already has obtained her Schengen Type C visa— it is valid from July 4 to July 6. She is the CFO of her company and is pretty busy, but she still had to find time to go to the Belgian Embassy in London, as a personal appearance is mandatory. She turns up at the airport on Monday afternoon, only to find that her flight has been cancelled because of “engine problems.” The next available flight is on Tuesday morning—and she cannot extend her stay in Belgium past Tuesday evening because her visa will no longer be valid. Is another trip to the Belgian Embassy in store for her? Business travelers on “visa waiver” programs who already have stayed in the third country for the maximum time allowed without a visa and were planning to leave at the last minute. For example, consider an expatriate who has been in Europe for an extended series of business meetings, finishing in Budapest on November 25. He is a U.S. national, so he did not need to get a visa before he trav-
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eled, but his stay in the Schengen area (which comprises much of the EU and EFTA, excluding the UK, Ireland, Romania, and Bulgaria) is limited to a maximum of 90 days out of 180. He has done a lot of traveling in the last few months and so his 90 days expire on November 26. At the last minute, there is heavy and unseasonable snowfall, and all flights from Budapest are grounded. Is he now an illegal immigrant? Essentially, whatever your nationality and whatever country you are in, last-minute travel disruption can bring up some tricky immigration questions. As always with immigration matters, different countries have different rules around this subject, of which the prepared HR manager should be aware. Let us take a look at some of these, region by region.
Europe UK. When the Icelandic volcano first started causing trouble in April,
the UK Border Agency (UKBA) was quick to react. Almost immediately, a notice appeared on the UKBA website reassuring passengers who found themselves unable to depart: “The UK Border Agency would like to reassure travelers who have been unable to leave the UK and whose visas have now expired. We appreciate that this is due to exceptional circumstances beyond your control. Please ensure that you retain proof of planned travel that would have enabled you to leave the UK before your visa expired.” So, the expatriate in our first example and his family should be okay. Sarah Buttler, director of Pro-Link GLOBAL’s (PLG) Keiretsu Global Network Member (KGNM) correspondent office in London, comments that the UKBA is generally reasonable, and that in the event that travel is disrupted beyond the passenger’s control—even for non-volcanic reasons—and provided the passenger can demonstrate his or her good
intentions to leave to the UK Border Agency, he or she should not be penalized. Buttler further comments, however, that the UKBA neglected to mention one important point: companies sponsoring employees to enter the UK under Tier 2 of the Points Based System (General or Intra Company Transfer) are obliged to specify the start date of the UK employment in their applications for Certificates of Sponsorship. If that date changes, for any reason, including a volcano erupting and postponing the employee’s arrival date, then the UK employer has a duty to notify the UK Border Agency. Failure to do this technically would put the employer out of compliance with UK immigration regulations. Ireland. Ireland took a similar line to the UK and published an announcement on the Irish Naturalization and Immigration Service (INIS) website, which stated that, “visa recognition would be extended up to 16 May 2010, for all
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visa holders who could produce evidence of a cancelled flight and whose visas were due to expire after 15 April 2010.” They also advised that travelers should carry evidence of travel cancellations with them to present to immigration officers at the airport in case of questions. Russia. Some newspapers carried reports of volcano-affected travelers being held under police guard in Moscow’s Sheremetyevo airport, but according to the PLG KGNM Moscow correspondent office, these reports were exaggerated. Kasia Pinska comments, “Sheremetyevo airport has a consular officer on duty who can issue transit visas that cover
24 hours in case of need. If a traveler is forced to stay in Russia for more than 24 hours, prolongation of the visa can be applied for either at the UFMS in Moscow or at the office of the Ministry of Foreign Affairs at the border. Reasons for the prolongation request plus supporting documentation will be requested. Reasons may include the death of close family members in Russia, severe disease or illness, as well as other unpredictable circumstances such as the volcano.” Hungary. If a foreigner attempts to exit Hungary with an expired visa, or having overstayed their “visa waiver” permission, the border police have the right to place the visa hold-
er on a blacklist and to refuse them entry to Hungary in the future. Because Hungary is a member of the Schengen area, this penalty could be very damaging for business travelers. The PLG KGNM correspondent office in Budapest says, “if a foreigner’s visa has expired and they did not extend in time, immigration officers will give an exit visa—but the applicant must come to the immigration office with proof of a purchased flight in order to obtain this.” Looks like our friend from the fourth example should not risk trying to exit Hungary after his 90 days have expired—better to go to the trouble of obtaining an exit permit than to put himself out of compliance.
Asia Pacific Australia. Foreign nationals in Australia with visas close to expiration who find themselves unable to travel at the last minute are required to extend their visas. Extension of visitor visas is possible in some circumstances. In other situations, such as a medical emergency, travelers may be able to obtain a “medical treatment visa,” which will prolong their permission to stay. However, as Robert Lu of the PLG KGNM correspondent office in Sydney points out,“it is important to note that some Australian visas have a ‘no further stay’ visa condition (8503) attached to their visa. The ‘no further stay’ visa is implemented to ensure visitors are prevented from applying for another visa while they are in Australia to remain in the country. The ‘no further stay’ condition can be waived if they are able to argue that there are “compelling and compassionate reasons.” 26 MOBILITY/AUGUST 2010
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The Australian immigration policy’s definition of “compelling and compassionate reasons” does include natural disasters that would make it unreasonable to expect the traveler to return home, as well as medical conditions of the visa holder, and death or serious illness of family members, and war or severe civil or political strife in the visa holder’s home country. Hong Kong. Visas for Hong Kong may be extended where the visa holders have been unable to depart through no fault of their own. The PLG KGNM correspondent office in Hong Kong points out that, “the Hong Kong Immigration Department is flexible in dealing with out of the ordinary situations like this. Subject to providing all necessary documents and a reasonable explanation to the Hong Kong Immigration Department, an extension can be granted.” India. When the Eyjafjallajokul volcano erupted, pictures of confused and exhausted travelers in Delhi air-
port were published in the media. Foreign nationals whose visas have expired and who wish to leave India should obtain exit permits from the Foreigners’ Regional Registration Office (FRRO) prior to departure. However, in some situations, such as natural disasters like the volcano, a grace period of around two weeks may be granted at the authorities’ discretion. During the grace period, travelers whose visas have expired should be allowed to depart without an exit permit. Sandeep Sharma of the PLG KGNM correspondent office in New Delhi, comments, “the grace period is granted on a case-bycase basis. For the volcano scenario, the grace period was 15 days and, after that, you needed an exit permit. In the case of the last terrorist attack in India, exit permits were still needed to leave the country.”
The Americas The United States. Nonimmigrants (i.e. H-1B, L-1, B-1, B-2,
or Visa Waiver Program tourist or business travelers) in the United States are required to depart the United States prior to the expiration of their immigration status or risk being deemed an “overstay.” The eruption of the volcano did not affect U.S. airspace, but it did mean that many travelers who had been planning to return to Europe were unable to depart. The U.S. Customs and Border Protection issued a travel advisory and United States Citizenship and Immigration Services (USCIS) provided additional guidance—all of which essentially said non-immigrants with expired visas should arrange extension of status, and travelers on the Visa Waiver Program should contact the immigration authorities directly for further advice.
Business Travelers It is worth looking at business travelers separately. Often, visas issued for specific business or tourist travel have a very specific validity, which only
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may be for the few days of the conference or holiday. If an unscheduled problem postpones the travel, any immigration waivers or exemptions granted to long-stay visa holders typically will not include business visitors coming into the country. For example, the UK Border Agency’s website announcement covered people in the UK on visas, but if a traveler had obtained a limited validity business visa for the UK and was unable to use it because of the volcano, they simply would have to go and get another one. Likewise, the business traveler in the third example would need to get a new visa for Belgium—with all the trouble and expense that this involves. Another important point to note about business travelers is that they generally are not benefiting from an expatriate or mobility program, which means that they do not have advisers on hand to help them out in an event like this. Lusiné Meeks, director of global rewards and mobility for Sabre Holdings, Dallas, TX, says, “the population mostly affected for us is business travelers. My heart goes out to them. Our in-scope employees know that if they have a visa problem or question they can contact me or Andrea [Elliott from Pro-Link GLOBAL]. There is so much support available to them. It’s the business travelers who are on their own—they have arranged their visas themselves and if they get stuck, they don’t always have a contact to help them.”
Summary In immigration, as in many areas of the law, intent is key. In most countries where a foreign national 28 MOBILITY/AUGUST 2010
can demonstrate his or her intent to leave the country prior to the expiration of a visa or permit, and can show that travel plans were disrupted through no fault of the individual— whether that disruption was caused by a volcano, a terrorist attack, or a tsunami, immigration authorities will show flexibility. However, business travelers requiring visas likely are to be affected adversely and in many instances will need to apply for a fresh visa. Smart companies will develop a travel disruption immigration policy. The following recommendations may help: Make sure HR and mobility managers remember immigration when something like the Eyjafjallajokul volcano happens. There is plenty to think about and to take action on, and visas can seem last on the list. Do not let this happen—make sure that your staff does not forget about expatriate worker immigration status, or that you are working with a service provider that will proactively warn you of any implications. Track employee immigration status. Make sure you know the visa and permit expiration dates and that you have access to this information at short notice. Either implement a tracking system yourself or make sure you are using a service provider who can offer this. Do not travel too late. You may wish to consider implementing a policy where employees on an expiring residence permit or visa do not travel within the last two or three days of expiration. Volcano eruptions might be rare, but missing a flight is not, and you do not want
to have the trouble and expense of obtaining re-entry permits or exit permits if you can avoid it. Use visas in good time. Similar to point 3, you may wish to introduce a rule that your employees must not leave it to the last minute to travel on a valid longstay visa. Clearly, this cannot apply to business visas, which often are valid only for a few days in the first place. We never got around to discussing the situation of the woman in the second example (the head of marketing who twisted her ankle and had to delay her trip to Barcelona)—the answer, unfortunately, is that yes, she will need to go and get her visa again, because regardless of the reasons for her inability to travel, the visa has expired and will not be converted to a residence permit once she gets to Spain. Make sure employees travel at least a week before the long stay visa expires. Give business travelers a contact name and number. Even if your business travelers do not receive mobility support, and arrange all their own visas, ensure that everyone in your company has access to the contact details of someone who could help in an emergency. The contact could be an HR manager who has access to immigration support or an external services provider.
Sophy King is director, knowledge management for Pro-Link GLOBAL, and currently is based in Madrid, Spain. She can be reached at + 44 (0) 203 004 9438.or e-mail firstname.lastname@example.org. Andrea Elliott is senior global counsel for Pro-Link GLOBAL, and is based in Bradenton, FL. She can be reached at +1 941 794 6461.or e-mail email@example.com.
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U.S. Immigration Issues
for U.S. Employees Assigned Abroad B Y M A T T H E W T. P H I L L I P S U.S.-based employees create a variety of mobility-related issues for their employers when traveling on an extended assignment abroad. Phillips writes that one important issue that requires careful attention—especially for non-U.S. citizens—is ensuring that an expatriate’s time abroad does not jeopardize his or her U.S. immigration status.
hen an employer sends a U.S.-based employee on an extended assignment abroad, there are a host of mobility-related issues which must be addressed. These issues include, but are not limited to, taxation, compensation, benefits, housing, totalization agreements, and importantly, arranging for any foreign entrance visas, work authorizations, residency permits, and reentry permits required for the employee and his or her family by the country in which the assignment is to take place. Another important issue, however, merits close consideration, namely, ensuring that, particularly for those employees who are not U.S. citizens, an extended assignment abroad does not place their U.S. immigration status in jeopardy, and further that the employee and family members are fully capable of returning to the United States as needed. For the purposes of this article, U.S.-based employees assigned abroad can be divided into three broad categories: U.S. citizens; U.S. permanent residents; and foreign nationals who are authorized for temporary employment in the United States, typically through what is called a “nonimmigrant visa.” Following are discussions of each of these categories.
30 MOBILITY/AUGUST 2010
U.S. Citizens Are Easy The easiest category of workers to deal with in this regard are U.S. citizens. Simply stated, a U.S. citizen has no U.S. immigration-related issues and is entitled to return to the United States at any time regardless of the amount of time spent abroad. However, a U.S. citizen should be mindful of the need to maintain a current U.S. passport as proof of citizenship for travel purposes, and U.S. consulates can assist U.S. citizens abroad with obtaining new passports if necessary.
U.S. Permanent Residents U.S. permanent residents, who hold what is still colloquially known as the “green card” (despite the fact that it had not been green for several decades, but soon will revert to green again), must consider two separate issues in light of an assignment abroad. First, a U.S. permanent resident must actively take steps to maintain his or her U.S. permanent resident status because, as we will see, permanent resident status can be lost. Second, a U.S. permanent resident should be mindful of maintaining his or her eligibility for U.S. citizenship if pursuing U.S. citizenship is of interest.
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The amount of time spent abroad is an important factor considered by the Department of Homeland Security (DHS) when making the determination as to whether a U.S. permanent resident has maintained the intent to retain permanent resident status. Simply stated, the more time a U.S. permanent resident spends abroad, the more likely DHS is to conclude that the foreign national does not intend to maintain his or her U.S. status. However, other factors also are relevant to the analysis by DHS. Specifically, the factors reviewed by DHS may include, but are not limited to: as noted, the amount of time spent abroad; importantly, the continued filing of U.S. tax returns as a permanent resident (as opposed to filing as a temporary resident/ nonimmigrant, or not filing at all, discussed more fully below); and the existence of other connections to the United States, such as, by way of example, U.S.-based or related employment, a U.S. residence, family connections in the United States, and/or other indication that the foreign national intends to reside permanently in the United States. The filing of U.S. tax returns as a permanent resident merits special attention. The United States is a party to many tax treaties with foreign countries that may allow a U.S. permanent resident to reduce their overall tax burden by filing as a temporary resident or nonimmigrant of the United States, as opposed to a permanent resident. While such a filing may be beneficial from a tax perspective, it can be highly detrimental from a U.S. immigration perspective, as DHS will consider strongly such a filing to be indicative of a lack of intent on the part of the foreign national to maintain their U.S. per32 MOBILITY/AUGUST 2010
manent resident status. It is important to note that, contrary to a popular misconception, simply returning to the United States for some period of time on an annual basis is not sufficient in and of itself to ensure the continuance and maintenance of permanent resident status. Time spent in the United States is but one factor in this consideration, and foreign nationals who have spent time in the United States once a year still may be deemed to have lost their U.S. permanent resident status despite their stays in the United States, particularly if the other factors listed above do not support such an intent. It also is important to note how the issue of maintaining permanent resident status often arises as a procedural matter. When a U.S. permanent resident applies for admission to the United States, DHS has the right and ability to question the foreign national regarding his or her maintenance of permanent resident status. Accordingly, a determination as to the maintenance of U.S. permanent resident status can be made “on the spot” at a U.S. port of entry. While the foreign national has the option of challenging an adverse determination from DHS that he or she has not maintained their U.S. permanent resident status, this is typically done through an appearance before a U.S. immigration judge. As can be expected, this process can be fairly time-consuming. As a result, it is far better to carefully plan for the maintenance of U.S. permanent resident status than it is to argue, after the status has been challenged, that one has maintained such status.
Reentry Permits An important procedural device which can be used by U.S. perma-
nent residents who are anticipating an extended stay abroad is the “reentry permit,” a document that looks like a passport that is useful to ease the reentry of the permanent resident to the United States after an extended stay abroad. The document is issued for up to two years, and additional reentry permits may be applied for by permanent residents who will be outside of the United States for an extended period of time. The reentry permit provides an upfront determination by DHS that the foreign national intends to keep his or her permanent resident status despite spending an extended period abroad. Because there is little downside to applying for the reentry permit, any U.S. permanent resident contemplating an extended stay abroad should do so.
U.S. Citizenship There are several requirements for a U.S. permanent resident to be eligible for U.S. citizenship through naturalization. These requirements include (among others) moral fitness, a test of the ability to speak and write basic English, and an examination of knowledge of basic U.S. civics and history. Two other important requirements, however, relate specifically to the duration of time spent outside of the United States. Typically, and with some exceptions, an applicant for citizenship must have been a permanent resident for five years and, out of that time, the permanent resident must have spent at least half of that time physically present in the United States. Accordingly, a permanent resident interested in citizenship must be mindful of the total amount of time spent abroad. However, the permanent resident also must be mindful of
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the length of the various periods of time spent abroad. For example, an absence from the United States by the permanent resident for one year or more breaks the continuous residence of the foreign national for the purpose of naturalization. Similarly, an absence of even six months or more breaks the continuous residence of the foreign national for the purpose of naturalization unless the foreign national can explain the absence to the satisfaction of DHS. The effect of this rule can be quite harsh. A U.S. permanent resident who is deemed to have “broken” their continuous residence for naturalization generally must start the five year clock over again on their return to the United States. While U.S. immigration law does provide for an
“extended absence benefit” to preserve the continuity of residence for naturalization, the benefit itself often is unavailable given the number and types of requirements that I will not elaborate on here. It is far easier, however, for the U.S. permanent resident to make a decision at the start of his or her stay abroad as to whether or not U.S. citizenship is, in fact, of interest and, if it is, to plan on returning to the United States regularly, and optimally, at least every six months.
Nonimmigrant Visa Holders U.S. immigration law provides for an “alphabet soup” of temporary U.S. visas, several of which include employer specific work authorization. Typically encountered categories
include the H-1B “specialty occupation” visa; the L-1 “intracompany transfer” visa; the E-1 “treaty trader” visa; and E-2 “treaty investor” visa. In general, a foreign national who holds a valid nonimmigrant visa is eligible to apply for reentry to the United States during the period of validity of the visa stamp. As a practical matter, it is a good practice to provide some leeway for a foreign national applying to reenter the United States, i.e., to not wait until the very last day that the visa stamp is valid, or close to it, for entry to the United States. This is particularly true given the fact that employees with very little time left on their U.S. visa stamp may need to have their employer almost immediately apply for an extension of their U.S. visa sta-
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tus if the stamp is soon to expire. After an extended absence from the United States, it also is a good practice for the employee to be provided with a letter confirming that the position previously approved by DHS remains available to the employee. It is important to note that workauthorized nonimmigrants may well be in the process of pursuing U.S. permanent resident status. It is important to carefully coordinate the steps the employer must undergo as part of this process with the travel plans of the employee. For example, a foreign national who may be eligible to apply for the last step of the permanent resident process through “adjustment of status” must be physically present in the United States to submit such an
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application. Alternatively, it also may be possible for the foreign national to obtain permanent resident status abroad through a process known as “consular processing.” As a result, the decision as to which process is to be followed is best made early in the permanent resident process and as part of an overall discussion regarding the foreign national’s near- and long-term travel and residence needs. In conclusion, an important part of the relocation process involves consideration of how and when the U.S. worker will be brought back to the United States. As we have seen, there is no U.S. immigration impact for U.S. citizens assigned abroad. Permanent residents must consider how to keep their permanent resi-
dent status and, if desired, their eligibility for U.S. citizenship. Nonimmigrants must maintain a valid U.S. visa stamp to return to the United States, and should coordinate their travel and living arrangements with the overall permanent resident process if they desire to become a permanent U.S. resident. Please note that this discussion relates solely to U.S. immigration issues and does not address in any manner tax or related issues. Further, this article does not constitute legal advice or create an attorney-client relationship, and readers must consult their own legal counsel. Matthew T. Phillips is chairman of the Global Immigration Group at Cohen & Grigsby, Pittsburgh, PA. He can be reached at +1 412 297 4860 or e-mail MPhillips@cohenlaw.com.
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Recruiting Foreign Workers in the United States
How to Remain Competitive and Ensure Compliance in a Climate of Increased Government Scrutiny BY SARAH L. TOBOCMAN, ESQ., GMS; JAY CARMICHAEL, ESQ.; LUCIANA C. MELO, ESQ.; AND MARIANA R. RIBEIRO, ESQ. The authors’ intent is to provide U.S. HR departments and in-house counsel with an overview of the recent trends and events in government oversight of worksite enforcement and scrutiny of U.S. visa programs; to highlight “best practices” that every organization should consider implementing; and to provide an update on several changes to U.S. immigration laws that benefit U.S. employers recruiting foreign nationals that may have gone unnoticed during the economic downturn.
response to the recent recession and high levels of unemployment in the United States, government authorities have sought to protect U.S. workers by increasing their scrutiny of employers’ compliance with U.S. immigration laws. Whether it is with respect to maintaining a legal workforce, or in the arena of employment-based visa programs, one thing is clear: there is an increased focus on employers’ compliance with U.S. immigration laws. As such, it is essential for HR teams to be well informed regarding the legal implications of hiring, maintaining, and terminating foreign workers in the United States.
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As the economy turns around, and hiring trends increase, U.S. employers will continue to use U.S. visa programs to remain globally competitive and fill critical highly specialized positions. In that vein, several changes on the employment-based visa front present “good news” and add flexibility for U.S. employers.
Maintaining a Legal Workforce: the New Focus on Enforcement of Employment Eligibility Verification (EEV) Obligations The Obama Administration has made it known that it will focus its efforts on employers’ compliance with employment eligibility verification (EEV) requirements as an entry point to investigations of employers that may be violating U.S. laws relating to maintaining a legal workforce. Whereas, during the prior administration, raids by U.S. Immigration and Customs Enforcement (ICE)— the enforcement arm of the U.S. Department of Homeland Security (DHS)—focused on detaining and removing individual undocumented
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workers, in addition to sanctioning employers, the new strategy seeks to take a more humane approach with respect to individuals while increasing civil and criminal enforcement of immigration-related employment laws with respect to employers and imposing tougher employer sanctions. Any comprehensive immigration reform that may be enacted is likely to keep employers at the forefront of a solution that ensures that only those legally authorized will be able to be employed in the United States. Since July 2009, in furtherance of the DHS’ renewed focus on targeting employers who break U.S. laws and knowingly hire illegal workers, ICE issued over 1,600 Notices of Inspection (NOIs) to businesses nationwide alerting them that ICE would be auditing their EEVs (Form I-9). This number represents a threefold increase of the 503 similar notices ICE issued throughout fiscal year 2008. Moreover, in March 2010, an additional 180 NOIs were issued to businesses in Louisiana,
Mississippi, Alabama, Arkansas, and Tennessee. Specifically, the audits include a comprehensive review of the companies’ Form I-9 to determine whether the businesses are complying with employment eligibility verification laws and regulations. Since 1986, all employers have been required by law to complete and retain a Form I-9 for each employee. The purpose of Form I-9 is to document that each employee is authorized to work in the United States. In reviewing such documentation, it is the employer’s responsibility to review original employment authorization documents presented by the employee and certify under penalty of perjury that the documents reasonably appear to be genuine and relate to the individual. The audits performed by ICE may result in civil penalties for substantive violations for knowingly hiring or continuing to employ individuals who are not authorized to work in the United States. There also are penalties for substantive technical violations relating to errors in the
preparation of Form I-9, known as “paperwork violations.” ICE considers several factors in determining penalty amounts, including the size of the business, the business’ good faith effort to comply, the seriousness of the violation, whether the violation involved unauthorized workers, and the business’ history of prior violations. Of even greater concern is ICE’s use of the Form I-9 audit as an entry point to initiate criminal investigations of employers. According to John Morton, DHS’ assistant secretary for ICE, ICE has identified Form I-9 audits as the most important administrative tool in building criminal cases and bringing employers into compliance with the law.
Participation in E-Verify E-Verify quickly is becoming the government’s standard for employers to demonstrate a commitment to comply with U.S. immigration laws relating to maintaining a legal workforce. Formerly known as the “Basic Pilot Program,” E-Verify is the government’s Internet-based program that allows employers to electronically verify the employment eligibility of employees, regardless of citizenship, by checking information contained in databases maintained by DHS and the Social Security Administration. As of May 5, 2010, more than 200,000 employers have enrolled in E-Verify, with more than 8.7 million queries run through the system in fiscal year 2009 and more than 8.8 million queries run through the system so far in fiscal year 2010. Although the use of E-Verify remains voluntary for most employers, several states such as Arizona, Mississippi, and South Carolina have passed legislation making its use mandatory for all employers.
On September 8, 2009, federal contractors and subcontractors became required to begin using the E-Verify system. The Federal Acquisition Regulation (FAR) Council’s rule requires federal contractors and subcontractors to agree, through language inserted into their federal contracts, to use E-Verify to confirm the employment eligibility of all persons hired during a contract term, and to confirm the employment eligibility of federal contractors’ current employees who perform contract services for the federal government within the United States. The three-year extension of E-Verify, which extends the program through the end of September 2012, was included in the $42.8 billion appropriations bill for DHS, which President Obama signed into law on October 28, 2009. ICE has made it clear that it would like to see EVerify made into a national standard for all employers. Thus, many predict that in the near future, the use of EVerify will be required for all businesses operating in the United States.
Enforcement Relating to the Use of U.S. Employment-based Visa Programs Fueled by a government study that uncovered fraud and technical violations in the H-1B visa program, federal officials have delivered on their promises of more rigorous compliance and enforcement efforts against noncompliant employers. For additional proof that employers are on the frontline in the enforcement of U.S. immigration laws, look no further than the revamping of the role of the U.S. Citizenship and Immigration Services’ (USCIS) Office of Fraud Detection and National Security (FDNS). Created in 2004, FDNS was formed to enhance the quality,
Best Practices— Minimizing Risk and Maintaining a Legal Workforce
n light of DHS’ renewed focus, and in order to reduce unauthorized employment, employers should consider implementing “best practices” to minimize their risk and maintain a legal workforce. Such “best practices” include: • use of E-Verify to verify the employment eligibility of all new hires; • establish a written hiring and employment eligibility verification policy; • institute an internal compliance and training program related to the hiring and employment verification process, including completion of Form I-9 and how to use E-Verify; • allow the Form I-9 and E-Verify process to be conducted only by individuals who have received appropriate training; • require that an annual Form I-9 audit be conducted by an outside source or, if within the company, by persons not directly involved in the EEV process; • establish and maintain safeguards against the use of the employment verification process for unlawful discrimination; and • if applicable, establish a protocol for assessing the adherence of “best practices” guidelines by the company’s contractors/subcontractors.
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integrity, and security of the U.S. legal immigration system. In 2009, in furtherance of its mission and the Administration’s focus on targeting employers who violate U.S. immigration laws, FDNS commenced an assessment of the H-1B visa program. The H-1B visa classification is for temporary employment of foreign professionals in specialty occupations, including, but not limited to, information technology professionals, business analysts, financial managers, engineers, architects, and allied health care professionals such as physical therapists, as well as fashion models. FDNS’ compliance review methods include review of public records and information, contact with employers via written correspondence or electronic transmission or telephone, and unannounced physical site inspections at the H-1B employer’s principal place of business and/or at the H-1B nonimmigrant’s work location. It has been reported that USCIS’ Vermont Service Center has transferred approximately 20,000 H-1B cases to the FDNS as part of the H-1B assessment program and it has been speculated that an additional similar number of H-1B petitions have been forwarded by USCIS’ California Service Center for such an assessment. In addition, in response to a letter sent to USCIS by U.S. Senator Charles Grassley (R-IA) on September 29, 2009, inquiring about aspects of the H-1B visa program and USCIS’ efforts to combat fraud in the program, USCIS announced that, among other measures, it plans to expand its Administrative Site Visit and Verification Program (ASVVP), which is carried out by the USCIS’ FDNS. USCIS commenced operation of ASVVP in July 2009 to determine whether the location of 40 MOBILITY/AUGUST 2010
employment actually exists, if the beneficiary is employed at the location specified and is performing the duties as described and is being paid the salary as identified in the H-1B petition. Initially, USCIS has been focusing the ASVVP on postadjudication H-1B site inspections. Information relating to noncompliance with H-1B program requirements could lead to revocation of a previously approved petition and/or referral to ICE for further investigation, which could lead to additional sanctions. As a result of FDNS’ ongoing assessment of the H-1B program, employers should review their H-1B program compliance policies and procedures. Furthermore, USCIS intends to access independent, open-source commercial sources to obtain information relevant to its adjudicatory process. For example, on September 30, 2009, USCIS announced that it had awarded a contract to Dunn and Bradstreet to act as an independent information provider for its new program, the Verification Initiative for Business Enterprises (VIBE). The VIBE program is an Internet-based service that uses commercially available data to verify information submitted by companies and organizations that petition to employ foreign workers. Although the date of implementation of VIBE is still unknown, on May 27, 2010, USCIS’ Office of Public Engagement held an information sharing session, which included a presentation of the VIBE program. Previously, it was anticipated that VIBE would have been implemented by the spring of 2010.
Enforcement of H-1B Obligations Another area where it is essential for HR departments and in-house
counsel to review current practices is with respect to compliance with regulatory obligations set out by USCIS and the U.S. Department of Labor (DOL) in the H-1B visa program. DOL regulations establish certain standards to protect similarly employed U.S. workers from being adversely affected by the employment of the H-1B workers, as well as to protect the H-1B workers. Moreover, both DOL and USCIS rules regulate terminations of H-1B employees. A prerequisite to obtaining the services of an H-1B worker is the filing of a Labor Condition Application (LCA) with the DOL. On filing any LCA, the company attests that it has met and will continue to meet certain requirements that are designed to protect the jobs and working conditions of U.S. workers throughout the period that an H-1B worker is employed. To support its attestations, the company develops and updates required supporting documentation for public access and government inspection. Pursuant to the regulations, the employer must make the filed LCA and necessary supporting documentation available for public examination at the employer’s principal place of business in the United States or at the place of employment within one working day after the date the LCA is filed with DOL. Inspection requests may include those made by a disgruntled former employee or the business’ biggest competitor. If the business does not have the required documentation available for public inspection, the company may be subject to penalties and even debarment from future sponsorship of H-1B workers. An additional rule of which many employers may not be cognizant is
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the DOL-issued regulation that provides that certain expenses directly related to the filing of the LCA and the H-1B petition are “business expenses” of the employer that may not be paid by the H-1B worker if the payment of these costs would reduce the H-1B worker’s wage below the “required wage.” The required wage rate is the higher of the employer’s actual wage for the specific employment and the prevailing wage. The reasoning behind this regulation is that if the H-1B worker is required to pay the expenses for the H-1B petition and accompanying LCA, this would cause a reduction of the wage paid to the worker, which would result in the wages being below those of other U.S. workers in the same occupation with substantially similar education and experience in violation of LCA regulations. Once the H-1B petition is approved by USCIS and the H-1B worker “enters into employment” with the employer, which occurs when the H-1B worker first makes him- or herself available for work or otherwise comes under the control of the H-1B employer, the H-1B employer is obligated to pay the H1B worker the required wage rate for the occupation listed on the H-1B worker’s LCA. The DOL has promulgated regulations that provide detailed guidance regarding the determination, payment, and documentation of the required wages. However, as referenced above, many employers still are affected by the recent recession in the United States and still are experiencing a lack of work and projects assignable to H1B workers, requiring the H-1B employer to place the foreign worker in nonproductive status. Placing an
H-1B worker in nonproductive status because of lack of work is prohibited. “Benching” is the term used for temporarily laying off an H-1B worker or putting the H-1B worker on nonproductive status without pay or with reduced pay during periods of no work. “Benching” is an employer’s failure to pay the H-1B employee his or her full rate of pay based on the employer’s lack of work, during periods between contracts, or after a downturn in business. In these situations, DOL regulations require the H-1B employer to pay the H-1B worker his or her full rate of pay as stated on the H-1B visa petition. An exception to this rule is when the H1B worker voluntarily requests a period of nonproductive status for reasons unrelated to employment, such as to tour the United States or to care for an ill family member. H1B employers still remain obligated to comply with the H-1B employer’s benefits plan or any other statute relating to employment such as the Family and Medical Leave Act or the Americans with Disabilities Act. Terminations of H-1B workers are another area of which employers should take note. Unless an employer effectuates a “bona fide termination of employment,” the employer may remain liable for H-1B wages well beyond the employee’s last day of employment. USCIS regulations provide that an H-1B employer who terminates an H-1B worker before the end of his or her authorized period of stay is required to notify USCIS of the termination, thus triggering revocation of the employer’s H-1B petition. To effectuate a “bona fide termination,” the H-1B employer also must offer the H-1B worker the
Best Practices— Complying With H1-B Program Regulations est practices” in support of employers’ good faith efforts to comply with USCIS and DOL H-1B visa program regulations include:
• reviewing approved and pending H-1B petitions to ensure that all the information provided to USCIS is current and correct; • creating and maintaining strict procedures to follow in the event of an onsite inspection by FDNS; • reviewing the LCA public access file and other documents that must be made available for both public and government inspection to ensure they are up to date and complete and that the employer is fulfilling all attestations made in the LCA; • developing a company policy with respect to H-1B petition preparation and LCA file maintenance; • implementing annual LCA Compliance Review Audits by an outside source to ensure compliance with DOL obligations; and • instituting an internal compliance a nd training program related to establishing and maintaining compliance with LCA requirements. MOBILITY/AUGUST 2010 41
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“reasonable costs” of return transportation abroad, generally interpreted as his or her last country of residence or home country. Thus, U.S. employers of H-1B workers should be aware of their obligation to pay the required wages to their H-1B workers, and that this obliga-
tion does not cease until there is a “bona fide termination” of H-1B employment. Although outside the scope of this article, it must be noted that other visa classifications also may require certain steps be taken by the employer when terminating a foreign worker.
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Remaining Competitive Through Recruitment Emerging from the recent recession, U.S. businesses understand that to remain competitive in today’s global marketplace, they must hire and keep the most talented employees. Often, the best candidates for these positions are foreign nationals. As briefly described below, a prudent and carefully devised strategy that considers available categories of work authorization and employment-based visas will enable U.S. companies to reap the benefits of skilled foreign labor, by remaining competitive while minimizing the risks. Because of the lapse in hiring that occurred during the recent recession, there have been several changes that provide flexibility to U.S. employers wishing to hire foreign nationals that may not have been on employers’ radars. Foreign students (F-1). There still is some confusion for many employers regarding the 2008 changes relating to employment of foreign students. On April 8, 2008, DHS published an Interim Final Rule that established two new provisions that apply to all F-1 students eligible for post-completion Optional Practical Training (OPT). OPT is training that is directly related to an F-1 student’s major area of study. It is intended to provide a student with practical experience in his or her field of study during or on completion of a degree program. Among other provisions, the DHS rule extends the period in which a student may apply for post-completion OPT to 60 days after the student’s program end date. Students with an approved 17-month extension will receive a total of 120 days of unemployment time during the entire period of post-completion
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OPT. Students eligible to receive a 17-month extension must be an F-1 student who has completed a bachelor’s, master’s, or doctoral degree in science, technology, engineering, or math, (STEM) and must have a job or job offer from an E-Verify employer. In addition, certain provisions of the rule also apply to F-1 students who are the beneficiaries of an H-1B petition and who (because of the cap on the number of H-1B petitions accepted in a given year) cannot begin employment until the beginning of the fiscal year following the fiscal year in which the H-1B petition was filed. Before this rulemaking, the F-1 status for these students often expired before their H-1B status began—a period known as the “cap gap.” Through this provision of the rule, DHS automatically extends the F-1 status and for students on post-completion OPT, the employment authorization for students formerly subject to the cap gap. Specialty occupations (H-1B). Unlike many other visa classifications, the H-1B classification is subject to annual quotas. For individuals who hold a baccalaureate degree or the equivalent, the annual quota is 65,000 a year, with 6,800 reserved for nationals of Chile and Singapore. There are an additional 20,000 visas for individuals with master’s degrees from an U.S. educational institution. In the years immediately proceeding the recession, H-1Bs were at a premium. USCIS typically ran out of baccalaureate-level H-1B numbers under the quota close to the outset of the application period, which commences April 1, of each fiscal year in anticipation of October 1,
start dates. However, in 2009, H-1B numbers remained available until December 2009. In 2010, H-1B usage has continued to be slower than in the pre-recession years as well. As of the time of the writing of this article, according to USCIS’
most recent update, USCIS had received approximately 23,500 capeligible petitions and 10,000 petitions for foreign workers with advanced degrees for fiscal year 2011. USCIS will continue to accept H-1B petitions until the annual quota is reached. Thus, employers
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that still have a need for new H-1B workers for fiscal year 2011 commencing October 1, 2010 should consult with immigration counsel as soon as possible to take advantage of the H-1B numbers while they are still available, and to carefully analyze those circumstances in which cap exemptions might be claimed. For example, requests for extensions of stay for current H-1B workers, amendments to H-1B petitions requesting a change in the terms of employment for current H-1B workers and change of employer petitions for individuals already in H-1B status do not count toward the cap. In addition, petitions for new H-1B employment are not subject to the annual cap if the foreign professional will be employed at an institution of
higher education or a qualifying related or affiliated nonprofit entity, or at a nonprofit research organization or a governmental research organization. Trade-NAFTA (TN). TradeNAFTA (TN) status is for professional workers from Canada or Mexico. The TN category is similar to the H-1B in the sense that it generally covers a wide range of job categories. These include accountant, computer system analyst, architect, graphic designer, medical/allied professionals, among many others. A change that may not have been on employers’ radars as a result of lessened hiring because of the recession was the 2008 change in the maximum period of time a TN professional worker may remain in the
United States before seeking readmission or obtaining an extension of stay. As a result of this change, eligible Canadian and Mexican TN nonimmigrants are now allowed initial admission and extensions of stay in increments of up to three years instead of the prior maximum period of stay of one year.
A Deeper Understanding As a result of the renewed focus placed by DHS on worksite enforcement of immigration issues, it is essential that employers’ HR teams and in-house counsel deepen their understanding of their obligations under both federal and state laws. In addition, businesses need to ensure that they are informed regarding their obligations under U.S. visa programs, such as the H-1B program, so that they do not inadvertently take employment actions that violate U.S. immigration laws. Adopting “best practices,” implementing internal compliance policies, and instituting annual training relating to U.S. immigration requirements are essential to remaining competitive and ensuring compliance in the current climate of increased government scrutiny. Sarah L. Tobocman, Esq., GMS, is chair of Gunster, Yoakley & Stewart, P.A.’s Immigration Practice Group, Miami, FL. She can be reached at +1 305 376 6065 or e-mail firstname.lastname@example.org. Jay Carmichael, Esq., is counsel to Gunster, Yoakley & Stewart, P.A.’s Immigration Practice Group, Miami, FL. He can be reached at +1 305 376 6090 or e-mail email@example.com. Luciana C. Melo, Esq., is an attorney for Gunster, Yoakley & Stewart, P.A.’s Immigration Practice Group, Miami, FL. She can be reached at +1 305 376 6086 or e-mail firstname.lastname@example.org. Mariana R. Ribeiro, Esq., is an attorney for Gunster, Yoakley & Stewart, P.A.’s Immigration Practice Group, Miami, FL. She can be reached at +1 305 376 6031 or e-mail email@example.com.
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Seven Essential Steps to Making the Right Relocation Pay Decisions
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BY SHARI DUNN Once the decision is made to move an employee to another site, not only do transition logistics need management, but a compensation plan must be created. Dunn offers a step-by-step guide to making the correct employee mobility pay decisions.
t is important to keep in mind that employers’ compensation plans generally are intended to result in actual base pay and/or variable pay levels that are: • Market-competitive—to attract and retain the best employees; • Internally equitable—to be fair and maintain high morale; • Cost-effective—to assure that compensation costs are optimal (neither too high nor too low); • Legally compliant—to not adversely affect protected class employees, and also to assure that overtime is paid consistent with applicable wage and hour laws; and • Motivational—to link base pay and/or variable cash compensation to solid measures of performance results. Given the significant costs associated with each employee relocation, it may be tempting to minimize the importance of getting the new salary right. For example, if the move for a homeowner employee will cost $76,600, the 2007 average cost reported by Worldwide ERC® (www.WorldwideERC.org/ Resources/Research/Pages/Facts-and-Statistics.aspx), adding a salary increase of $5,000 to $10,000 to be spread out during the following year may not seem like a lot of money. However, this is a short-sighted approach, as any such salary increase will not only be built into base pay costs for the long term, but also may result in internal pay inequities that could lead to employee dissatisfaction because of perceived unfairness, and even legal liabilities. Therefore, it ultimately is just as important to correctly set the new salary for the relocated employee as it is to manage the costs of the move itself.
The Cost-of-living Factor vs. Labor Market Indicators Often, employees and employers focus on the differences in the cost of living between the existing and new locations. Regarding effective pay decisions, however, it is most important to make sure that the new salary is consistent with the local labor market value for the job. The cost-of-living indicator most often used is the Consumer Price Index (CPI). This is a locationspecific indicator of the prices of consumer goods and services. While it may seem logical to keep an employee whole with respect to his or her spending power in the new location, such thinking can result in pay decisions that are inconsistent with the local labor market, as the two indicators do not always match. The CPI measures consumer costs that are determined by local supply and demand for goods and services. The labor market, on the other hand, is measured in terms of actual wages and salaries paid, which is a function of the supply of, and demand for, employees who are qualified to hold particular jobs. There are many metropolitan areas in the U.S. in which these indicators of inflation are very different. It also is helpful to keep in mind that keeping an employee “whole” after a move is a highly subjective concept. For example, an employee leaving a very large house in rural Texas may feel that his or her new, much smaller house in the San Francisco Bay Area is a lifestyle downgrade. However, the advantages of living in an area rich in cultural opportunities, major league sports, fine universities, proximity to the ocean, mountains, and wine country, not to mention temperate weather, may more than offset what might otherwise be a relocation disadvantage. The extent to which an employer wishes to compenMOBILITY/AUGUST 2010 47
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sate employees for relocating under different conditions should be welldefined, clearly communicated, and applied consistently.
Seven Steps to Making Good Decisions So, how can one best set the new salary (if it does change) for the relocated employee? Following are the easy steps to follow as you decide what base pay to offer your transferring employee: Educate yourself about your company’s pay plans. Check with your HR department and ask these questions: • Are all of the company’s jobs evaluated and classified into pay ranges and/or job values? If so, what is the job value or range of the transferring employee’s current job and new job? • Are geographic differentials established for each of the company’s different locations? If so, these should be applied to the job values. • What is the company’s policy and practice relative to salary adjustments? Find out what the transferring employee would be paid in the new job if he or she were already there. Assess the current situation with respect to the transferring employee. Determine which of the following situations apply: • Company is initiating the move for its own business reasons, usually
because the transferring employee has skills that are needed there, and/ or because the employee is on a career path that requires experience that is best acquired in a role at the new location. • Employee is initiating the move for personal reasons. If this is the case, the employer is under no obligation to pay any relocation costs, although such costs may be paid to a limited extent. Clarify the organizational situation at the new site. Assuming the company has a structured pay plan, find out the job values (or salary ranges) of the positions that are held by peers, supervisors and subordinates, as applicable. Also, obtain data on the actual salaries being paid to individuals in these positions, along with their performance ratings. If possible, compute the compa-ratios of all such future co-workers. A compa-ratio is actual salary as a percentage of job value (range midpoint). This will tell you if there is a correlation between base pay and performance. For example, if the top performers have compa-ratios in the range of 105 to 120 percent, while the lower rated employees have compa-ratios in the range of 80 to 95 percent, this will verify that salary administration at that location is based on performance, not just tenure.
In general, new employees who are expected to have a learning curve as they assume new responsibilities are paid between 85 and 95 percent of the job value. Determine what the transferring employee would “ideally” be earning at the new location if he or she were not relocating. This is a simple matter of computing an “ideal” salary as a percentage of job value, using the following scenario: if this is a lateral transfer to the same job as previously held, the employee already may be a fully competent or higher employee; if it is a new job, and a promotion, the employee is likely to require more development. Compute the salary adjustment. This often is a very challenging part of the process. Obviously, clear communication at all levels is essential. First, subtract the employee’s existing salary from his or her “ideal” salary at the new location. If a positive number, this results in the salary adjustment amount. If the number is negative, it means that the employee is currently paid more than what he or she should be for the new job. Although it generally is difficult to reduce an employee’s base salary in this (or any) circumstance, it may be necessary to do so for reasons of internal equity. Judgment should be used in making this
‘IDEAL’ SALARY AS PERCENTAGE OF JOB VALUE
PERFORMANCE AND/OR COMPETENCY LEVEL
113 – 120 percent
Top performer, exceptionally skilled, ready to be promoted
106 – 112 percent
Excellent performer, fully skilled
96 – 105 percent
Fully competent performer
86 – 95 percent
Not yet fully competent; employee requires more development
85 percent and below
Poor performer, not likely to succeed at job
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determination. If the amount is small, it probably is not worth the pain. If the reduction amount is significant, care must be taken to explain the decision carefully and to point out the potentially offsetting benefits of the move from a career advancement standpoint, as well as with respect to the one-time only cash payments and/or allowances that are likely to result in a higher standard of living. Alternatively, the decision may be made to freeze the individual’s salary until such time as labor market inflation or job evaluations may indicate that a higher salary is appropriate. Establish compensation policies specific to relocations. If policies and guidelines are clear and consistently followed, the need for case-by-case judgment calls can be minimized. Amounts and guidelines need to be set for some or all of the following: • reimbursement and/or direct payment of costs associated with the relocation itself, including moving, travel expenses, spouse visits, and the like; • reimbursement and/or direct payment of costs associated with homesale and purchase, including brokerage fees, new loan costs, staging, and so forth; • special, time-limited allowances and/or lump sum payments to offset such extraordinary costs as differences in dependents’ tuition, association or club memberships, household help, decorating and/or furnishing the new house, short-term income replacement and/or job-hunting expenses for the employee’s spouse, or other expenses that would not have been incurred except for the fact of the move; and • a relocation incentive.
Determine whether a relocation incentive payment should be made. The purpose of any such payment is to motivate the employee to accept the relocation without building in an ongoing salary cost, and without distorting the preestablished “ideal” salary for the job. It obviously would not apply to any employee-requested relocations about which the employer is indifferent. Whether such payments should be made will depend to a large extent on the degree to which the employer wants the transfer to occur. If the employee is reluctant to move, and the financial incentives such as a base pay increase, if made, are not valued by the employee, it may make sense to offer a one-time only payment as a “relocation incentive.” Analogous to what is commonly referred to as a “hiring bonus,” but would be intended to motivate an existing employee to take a new assignment. From an employee relations standpoint, one always should consider how successful any relocation is likely to be if the employee is unhappy about the move and is doing it only to receive the relocation incentive. A subsequent termination would prove costly in many ways. A better alternative might be to offer a “retention bonus” after a specified period of time on the new job, contingent on satisfactory performance. The relocation incentive amount can vary widely depending on the situation. It can be as much as 10 to 100 percent of the annual salary. Care should be taken to assure that any variation in such payments does not result in illegal pay discrimination. Shari Dunn is managing principal for CompAnalysis, Oakland, CA. She can be reached at +1 510 763 3774 ext. 102 or e-mail firstname.lastname@example.org.
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T H E
P R O M I S E
BY GALEN TINDER Personal branding is perhaps one of the most misunderstood ideas manifested by the Web 2.0 revolution. Tinder writes that it is a means by which a person establishes a consciously crafted and public professional presence and status in his or her field and the world at large, and personal brands articulate our distinctiveness in relationship to our colleagues and thus characterize the unique contributions that we can make to those who engage our services.
o question about it— personal branding is hot and is here to stay. Nonetheless, it understandably puzzles the uninitiated. To begin with, there is the name. Why is a phenomenon that is manifestly for professional purposes tagged as “personal?” For this, there actually is a good explanation. The “personal” in personal branding effectively distinguishes it from its corporate counterpart. In addition, personal branding
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does incorporate important parts of one’s persona. A second cause for confusion (not to mention skepticism) is that at a quick glance personal branding can be misconstrued as a gussied-up concoction of old-fashioned image making, which is, in turn, associated with falseness and hypocrisy. True— brands can be confused with images that may bear little relationship to the reality they purport to portray. We recently have seen examples of
fragile and now broken images in the worlds of politics and sports. As we will see, however, personal branding is not image-making because it grows organically out of who and what a person is. The essence of a personal brand is authenticity. A third potential distraction is the occasional treatment of personal branding as a job search tool. It certainly can function in this way, but its first and primary purpose is that of
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professional self-definition. A solid and properly built brand naturally will attract attention, admiration, and professional opportunities. On the other hand, waiting until unemployed to begin building a brand does not work.
What Is It? Personal branding is a means by which a person establishes a consciously crafted and public professional presence and status in his or her field and the world at large. Until recently, only wealthy and powerful people such as Jack Welch and Oprah Winfrey were able to cre-
ate “brands.” Technology has forever changed this and made branding a tool available to anybody with access to a computer and Internet connection. Our personal brand articulates our distinctiveness in relationship to our colleagues and thus characterizes the unique contributions that we can make to those who engage our services. A personal brand clarifies and demonstrates “what makes you different and special and includes your strengths, values, and passions,” according to William Arruda, a personal branding expert, on http:// williamarruda.sys-con.com/.
A personal brand not only embodies our identity and capabilities but effectively communicates this representation consistently across a multiverse of intertwining platforms such as LinkedIn, blogs, Twitter, and Facebook. Our brand pulls together and integrates our personal qualities and professional abilities into a single entity that functions as a promise of value to others. Thus, while our brand is a competitive tool in the marketplace, it is far more than an image. Meg Guiseppi is among a handful of people who is at the forefront of the branding movement and has
The Historical Context of Personal Branding ne way to spot an important trend and distinguish it from passing fads is to determine whether it grows out of an historical development and is tied to the dynamics of future change. Personal branding has no trouble establishing its bona fides as a product of historical evolution. To understand the position and power of personal branding it is useful to see its rootedness in three broad changes spanning the last 40 years of U.S. history. The first was economic, the second societal, and the third technological. • The heart of the baby boomer cohort was in college when the United States experienced its first massive layoffs in the early 1970s. Today, layoffs are an assumed part of life but 40 years ago it was shocking when economic pillars such as AT&T and IBM let go thousands of people in one or two fell swoops. These and following “reductions in force” permanently shattered the implicit assumptions of employer-employee loyalty. No longer could we look toward employers as guarantors of life-long employment and personal economic stability. Under this evolving new order, employees began taking command of their own vocational destinies. • As individual workers took responsibility for their careers, experts in career and job search led the way toward a new
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understanding of work as a source of human satisfaction and meaning. At the time, not many of us realized how startling a break this was from traditional conceptions. For centuries, work was conceived of principally as a social duty, a burden of responsibility, and a taking of one’s proper role in the divinely determined order of things. Seldom had work been considered an intrinsic source of personal significance and satisfaction. But the breakdown of traditional economic relationships helped trigger a revolutionary reexamination of the purpose of work that elevated individual choice and initiative and empowered people to define their own career direction. One of today’s byproducts of this emancipation is that we now spend an average of only three to four years in the same job and five to six years working for the same company. • As these two trends entrenched themselves in the developed world, we were convulsed by a communication revolution that is still hurtling forward at a torrid pace and transforming the ways in which human beings communicate with and relate to each other. Technology has multiplied the means and the reach of individual self-expression on every imaginable level and in doing so has given us the tools for personal branding with the touch of a computer “on” button.
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done more than anybody to apply personal branding to the development of career identity and attainment of vocational success. She writes on her website, http://executivecareer brand.com that, “personal branding links your passions, key personal attributes, and strengths with your value proposition, in a crystal clear message that differentiates your unique promise of value and resonates with your target audience.” The “value proposition” and “unique promise of value” that Guiseppi speaks of consists of what we can accomplish for whatever cause, client, or company that hires us or engages our services. Thus, personal branding joins together what is most deeply real and compelling about ourselves with our definitive accomplishments to date in an effective strategy for professional fulfillment and success. And it puts us firmly in the driver’s seat. We cannot go to an ad agency or image maker for a brand.
How to Get a Personal Brand “Getting” a personal brand cannot be done quickly. To have a brand requires an interactive process of reflection and, in time, the process flowers into a broad selfrepresentation in social media. Each person’s path to a fully embodied brand is unique but most share common elements, particularly when starting out. Traditional career exploration might include: Self-exploration and reflection. • What are my values? • How and where do I find meaning in life? • What am I passionate about? • What distinguishes me from others in and out of my field?
• In what environments do I function most effectively? Conversations with others— how are we seen by those who know us. The ongoing development of even a mature brand involves constant dialogue with a larger community. Consulting online social media branding experts such as Meg Guiseppi, William Arruda, and Dan Schawbel for an understanding of how brands function. Experimentation to finetune one’s passion and establish its niche. The production of foundational written documents like a résumé. Brand articulation across a spectrum of social media. In the stages of initial brand development it may be helpful to zero in on four career documents: 1. A value proposition—a brief, compact statement about who you are and the value you can deliver. 2. Your elevator pitch—this is a longer elucidation of the value proposition and though it is good to write it down for precision and fine-tuning; you usually will communicate it orally. 3. Your résumé. A branded résumé has a clear focus that articulates, highlights, and illustrates a personal brand. 4. The cover letter—every cover letter should be uniquely branded for each application. For most people, these documents have constituted their entire job search arsenal. For those in the stage of brand building, they are an important foundation for the critical work that lies ahead. For information on branded résumés see the resource list on page 55.
4. 5. 6.
Social Media Branding inkedIn, important though it is, presents only one of many social media venues to use for personal branding. It would be overwhelming to list them all here and a full-time job to keep up with them. But here is a list that many experts recommend considering at the outset. • Twitter; • Facebook; • commenting to blogs and message boards; • guest blogging; • operating and writing a blog; • participating in discussion groups; • creating a visual CV with links to some of the above; • creating and maintaining a website with links; • posting work and work projects online; • joining and contributing to professional groups through LinkedIn; and • taking advantage through these communication platforms to help others by sharing your expertise.
The Personal Brand in Virtual Reality If you are new to personal branding and have surveyed all the ways to communicate with others online, you know about two of the challenges you face—where to begin and where to stop. The first dilemma is the easier to answer. Begin with LinkedIn. Join MOBILITY/AUGUST 2010 53
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and within a week post a complete profile. Complete means a picture because without it many people will not take you seriously. Also, get three recommendations. They do not need to paint you as a saintly master of the universe or be of Tolstoyan length. Most are a paragraph and focus on the recommendeeâ€™s strong points as experienced by the recommendation writer. Whether it is worth your while to participate in all of the social media listed in the sidebar and others not listed will depend on your particular circumstances, such as whether you are functioning as a free agent entrepreneur or are employed by a company. Some people choose to plunge into social media while others are comfortable taking it slower. For example, one can get a profile up on LinkedIn, join and contribute to a few of its groups, and participate on blogs and discussion groups without swinging into a full-blown personal branding campaign. Some people raise their level of social media participation slowly and suddenly find that they have established a nascent brand to which others are responding. Before you take the plunge or dip your toe in the water, let us review several social media/personal branding basics. Consistency. It is a truism that a brand requires consistency of presentation. To use an example from the corporate sphere, we are unlikely to see Walt Disney Company sponsoring World Wrestling Federation bouts or walk into a Borders or Barnes & Noble bookstore to encounter racks of used lawn mowers. Translating this into the realm of personal branding in the most obvious way, you cannot expect your brand to thrive if you are presenting 54 MOBILITY/AUGUST 2010
one person on LinkedIn and another on Facebook. In fact, recently some professionals have begun to hide their playful, naughty Facebook profiles from the public. Digital dirt. This brings us to the topic of digital dirt. Picture Google and other search engines as gigantic vacuum cleaners that suck up, categorize, and display every piece of information they find. Much of this may go unnoticedâ€”that is until a potential employer or client searches your name to see what comes up. What may come up are photos that somebody you never met took and posted (so easily done in the digital age) of you the time you drunkenly climbed out your second story college dorm and landed in the flower garden below. Or, a search engine
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may unearth rash and intemperate comments you made in a 10-year-old letter to the editor of your industry’s professional publication. This is the kind of informational flotsam that hiring managers can turn up with a few clicks. Unfortunately, there is not much we can do about such shards from our past except know that they are there and be prepared to speak to them if asked. Meanwhile we can populate the search engines with comments on blogs and discussion groups so that questionable information is less noticeable. Generosity. We spoke earlier of the distinction between image-
making and personal branding. The spirit of personal branding is characterized by giving and the sharing with others of one’s own experience and expertise. The more a person gives, the more solid his or her brand becomes. In this way generosity does more for self-branding than the blinkered pursuit of self-interest. Authenticity. The bedrock of personal branding is the authenticity of our brand and our contributions to the virtual conversation. Social media does not—especially over the long haul—make a welcome home for crass and duplicitous self-promotion that presents an image we are selling
Key People in Personal Branding Meg Guiseppi – http://www.executiveresumebranding.com William Arruda – http://www.williamarruda.com, http://www.thepersonalbrandingblog.com Dan Schawbel – http://www.//danschawbel.com Hubert Rampersad – http://www.rampersad.wordpress.com
Websites on Social Media and Personal Branding http://mashable.com http://www.job-hunt.org/personal-branding/personal-branding.shtml http://www.careerrocketeer.com http://online-social-networking.com/are-you-building-yourpersonal-brand-and-future-around-your-passion
LinkedIn http://jobsearchtech.about.com/od/jobsearchtools/a/LinkedIn.htm http://jobmob.co.il/blog/gigantic-linkedin-job-search-tips/ http://imonlinkedinnowwhat.com/
Twitter http://www.personalbrandingblog.com/30-minute-brand-building-for-twitter http://www.twitip.com/personal-brand-how-to-build-yours-in-twitter http://www.careerrocketeer.com/2009/07/20-personal-branding-tips-for-twitter.html
Facebook http://mashable.com/2009/04/02/facebook-personal-brand http://mashable.com/2009/09/29/facebook-personal-brand-strategy http://www.facebook.com/personalbranding
rather than a brand that reflects our true character and abilities.
Conclusion–Citizens of the Virtual World Personal branding got its start in the United States but it already has spread through much of Europe and is quickly making inroads in other parts of the world. It soon will be a global phenomenon. This geographic spread will be accompanied by its broadening vocational applicability. Originally, social media was the province of marketing specialists but then grew to include executives in numerous lines of business. It is now encompassing professions like engineering and attracting entrepreneurs of all stripes. It is being adopted, for example, by service professionals such as computer repair technicians, booksellers, caterers, tanning and hair salons, and architects. Some refer to it as a new means of job hunting but, in many instances, it can preempt the job search by attracting to one’s online presence the attention of potential employers who are scouring the Internet in search of the right people for open positions. Finally, social media is profoundly democratic. It opens up the world of careers, professions, and job search to anybody who is interested and, pulling us into a maelstrom of information and conversation in which we are both learners and teachers. We are not judged by the number of degrees after our name, the number of books we have published, but by the quality of our contributions and actions. Galen Tinder is senior consultant and manager for Ricklin-Echikson Associates, Inc. (REA), Millburn, NJ. He can be reached at +1 973 376 2020 or e-mail email@example.com. MOBILITY/AUGUST 2010 55
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10 Ways to Boost Your
Relocation Brand Online BY ANDREA MARTINS
Martins says start developing an online strategy by committing to the following 10 approaches to give your company the online boost it deserves.
elocated families love the Internet. It feeds their need for information about new destinations and keeps them â€œconnectedâ€? with friends and family when their companies transfer them miles from home. Logic follows that if your mobility-related business is trying to tap into the valuable online relocation market, you need to be online media savvy to know how to best reach your target customers. 56 MOBILITY/AUGUST 2010
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Ideally, you will develop an online marketing strategy. You will do your research and learn from key players in the online media world. You will find out what your competitors are up to, decide what you believe to be “best practice” for your industry, then match these ideas with your company’s goals (such as increasing brand awareness, increasing customers, and/or improving your credibility as an industry authority), values, mission, resources, and time constraints. However, if a comprehensive strategy seems too daunting, start by committing to some of the approaches below and give your company the online boost it deserves. Improve your website. Your ultimate online marketing goal should be to lead people back to your own mobility company’s website. This means that before spreading your wings online, you need to critique the “stickiness” of your own website to assess if people would want to stay on your site when they arrive. First impressions count: Is your site easy to navigate? Does it succinctly explain how you can help? Do you have photos of “real people?” Will someone know how to contact you? How can you seek feedback and what changes can you make today? Cost-saving tip: You do not always need a full website overhaul: sometimes the simplest update can increase the number of visitors and/or inquiries a business receives. Optimize your site. To improve your site’s search engine ranking, it is a good idea to invest in search engine optimization (SEO). SEO, most often outsourced to a professional webmaster, involves assessing and enhancing technical facets of your website (such as page titles, meta-tags, keyword usage, site maps, page rankings, and more) so that it appears higher on search engine results lists. Cost-saving tip: One piece of advice that could save you thousands of dollars: instead of paying for an ongoing SEO package (which seems “mysteriously essential” when presented by an external web firm), ask first for an SEO audit. This means that you will
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(because typically they send impersonal, standardized requests that not only frustrate website owners, but do more damage to your brand than good). Submit articles. Most employee mobility and expatriate sites welcome voluntary article contributions. Given that this is your company’s area of expertise, this is an excellent opportunity to demonstrate your knowledge, earn some audience trust online, get a free link back to your site (often, on a site that would not have otherwise given you a free link) and keep your business up-to-date and on its toes. To get started, offer articles to website owners already in your network. Then, search key terms online such as “relocation,” “mobility,” “real estate,” or “expatriate,” and offer articles to the sites that rank the highest on your search results. Insider’s tip: Try to retain the copyright for your contribution so that you can submit your article to other sites and publications as well. Then do so as soon as possible. Blog your way to the top. Many companies have boosted their online reach via a clever, personable blog. Relocation blogs can establish your/your company’s authority, as well as act as an online repository of useful mobility industry news snippets, which, again, fosters your/your company’s credibility. Participating in a value-add capacity on other blogs also can benefit you/your business. An increasing number of blogs (and mainstream websites) have a growing need for useful content but a shrinking capacity to write said content. Insider’s tip: Do not ignore the power of blogs. Google searches
pay a professional SEO firm to go through your entire website and then give you an audit of your site’s performance—clearly articulating how your site can improve, especially with regard to your audience. Then, with report in hand, you can go through and decide what you might do internally, what you need to outsource, what needs to be done immediately, and what can be done in your next budget cycle. Get linked on related websites. The general rule is to get your website legitimately linked on as many relevant websites as possible. To get through the gatekeepers (who receive dozens if not hundreds of website link requests daily) of the large websites, make sure that your website is indisputably relevant and/or be aware that sometimes you might need to pay for the privilege of a link on someone else’s site. Insider’s tip: If you engage a professional “link master” to help get your site linked on multiple other sites, check how your link master will personalize your link requests
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blog entries and comments (especially those on Blogger.com—a Googleowned platform) on a daily basis and, believe it or not, sometimes these blog conversations end up higher up on Google’s search result rankings than normal company websites. Share your wisdom. Discussion groups can be a great, low-cost way to share your relocation wisdom and to spread your business name among online relocation communities. The more involved you get, the better your knowledge of the relocation audience and the more ideas you might generate to service your own relocation customers’ needs. Insider’s tip: The key to credibility in online discussion groups is to listen, make sure that anything you say is relevant, and avoid over-the-top promotion of your brand. Be a credible expert. The more visible you are online, the more credible you need to be. Not just your company, but you personally. The best way to do this is to build a “100 percent complete” LinkedIn profile that reinforces your “relocation-related” experience and expertise. Insider’s tip: Aside from the credibility factor, LinkedIn can help you grow your network of business contacts enormously. For example, if you connect to 100 people and those 100 people are on average connected to 100 people, that is 10,000 contacts in your network that you could potentially access and/or influence. Think social media. The beauty of social media is that it offers everyone—and every business—a genuine chance to listen to what is being said and to have a
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voice online. Right now, the rage might be Facebook, LinkedIn, MySpace, Twitter, YouTube, and social bookmarking sites such as Delicious, Digg, StumbleUpon, Reddit, and FriendFeed, but, whatever the site(s) of the moment, try to dedicate at least part of your week to learning more about social media and how it can help to grow your relocation business. Insider’s tip: One lesser-known social media site that has a great concept is Help A Reporter Out (www.helpareporter.com), which started as a Facebook group. Sign up to HARO and if you can help journalists with their press requests, your business could score some priceless, free publicity—both online and offline.
Pay attention to Facebook. With 400 million users and growing, every company should be paying attention to Facebook—the world’s largest social networking site. There are three main ways to get involved in Facebook. 1. Set up a fan page for your business (www.facebook.com/pages/ create.php). 2. Become more active on your personal Facebook page (which can, in turn, help your business). 3. Advertise. Insider’s tip: Many people check Facebook more than e-mail. Advertise online. Online advertising offers literally endless possibilities. The most well-known online advertising channel, Google AdWords, is
still popular. LinkedIn is starting to interest people. But today’s buzz is really around Facebook advertising— because it works—or at least it has for me and many other businesses. Facebook advertising allows you to pinpoint your target audience by age, gender, education, location, languages spoken, relationships, interests, and more. What business is not interested in potential customer segmentation that is this specific? Find out which sites your customers are frequenting and advertise there. The benefit is the endorsement of an already trusted online community that can save you a lot of time in online credibility building. Bear in mind, however, that not all sites have the same target audience. Some sites are global, some target a
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specific geographical area or nationality, some are divided by gender or content type, some are online community-oriented, and some are more news-oriented. Before investing in online advertising, research your audience and choose your site(s) wisely. Insider’s tip: Ask the site that you are advertising on if they can track the clicks that your advertisement receives. If not, you can accurately track click-throughs yourself if you ask your webmaster to (take one minute to) set up a dedicated landing page on your site, such as www.[your site].com/[name of site that you advertised on], then direct all click-throughs from your advertisement to this specific landing page.
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Be Seen, Be Rewarded Boosting your online presence is all about helping more potential customers find your business, then relaying a sense of online credibility that will encourage the conversion of those new leads into tangible business revenues. As Juliette Powell in “33 Million People in the Room” says: “Visibility and reputation affect the decisionmaking process, and at the end of the day, they influence behavior.” In other words, be seen more online (on sites that your target customers patronize) as a credible authority and watch your business be rewarded. Andrea Martins is the director and cofounder of www.ExpatWomen.com, currently based in Kuala Lumpur, Malaysia. She can be reached at firstname.lastname@example.org.
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BY STEFANIE R. SCHRECK, CRP, GMS
When an employer offers temporary housing accommodations to its mobile workforce, the employee rarely has input into the location or type of home in which they will live. Schreck writes that understanding the needs of employees will aid in selecting the most suitable housing, and the key components in housing selection revolve around expectations, location, amenities, transportation, and booking and billing.
hen a company provides temporary housing to relocating employees or to employees on business travel, often the employees have little input as to the location or type of home in which they stay. While it is common for companies to limit a relocating employee’s time in temporary housing, they may feel that their selection is appropriate to limit costs or to provide comparable accommodations to all employees. Employees on extended business trips may feel at more of a disadvantage staying in a furnished apartment, as they do not have any motivation to assimilate into the destination location. Understanding the needs of people from other cultures will aid in securing the most suitable housing for employees.
Expectations Sean Dubberke, cross-cultural program coordinator, RW3 CultureWizard, New York, NY, advises, “the biggest issue that I’ve noticed in interviewing expatriates for cross-cultural programs is the overwhelming feeling many get from the abundance of choices and options one has in the U.S. It’s good to prepare them for this. I like to describe going to the supermarket and having hundreds of different types of dry breakfast cereal or going to a sporting goods store and having dozens of athletic
shoes to choose from. This is a hallmark of American individuality and consumerism, which is quite unique in the world. It may be delightful for tourists to experience this, but it tends to be overwhelming for expatriates on a daily basis.” Dubberke further advises that expatriates may be familiar with U.S. film, TV, and music; but not understanding that these images are not reality for many U.S. residents warps their expectations of daily life. “The biggest surprise may be the large size of homes and apartments, which, again, marks the American dream of having space and room for acquiring material possessions, which reflects one’s status,” he said. Dubberke suggests providing a preparatory pamphlet outlining the norms of U.S. life (in and out of temporary housing) so that shock is less pronounced post-arrival. Topics he recommends that are addressed include: • Extended family members usually live in separate housing. • Children move out of the house often at age 18, or when they go to college. • Most Americans are self-sufficient in maintaining and cleaning their homes. • Cooking at home may not be the preferred option, given the vast array of prepared food eateries in most American cities (NYC/urban perspective).
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Further, to prepare expatriates for the realities of life overseas, Dubberke says a key piece of the puzzle is to help expatriates understand the different emotional phases one goes through during relocation. Setting realistic expectations for expatriates or employees on extended business trips may reduce the culture shock they experience on arrival in the host country. 64 MOBILITY/AUGUST 2010
Dubberke explains, “it is important to scope out the individual’s social needs in advance of a move to determine the best area of a city for that person to live in temporarily. For example, there are grouporiented or collectivistic cultures, including many of those in Asia, such as China, India, Thailand, and Korea. A suburban location for a group-oriented culture is not conducive to making friends and meeting new people. Suburban zones can be isolating, so expatriates should be prepared for this.” Beth Searls, vice president of sales and marketing for Furnished Quarters, New York, NY, agrees that determining the location of the apartment may help employees be more comfortable in temporary housing. For example, she says that “there is a strong Indian community in Jersey City, and we try to place these guests in our Jersey City properties. It has worked out very well and we frequently have requests for these locations from unrelated companies due to our guests’ networking.” Patricia Hintze, vice president, client services, Marriott ExecuStay, Hobe Sound, FL, acknowledges, “the inability to socialize is often a problem, so for larger groups we will provide a monthly social event so they can spend time with other guests. Many of our markets also provide details on local events that are happening so these travelers can choose some events to participate in.” To further address the concern of socialization, Searls indicates that they also send a weekly newsletter “to all our guests in New York City, New Jersey, and Boston that includes cultural activities and local things to do.”
To enhance the comfort for overseas guests, Searls says her company provides rice cookers for visitors from Asia and electric tea kettles for visitors from the UK, as requested, as well as offer international cable television stations for specific nationalities. “We tailor any amenity we might provide to the nationality of the guest. As an example, on occasion, a guest may experience some kind of inconvenience and we would send an amenity as a gesture of good will. Just yesterday we sent German cheese and wine to a guest from Germany.” Dubberke advises, “people from countries where domestic help is common or expected by executives and other managers (e.g., cooks, nannies, maids, drivers, and the like) find the lack of this in the United States difficult. Doing one’s laundry and operating a washing machine also may not be easy for international assignees used to affordable, fullservice laundry in the home country. It is probably valuable to the international assignee to have a packet of information on where to find exactly what he or she needs to continue living comfortably by somehow assessing their living situation in the home country.” Searls adds, “we provide information when guests arrive on how to use the appliances (washer/dryer, dishwasher, and the like); we have had guests try to use the garbage disposal as a blender and put Palmolive in the dishwasher.” Further, Hintze advises, “each guest receives a walk-through of their new apartment home with a member of the local ExecuStay staff. This walk-through is scheduled on a day and time that is convenient
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for the guest and, preferably, within a day or two of arrival. They are given an overview on how the appliances work, how to work the television remote control. They also have an opportunity to ask questions about the apartment, the community, the neighborhood [and the like].”
Neighborhood/transportation Searls indicates, “on arrival, we provide welcome packets with information about the neighborhood and area, including a map and list of local establishments such as grocery stores, restaurants that have the flavor of whatever the guest’s particular nationality is, banks, [and the like].” Hintze says that “transportation can be a major challenge. Whether it is using public transportation or navigating highways, in a rental car, it is usually a major hurdle to overcome.” Dubberke confirms, “transportation is another contentious issue with foreign nationals. Navigating in a car or using mass transit implies many things. A good ‘settling-in’ counselor will set realistic expectations for international assignees.” Hintze says, “in urban settings, we always provide an overview of the transportation system and, if they are driving, we will offer maps [and so forth]. Recently, we did have a group coming from India to our Wilmington market and we actually arranged for a private bus service to pick up the 12 travelers every morning and bring them home in the evening, since the public transportation was causing such concern. We also notice that the age of the traveler also plays a part in all of this. The younger travelers are more willing to go out and try things and seem to
quickly make friends and acclimate to their surroundings. Middle-aged travelers and those with families tend to have more challenges.”
Booking/billing Searls indicates, “during the booking process and while international guests are with us, we often communicate in their own language. Through our staff, we have the ability to converse in about 15 languages. For what it’s worth, we are very flexible with billing and payment as it can be a little more challenging with international guests. We had a group from India that needed to pay with traveler’s checks and our staff went to their offices to manage the payment transaction and make it as convenient as possible.”
Moving Forward In response to customer surveys, Searls advises that, “we all agreed we needed to amend our website to include key information in multiple languages. As we know, the availability of information in one’s native language makes international travelers more confident and at ease when communicating. Besides being surrounded by familiar food, customs, and culture in general, nothing makes an international traveler as comfortable as being able to use their own language, if necessary.” Hintze concludes, “we find that this personal touch really makes a difference and helps overcome some of the normal challenges that occur when spending an extended period of time away from home.” Stefanie R. Schreck, CRP, GMS, is manager of corporate relocation for American International Group, Inc., New York, NY, and a member of the MOBILITY Editorial Advisory Committee. She can be reached at +1 212 770 8094 or e-mail email@example.com. MOBILITY/AUGUST 2010 65
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Making the Big Move:
Relocating to Singapore
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BY SIEW KIANG NG Officially the Republic of Singapore, this island city-state in Southeast Asia is an international hub of finance and trade. Ng discusses career opportunities in Singapore and the countryâ€™s openness to talent, as well as key considerations when relocating, including cost of living, taxation, housing, health care, education, banking, and communication. orking professionals today are becoming more mobile than ever, living in different cities across the globe at the various junctures of their careers. Mobility is a major decision, and career advancement and personal aspirations often are the main factors that come into play.
Career Opportunities in Singapore With Asia slated to be the next major growth region, many are looking east. Singapore often is one of the top destinations for relocation. An island city-state in Southeast Asia, Singapore continues to have a strong economy and experienced employment growth in 2009 despite the global recession. This is evident through the efforts of the Singapore government to continue to grow and develop its key industries, thereby creating career opportunities for people in Singapore and global talent who wish to partake in the countryâ€™s growth. Singapore has identified several growth industries that it will focus on developing. These include biomedical sciences, interactive and digital media, and clean technology. In addition, established industries such as financial services and engineering and technology continue to be open to talented individuals. Singapore recognizes that its key competitive advantage lies in its talent base and it has set in place a talent-friendly environment.
Openness to Talent Singapore has adopted the vision of developing itself into a global city in Asia, one that offers high value-adding jobs and opportunities for people to stretch their potential. Today, one in three people working in Singapore is a nonresident. According to the IMD World Competitiveness MOBILITY/AUGUST 2010 67
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Yearbook 2008, Singapore immigration laws for foreign talent are the least restrictive in the world. Singapore aims to become the best home for talent.
Key Considerations in Relocating Working professionals who are ready to make the move also are faced with many key considerationsâ€“ from career opportunities, cost of living, and taxation issues, to housing, health care, transport, banking services, education for children, language, and social support. Professionals who choose to move to Singapore do so for its central geographic location in the center of Asia, political stability, international and multicultural environment, excellent education and health care
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system, and its attractive taxation rates and quality of living.
Cost of Living Living in Singapore is much more affordable compared to many developed countries such as the United States and United Kingdom. Where else would you be able to have dinner at a cost of US$3? Using the Big Mac Index (http://www.oanda.com/ currency/big-mac-index) as an example, the price of a Big Mac was US$3.57 in the United States compared to S$4.22 in Singapore (as of July 16, 2009). The implied purchasing-power parity (PPP) was thus 1.18. The PPP compares the standard of living between countries by taking into account the effect of their exchange rates. Compared to an
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actual exchange rate of 1.4, the Singapore dollar was undervalued against the U.S. dollar by 15.5 percent. Put simply, what this means is that the same Big Mac that costs US$3.57 in the United States would cost only US$3.03 in Singapore.
Taxation People working in Singapore find that they have higher disposable incomes because of the attractive personal tax rates. Only personal income derived from Singapore is taxable at progressive tax rates of 0 percent to 20 percent for tax residents and a flat 15 percent for non-resident individuals or the resident rate (whichever gives rise to a higher tax amount). A tax resident in Singapore who earned S$100,000 in 2009, for instance, would pay only S$7,100 in tax. Conversely, a tax resident in the United States who earned US$100,000 in 2009 would pay between US$15,000 to US$35,000 in tax.
Housing Matters There is a wide selection of accommodations in Singapore ranging from houses to serviced apartments, condominiums, and public housing. Property and rental prices depend on key considerations such as location, age of the property, amenities, proximity to malls or rail stations, size, and so on. There are no restrictions on the types of residences that foreigners can rent. However, the Singapore government has certain policies for foreigners purchasing landed property and public housing. Unlike many other countries, public housing in Singapore is of high quality. In fact, 83.5 percent of Singaporeans live in public housing.
o ensure that your move to Singapore is free of hiccups, here is a checklist of things to note before your arrival.
Financial Matters • Complete all taxation and legal matters that will affect you and your family. • Arrange for medical insurance. • Set up a bank account. Travel Plans • Check with the Singapore embassy in your country as to whether you need a visa to enter Singapore. • Make sure your passport is valid for at least six months from the day you plan to enter Singapore. • Settle your travel and accommodation plans. • Engage a relocation or moving company. • Arrange for schools for your kids in advance—some international schools have long waiting lists. • Inform relatives and friends of your change of address; give them your new contact details. Important Documents • Birth, marriage (or divorce) certificates for the entire family. • Identification card. • Medical and dental records, including inoculation records. • Medical prescriptions. • Pension and insurance records. • Recent bank statements. • School diplomas and reports (for children). • Update résumé and letters of recommendation. • Employment contract and copies of previous employment contracts. • Driver’s license. • Passport photos. Customs • Make sure the items you plan to bring with you meet Singapore customs regulations; some items are dutiable, others are prohibited by law. • Make sure your electrical items follow the British system or else, bring an adapter.
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outpatient medical services to inpatient care in hospitals and specialized institutions. Nevertheless, health care in Singapore still is affordable. For instance, a heart bypass in Singapore would cost about US$15,000, compared to US$75,000 in the United States. Public health care in Singapore is subsidized by the government and rates tend to be lower than those at the private clinics and hospitals. There also are differing levels of subsidies given to citizens, permanent residents, and foreigners. Most companies provide group medical insurance for their employees, who also can choose to take up private medical insurance offered by the many reputable insurance companies in Singapore. These can range from basic to comprehensive coverage at varying prices.
In a 2008 survey conducted by Singaporeâ€™s Housing Development Board, more than 80 percent of respondents replied that they are proud of their flats. Residents like the location of their flats, transport facilities, and estate amenities.
Medical Facilities Singapore has excellent health care facilities, making it a popular destination for medical tourists from around the world. Both public and private health care facilities are well-equipped and of a high standard, ranging from 70 MOBILITY/AUGUST 2010
For those with school-age children, one can rest assured that Singapore takes education very seriously. The quality of schooling here is among the best in the world. Parents can choose to place their children in a national school, an international school, or a school that follows closely to the system and syllabus of their home country. Admission for entry into the national primary and secondary schools and junior colleges is centralized by Singaporeâ€™s Ministry of Education, which conducts the Admissions Exercise for International Students (AEIS) around September or October each year for new international students. School fees will differ depending on whether one is a Singapore citizen, permanent resident, or international student. For entry into international or foreign
system schools, parents can contact the schools directly.
Getting There Getting around Singapore is easy thanks to a systematic and integrated land transport master plan that incorporates an efficient rail and bus system, a carefully designed road and traffic structure, and controlled car ownership. Car ownership in Singapore can be expensive because of a need to control the number of vehicles on the road to reduce congestion. There is really no need to own a car. Regular bus services are provided at regular intervals ranging from 10 to 30 minutes. Another popular public transportation service is the rail service. The first mass rapid transit (MRT) lines were constructed in 1982 and still are being expanded today. Buses and MRTs in Singapore are affordable, with fares ranging from US$0.50 to US$1.40. Payment of fares is a breeze as Singapore uses one card for all bus and rail services, called the EZ-link card. Taxis are another popular mode of transport in Singapore. There are eight companies operating taxi services here, and all of them charge by the meter. Starting fare ranges from US$2 to US$2.30.
Communication and Banking Singapore is a highly wired nation. From mobile phones and the Internet to pay TV and postal services, staying connected is not an issue. It is also easy to open a bank account in Singaporeâ€”just bring a form of identification such as a passport or employment pass, and a bank account can be created on the spot. There are both local and foreign banks operating in Singapore, and
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many of them have branches and automated teller machines (ATMs) around the island.
Languages English is the main working language in Singapore. The literacy rate among Singaporeans aged 15 and older is 96.3 percent. English is the first language taught in schools and many Singaporeans speak English well. In addition, students study their mother tongue at school to ensure that they maintain their cultural heritage, usually Chinese, Malay, or Tamil. Most Singaporeans are, therefore, bilingual, if not multilingual. However, foreigners who come to Singapore for the first time may find that the locals also speak â€œSinglish,â€? or Singaporean English arising from
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the preference of Singaporeans to use fewer words to express themselves to save time. Singlish also contains a smattering of words from Chinese dialects and the Malay language, a true indication of the nationâ€™s multiracial roots.
Working and Living in Singapore Singapore is an exciting place for global talent to position themselves to take advantage of the growing opportunities in Asia. It is an affordable international career destination for those seeking an exciting new phase in their lives. Siew Kiang Ng is the executive director of Contact Singapore, a global alliance of the Singapore Economic Development Board and the Ministry of Manpower. She can be reached at +65 6508 3508 or e-mail firstname.lastname@example.org.
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Group Moves An Analysis of Key Considerations BY ALLIE WILLIAMSON, CRP
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Ideally, organizations engaged in the mass movement of human capital work toward the goals of standardization, consistency, and efficiency. A group move has its advantages and disadvantages in that it, in theory, should cut down on the amount of manpower hours by condensing functions, leveraging service volume, and containing costs. Williamson writes that this is true only if the process is managed in a way that no one person perceives his or her services to be any different than what normally would be provided in an individual one-on-one move, and offers a detailed look at the group move process.
dministration of a group move is best used when an organization needs more than one person deployed and can leverage volume services to assist a group all at once. However, a group, by definition is; “a number of individuals or things considered together because of similarities,” and, in relocations, likeness in people is atypical.
So, What Really Is a Group Move? A “group move” is nothing more than the term itself, as each individual is undeniably handled in their own manner, yet the perception is that they are part of the larger mass that is moving at the same time for the same purpose. Aside from the personal aspect discussed in this article, the goal is to ensure that standardization, consistency, and the efficiency of combining resources outweighs the negative perception of a “mass” situation. A group move, like anything else, has its advantages and disadvantages in that it, in theory, should cut down on the amount of manpower hours by condensing functions, leveraging service volume, as well as contain costs. This is true only if the process is managed where no one person of the group feels slighted of what normally would be provided in an individual one-on-one move, as there is definite-
ly potential for loss of individual and specific attention. Aggregation does not require giving one area of concern precedence over another, but watch what happens if you do not properly plan for a group move and you will end up confusing aggregation with aggravation: an act or circumstance that intensifies or makes worse.
The Corporation and the Relocation Company–Working Together Will the transferees all be housed in one office location or numerous external client locations? Whether the group is destined for one specific office or numerous locations, it is good to identify key neighborhoods within an acceptable commute and prepare the destination services partners to start their groundwork as early as possible. One important foundation is to create “regional clusters.” Forming regional clusters helps the transferees identify early with a handful of neighborhoods, and helps the destination people keep to a regimented effective routine and offer substantial information to the transferees on a focused number of areas rather then a diluted amount of information on too many areas. For example, when a transferee is relocated to Manhattan, they have an abundant and overwhelming choice of three states, numerous kinds of mass transit, and an eclectic collection of rural to urban styles. After the
transferee completes his or her needsanalysis profile with a series of detailed questions, each person would be given a cluster that appeals to their commute preference, personal needs, and budget. A suburban cluster might include a maximum of two suburban towns along the coast in New York and Connecticut because the employee wishes to keep a boat on the water, commute by train no more than 60 minutes, and be close to LaGuardia Airport. An urban cluster might include two citified areas such as Riverdale in the Bronx and the Upper West Side of Manhattan because the spouse will be participating in a graduate program at Columbia University. If the first “cluster” is not optimum, a second “cluster” would be recommended to further expand within their needs. What are the salary grades, levels, and do any positions differ greatly? Conduct your due diligence on corporate culture and policy. Determine if one policy will fit the group or if the client will ask you to manage a number of tiered policies at one time. Examine your audience and anticipate who might be entitled to more or less up-front and deal with it from inception. The policy must be clear on those who are renters versus homeowners. If the move is to a lower-cost area, is there an entitlement for renters to get closing costs paid and become a homeowner? This MOBILITY/AUGUST 2010 75
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is a great way to root employees in the new destination and get excited about the move. Is there any internal resistance to know beforehand? Is there any one employee who might spoil the experience, and how can you help overcome this with a buddy system, team building, or outside counseling? As a relocation company, every overall detail needs to be anticipated for the whole group, a never-ending process. Benchmark anticipated questions by building a database of answers in a central staff area for swift and accurate answers. • Which states allow driver’s tests to be taken in a rental car? • Can people insure their car without a local driver’s license? • What are the local utility companies and what is required?
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• Can spouses get a social security number if coming from overseas, on what visa? • How long is the train station parking wait list in the clustered neighborhoods? • Which rental properties allow pets?
The Transferee We know not to assume that all people will have the same exact situation even if they are moving from point A to B. Aside from family size, there are personal budget restrictions, religious and spiritual needs, and variables important to one person and not another. What functions can you team together for consistency and what should remain separate?
Area orientation easily can be done in a group format with the help of a destination team. The earlier the better, pre-acceptance of the position, and formatted in clusters, if possible. Homefinding is not recommended in group format unless you have their permission. For some people, they would overextend themselves to try and “keep up with the Jones’,” others would want a small house versus a large condominium. Some might need to be within walking distance to a house of worship, others close to an elementary school. Temporary housing works great when you can leverage a large bulk of units in one building and negotiate amenities such as breakfast or Internet access. However, beware that complaints will arise if one employee is overlooking Michigan
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Avenue from the second floor versus their colleague looking over Lake Michigan from the 30th. Arrival and settlement services should match as closely as possible to the answers in the initial profiles. The transferee should be willing to give their relocation coordinator as much information as possible to ensure success and it is our job to encourage them to do so. • Do they need baby (car) seats if they get a chauffer service at airport on arrival? • Are there home-schooled children, which is ever more popular these days? • Is their credit good enough for a new mortgage? • Does the spouse need job assistance and what is authorized in way of cost?
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It also is the job of the relocation management company to assist employees in understanding how they affect the success of the group and company and can add or detract from the overall experience. Each person should act as a support system for the next and maintain relationships with each other.
The Destination Partners Can your partners offer consistent and efficient service across the board when they are working at an advanced pace? “More assistance and less resistance” is a motto that should be adapted in all aspects of business but especially in a group move. Vendors need to understand that they are part of a larger effect—this is about the total move and not their book of business. Each partner
should have access to live reporting at all times of the day so the person in charge can, in turn, report to the client with live information. Group moves are an immense amount of work for all parties involved. If suppliers are dedicated, transferees are informed, relocation management companies are prepared, and HR groups are supportive, it becomes a recipe for success. Besides the obvious factor of deploying talent, a group move ultimately should be used to build strong employee focus and get all employees excited to share the same goal together at their new destination. Allie Williamson, CRP, is president of OneWorld Relocation Services, Naples, FL, and a member of the MOBILITY Editorial Advisory Committee. She can be reached at +1 917 847 4818 or e-mail email@example.com.
International Relocation Services Special Advertising Section
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International Assignments Slow? Or Steady… A recent survey holds some surprising results for international long term assignments.
nternational assignments are a costly investment for both company and assignee. Concerns when accepting an international long term assignment include potential issues facing a spouse and children, and sometimes even extended family. For these and other reasons, many companies offer comprehensive assignment benefits packages designed to ease the transition to a new host location. Companies providing these benefits become deeply invested in the success of an assignment. In the still recovering global economy, many companies are experiencing reduced profitability. This downturn affects company-directed cost savings initiatives, including those associated with relocation. At AIReS, we’ve observed both increases and reductions in relocation volume with our clients and prospects. Recently, AIReS’ Consulting Services conducted the first in a series of surveys to assess these trends and benchmark industry Best Practices. This Long Term Assignment Policy survey pulled from diverse companies, some of which include those in the manufacturing, health services, and telecommunications industries. The first surprising result from this survey is that long term relocations in general, defined as lasting one year or more, either rose or stayed consistent throughout 2009. While some companies did report a reduction in volume, approximately half of those surveyed indicated that activity was consistent with the previous year, while one quarter reported a rise in volume. The majority of survey respondents made changes to their assignment policies over the
past two years, a common response to the current economic climate. High cost benefits, such as housing, goods and services, and children’s education are areas that clients have modified, and are being watched for trends geared towards finding fair and equitable opportunities for reducing costs over time. However, with an increasing need to assure successful relocations, additions or enhancements were also made to some programs, which may indeed add to the service delivery costs, with the expectation that the probability of assignment success will be positively affected. The top reasons noted for policy modification included further alignment with industry Best Practices, reducing overall costs, and increasing assignee satisfaction. At AIReS, we understand the importance a successful relocation means to getting your assignee productive in their new position quickly. A focus on the family is a key differentiator for us when approaching long term assignments, a truly unique advantage when partnering with AIReS.
AIRes 6 Penn Center West, Suite 200 Pittsburgh, PA 15276 Tel: 412-788-0461 • Fax: 412-788-0245 www.aires.com
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Are you spending too much on your international assignments? AIRINCâ€™s Mary Ellen Myhr explains how to optimize your global mobility program by aligning costs with business needs MOBILITY We are experiencing the worst economic environment in memory, yet international business is still crucial for most companies. How has this environment affected mobility? Are companies cutting costs?
transfers within a region, and switching to a more conservative COLA methodology. Some companies are developing alternative packages that maintain high subsidies for strategic assignments while reducing costs for developmental assignments.
AIRINC Not all companies and economic sectors have been affected in the same way. Companies in heavy manufacturing continue to struggle, while pharmaceutical companies have done well. Additionally, international business is more important to some companies than to others. Thus cost cutting, while common, is not a priority for everyone, and the manner in which costs are trimmed depends on the company and industry.
However, in all cases, it is crucial to review proposed cost cutting measures carefully in light of the business needs driving each assignment. Cutting too deeply or eliminating the wrong types of support can jeopardize business goals if the right talent cannot be recruited to the necessary location, or the assignee and family do not sufficiently adjust after arrival. The focus needs to be on value, not just on cost.
MOBILITY For those companies where cutting costs is a priority, what are the easiest ways to do it? AIRINC Reducing the number of assignees has the greatest and most immediate impact. For existing and future assignments, the quickest way is to reduce allowances that are tied to external market factors, for example, reducing assignee rental guidelines as markets decline or reducing Cost of Living Allowances (COLA) as exchange rates change. It is surprising how many companies miss such opportunities. Some companies are reducing or eliminating subsidies within the framework of existing policies, such as lowering the global housing budget structure, reducing or eliminating incentives, adjusting hardship allowances for
If a company has one type of assignment, few locations and similar business units, a relatively simple policy may be sufficient. If a company has multiple assignment types, many locations, and multiple industries; a complex program and administrative infrastructure may be required. Simple needsâ€”simple delivery. Complex needs â€”complex delivery. Aligning delivery (cost) with needs leads to value.
+1 617 354 2133 USA +32 (0)2 650 0970 Belgium +31 (0)20 489 3854 The Netherlands +852 3711 3206 Hong Kong www.air-inc.com
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Connect to the Knowledge Center Brookfield Global Relocation Services’ Knowledge Center – the Definitive Information Resource for Modern Mobility Professionals
s the industry’s Premier Service® provider and trusted leader of relocation services and strategic consultancy globally, Brookfield Global Relocation Services recognizes that businesses face countless challenges around mobility. Mobility is our only business and our team of experts is recognized among the best in the industry. Others may say they are a premier provider, but Brookfield Global Relocation Services originated Premier Service and it is the experience we create for our customers and the code we live by every day.
Services experts, information on upcoming educational opportunities, benchmark data, archived educational webinar recordings, Pulse Surveys and other consultative and analytical information.
Our online Knowledge Center allows you instant access to our company’s much sought after expertise by providing the highest caliber of research, thought leadership and expert guidance across a spectrum of relocation issues. We have designed the Knowledge Center to support global mobility professionals worldwide with cutting edge tools that empower them to effectively manage and maintain their mobility programs.
Brookfield Global Relocation Services is dedicated to ongoing information gathering across our organization and industry and is wholly committed to share the knowledge and best practices gained with clients and industry peers through this expansive online collection of industry relevant articles and award winning research. Plug in and make the Knowledge Center your definitive source for relocation information.
Brookfield Global Relocation Services understands that in order to truly deliver Premier Service® in every aspect of our business, it is necessary to investigate and understand the nuances of the industry overall. A click of a mouse offers Knowledge Center users access to a wealth of industry intelligence. Readers will find the latest mobility research including the Global Relocation Trends Survey and Spotlight reports, long considered one of the most reliable sources of relocation data and trends and recognized among the Top 5 Human Resource Surveys worldwide by Expatica HR in 2009 and 2010. Additional resources include Strategic Advisor white papers authored by leading Brookfield Global Relocation
Visit the Knowledge Center at www.brookfieldgrs.com today.
The Knowledge Center also features actual case examples illustrating how Brookfield Global Relocation Services has worked with our clients to help them achieve tangible results and realize genuine benefits for their program and achieve their cost efficiency goals.
Brookfield Global Relocation Services 900 South Frontage Road #200 Tel: 630.972.2250 • Fax: 630.972.2287 www.brookfieldgrs.com
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A World of Mobility Knowledge Is Just One Click Away In our Knowledge Center industry professionals can research trends, topics and data though our many publications such as:
At Brookfield Global Relocation Services we recognize that today businesses face countless issues. Our research offers thought leadership and analysis across a spectrum of relocation issues and challenges faced by global mobility professionals worldwide. And we provided this wealth of industry knowledge, research and expertise in one easily accessible place – The Brookfield GRS Knowledge Center.
Strategic Advisor Articles Global Relocation Trends Research Educational Webinar Recordings Pulse Surveys Success Stories At Brookfield Global Relocation Services we are dedicated to ongoing information gathering across our organization and have wholly committed to share the knowledge we gain with our clients and industry peers. So please feel free to visit the Knowledge Center at www.brookfieldgrs.com
The Leader in sharing industry trends research and knowledge
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Africa: A Challenging New Frontier
ith the sound of the vuvuzelas still ringing in their ears, soccer fans have packed up and gone home. However, the international business community remains firmly focused on the opportunities and challenges that exist in South Africa and the broader continent.
South Africa office aims to help its clients in the region navigate.
As the world slowly emerges from the recent recession, many businesses are looking at opportunities in new markets. An increase in interest in Africa led to the decision by Fragomen to open our own office in South Africa last year.
For example in Kenya, the groundwork has been done for an effective immigration system, but little action regarding changes to the law to introduce bridging provisions between valid applications has occurred. This would significantly assist with unreasonably long processing times and workforce planning issues. Currently, employers often face the need to bring employees in for short term engagements, only to send them home in order to renew their work permits.
We are seeing a rapid increase not only in the movement of people into Africa, but a widening of the industry base showing interest. Previously it was almost exclusively the resources sector that drove interest in the region, but as the economic activity has increased, so has the need for broader infrastructure investment, resulting in opportunities in telecommunications, information technology, finance, and consulting.
Botswana, another increasingly popular market, has a number of strictly regulated immigration provisions regarding local advertising and other market labor testing requirements. However, a relatively small pool of locally skilled workers to fill necessary roles puts great pressure on the immigration process, with companies at risk of being non compliant with Botswanaâ€™s immigration laws.
However, the immigration legislative framework within many countries in Africa has not kept pace with the economic expansion. These immigration complications can severely impact the ability of companies to move people quickly into a country, or to service a new contract.
Immigration compliance is important everywhere, but Africa presents unique challenges and even greater risks. Advance planning and professional guidance are key in achieving overall success.
Less sophisticated immigration systems, an absence of a clear legislative framework, widely divergent processing times, and non compliance with the provisions of the Foreign Corrupt Practices Act (FCPA) are challenges Fragomenâ€™s
To reach immigration professionals in Johannesburg, or one of our 34 other offices, please visit www.fragomen.com.
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Frasers Hospitality International Gold-Standards
rasers Hospitality Pte Ltd, the hospitality arm of Fraser & Neave Limited, stays true to its vision of being the leading extended stay hospitality brand globally. The company has, since the inception of its two flagship Singapore properties in 1998, established quality and industry-recognized brand equity with four branded lifestyle offerings—Fraser Suites, Fraser Place, Fraser Residence and Fraser Resorts. Launched in 2010, Modena—the second Frasers Hospitality brand—its boutique hotel residence with a unique attitude and style. In addition to great locations in gateway and emerging cities, guests enjoy Internet access and Clique Corners to surf or work in. As well as Soak Suites and Nintendo Wii-equipped Laundromats, there is a rain shower in each residence: perfect for road warriors. Young, refreshing, social and fun, Modena redefines serviced residences. Frasers’ renowned reputation for outstanding management of premier properties stems from its focus on continuous product and service development to meet the unique needs of its corporate clients and residents both locally and globally. Frasers’ dedicated quest for excellence also saw the company garnering numerous awards and accolades, testimony to the strength of its philosophy of achieving outstanding customer satisfaction through innovative lifestyle offerings and a customercentric service culture. Frasers Hospitality Pte Ltd currently manages 35 properties—a total of 5,000 individual residences—in 21 cities worldwide. This year, the company will open another 10 properties, eight under the Fraser brand and two under the new Modena brand. In total, the company will
Fraser Suites Shanghai
Fraser Suites Kensington, London
Fraser Suites Seef, Bahrain
make its debut in 10 new major cities—Budapest (Hungary), Doha (Qatar), Dubai (United Arab Emirates), Kuala Lumpur (Malaysia), New Delhi (India), Osaka (Japan), Bahrain (Middle East), Chengdu (China) Suzhou (China) and Tianjin (China). With another 6,000 residences already on the drawing board, the company is on course to manage more than 10,600 individual residences by the end of 2012.
Frasers Hospitality Pte Ltd 491B River Valley Road #03-04 Valley Point Singapore 248373 Global Sales: +65 6415 0326 Fax: +65 6275 1478 www.frasershospitality.com
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Plus Relocation Services, A Legacy of Delight Clients can rest easier knowing that PLUS will help them make the best informed decisions.
president, Susan Schneider to the Worldwide ERC® organization. The PLUS Experience...it all adds up to a delightful “right fit” for those who have the pleasure of working together with them.
The answers to these questions lie in their two-word Mission Statement: “Deliver Delight”. Everything at PLUS revolves around this important daily purpose. Their dynamic Vision Statement sets it up, and it is lived out continually with their six unique company Values.
Our Vision: PLUS is the world’s best relocation company, with the best employees, who care and want to make a difference, who believe in the power of team, who are fulfilled and have fun each day, by providing the highest quality, customized service available–anywhere. Customers, vendors, and employees have been transformed, from business associates to loyal partners, because of our passion to...
he “PLUS Experience” has been the focus of several industry discussions and articles. People wonder “…what is it about this global mobility company that makes them resonate so well with their clients and partners? How do they exceed expectations so frequently? And how do they go about preparing their exceptional employees for service?”
Some things have changed since Mick and Sandy Lee began their careers in global mobility back in the 1960’s. And yet, their legacy of “Delivering Delight” has never changed. At Plus Relocation, caring about people has always been the real “plus”. Passing this along to employees, clients and partners has caused an unending chain of delightful events. People are more engaging with each other, and dig deeper to help each other out. They even have more fun together. The entire environment ensures that values like “aggressive collaboration” and “radical integrity” occur. Combine this with 40 years of industry expertise and their thirst for making things better. You can start to see why their clients say they can rest easier, knowing that PLUS will help them make the best informed decisions.
Our Mission: Deliver Delight!
Since the legacy of delight has been passed down to the entire extended family of PLUS, the future looks bright for this global company. This includes the substantial contributions of their
PLUS World Headquarters 600 Hwy 169 South, Suite 500 Minneapolis, MN 55426 USA www.plusrelocation.com
Our Values: Radical Integrity Aggressive Collaboration Unwavering Commitment No Excuses Accountability Servant Leadership Outrageous Results
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Santa Fe Celebrates 30 Years! Santa Fe was founded on the 28th of February, 1980, in Hong Kong.
ne of the trademarks of Santa Fe has always been innovation and the desire to be a leader, not a follower. The first Smart Big Move by Santa Fe was being the first international moving company to enter into the Chinese market in 1985. Our slogan at that time was very appropriate; ‘Moving Ahead of the Rest’. We continue to hold the leading market position in China with 15 offices throughout the country. In 2000, Santa Fe acquired Global Silverhawk’s Asian operations which extended our market coverage from Hong Kong, Thailand and China, transforming Santa Fe into a far greater regional player and into Japan, Singapore, Malaysia, Indonesia, and the Philippines.
Our journey to this point has been wonderful, and our people, many 30 year veterans, are the ones who have transformed Santa Fe into the company it is today. We are all honored and proud to be part of the Santa Fe team and we will strive to continue our endless effort to always go the extra mile for our customers. All of us at Santa Fe would like to say thank you for your support over the years which has helped us come to the stage where we are today. You can rest assured that we will do our best to continue our journey to be remain relevant to your future needs. Please contact us for more information.
At Santa Fe, the world never stands still and being customer driven, we continued our geographic expansion into South Korea, Taiwan and Vietnam in 2007. In 2008, we acquired leading relocation and moving companies with 7 offices in India. In 2009, we opened in Dubai, which will serve as the platform for further expansion in the Middle East. To support the needs of our customers, Santa Fe have developed multiple quality systems, which include; ISO 9001, ISO 14001, FAIMISO and ISO 27001 certifications and the UN Global Compact program focusing on the Planet, People and Profit. We believe our quality systems set us aside from our competition and ensure consistent service delivery throughout the Santa Fe Network.
Santa Fe Relocation Services 18/F C.C. Wu Building, 302-8 Hennessy Road Wanchai, Hong Kong Tel: 852-2574-6204 Email: firstname.lastname@example.org www.santaferelo.com
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Air Animal: Relationships Matter
he â€œhuman-animal bond,â€? the treasured and valued relationship between people and their pets, is special and unique. As you and your transferees contemplate the move of the family pet by a third-party pet moving service, you want everyone involved in the process to have the best interests of those pets at heart, whether they be dogs or cats, horses, birds, gerbils, hamsters, guinea pigs, etc. With 33 years of experience in the business of reuniting transferees and their beloved pets at their new homes around the country and the globe, Air Animal is committed to insuring the safety and welfare of the relocating family pet. Our pet move specialists (pet owners themselves)
understand the special relationships that exist between people and their pets, and are expert at managing smooth, seamless moves, both domestically and worldwide. At Air Animal, our goal is to provide the very best care for relocating pets, insuring a safe and comfortable transfer, professional handling at each point along the way, and peace of mind for those waiting anxiously at the other end of the relocation. Air Animal Pet Movers, the Tampa, Florida based pet moving service, is family-owned and operated since 1977, and is an IATA air cargo agency.
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Global LT for Worldwide Destination Services
lobal LT’s Destination Services ease the transition of moving to a new country for expatriates and their families, and lift the burden from corporate HR. We make the relocation process a positive experience by customizing our services, based on the needs of each family member. Additionally, our caring relocation staff is multilingual (all employees speak English), allowing us to assist families in their native languages. Several features distinguish us from others. We provide: • A single point of contact regardless of where services are delivered • Global Delivery – from popular destinations to developing countries
• A diverse, comprehensive services’ portfolio, comprising language training, cultural training, and document translation Our destination services can be packaged or purchased separately. Services include: • Community orientation • Home selection • School enrollment • Utility set up • Repatriation • Other services as needed We look forward to serving you . . . wherever you need us! www.Global-LT.com/ERC | 888.645.5881 ext. 22
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Global Relocation Consultants lobal Relocation Consultants (GRC) is an Independent International organization providing relocation services throughout the Middle East.
Centrally located at the heart of the Middle East in Cairo, Egypt, GRC provides a comprehensive Corporate Relocation and immigration service that covers different standardized modular programs or custom programs that will suit any corporate requirement. We assist in locating homes, and provide settling in services and cross cultural training. GRC has representatives in Algeria, Bahrain, Cyprus, Egypt, Iran, Jordan, Kuwait, Lebanon, Libya, Morocco, Oman, Qatar, Saudi Arabia, Syria,
Tunisia, Turkey, UAE and Yemen. Our clients are always accompanied by one of our experienced local staff ensuring the best service possible. The Middle East is definitely a unique area, but that does not have to make it alien or threatening. Our staff are highly qualified, with years of experience and have an excellent knowledge and understanding of the region as well as the needs of the expatriate and their families. Local experience allows us to provide a more realistic assessment of the Middle East. The guide book that GRC hands out to its clients has been written by both Egyptians and experienced multinationals.
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Safeguarding Personal Information... A Commitment from our World
n a world of uncertainty about who sees what and who has a right to handle sensitive documents and information, the UniGroup UTS global network is committed to protecting your company and employee information. Our global service level agreement ensures that only those with a “need to know” have access to sensitive visa and passport information. And, as the significance of compliance continues to rise in our daily affairs, our service level agreement and strong code of conduct give you peace of mind throughout the world. Our single point of accountability, world-class infrastructure and self-help web portal provide
you the tools to fulfill your important obligations in our evolving one-world economy.
UniGroup Worldwide UTS One Worldwide Drive St. Louis, MO 63026 Tel: (800) 374 9625 • Fax: (636) 305 2190 www.unigroupworldwide.com
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Air Animal Pet Movers......................................................................................................................................................94 AIReS..........................................................................................................................................................................80, 81 AIRINC........................................................................................................................................................................82, 83 Altair Global Relocation............................................................................................................................inside back cover Appraisal Institute............................................................................................................................................................19 Brookfield Global Relocation Services........................................................................................................................84, 85 Cosmopolitan Canine Carriers, Inc....................................................................................................................................25 EMDOC ............................................................................................................................................................................27 FIDI...................................................................................................................................................................................73 Fragomen, Del Rey, Bernsen & Loewy, LLP...............................................................................................................6, 86, 87 Frasers Hospitality Pte Ltd....................................................................................................................................71, 88, 89 Global L.T. LTD..................................................................................................................................................................95 Global Mobility Solutions.................................................................................................................................................49 Global Relocation Consultants, Middle East.....................................................................................................................96 Graebel.......................................................................................................................................................................20, 21 Habitat Corporate Suites Network..................................................................................................................................102 Intermark Relocation..........................................................................................................................................................4 North American Van Lines, Inc............................................................................................................................................3 Ocean Global Relocation Solutions...................................................................................................................................26 PC Housing...............................................................................................................................................inside front cover Plus Relocation Service, Inc.........................................................................................................................................90, 91 Primacy Relocation, LLC...................................................................................................................................................11 Pro-Link GLOBAL Visa & Immigration Services...................................................................................................................1 Prudential Real Estate and Relocation Services..................................................................................................................9 Quest Serviced Apartments...............................................................................................................................................61 Reindeer Auto Relocation...........................................................................................................................................42, 43 Santa Fe Relocation Services.......................................................................................................................................92, 93 SIRVA Relocation.................................................................................................................................................back cover Stewart Relocation Services.........................................................................................................Trendspotting sponsor 15 Suites at Silver Towers....................................................................................................................................................102 TheMIGroup.....................................................................................................................................................................17 UniGroup Worldwide........................................................................................................................................................97 Wells Fargo Home Mortgage............................................................................................................................................14 WHR Group......................................................................................................................................................................13 WorldCare Pet Transport...................................................................................................................................................38 Worldwide ERC®.....................................................................29, 33, 34, 35, 44, 45, 54, 59, 60, 65, 68, 72, 76, 77, 78, 102 98 MOBILITY/AUGUST 2010
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Regional Market Summary: Manhattan and New York City Metropolitan Areas
he New York City metro area includes the five boroughs— Manhattan, Brooklyn, Queens, the Bronx, and Staten Island—as well as Long Island, Westchester County, NY, Fairfield County, CT, and Northern New Jersey. Manhattan contains a large portion of the economic engine that drives the region, specifically the financial services sector, accounting for approximately 5 percent of the employment and 25 percent of wages. The region was one of the last areas in the United States to experience a housing downturn, largely because of the financial services sector. Record or near-record bonus compensation, accounting for 40 to 50 percent of individual compensation, remained at or near record levels for the last decade. The housing market peaked in early 2008 and experienced a sharp correction in sales and prices immediately following the September 15, 2008, bankruptcy of Lehman Brothers, one of the five primary investment banks. Sales activity dropped 75 percent immediately as consumer and lenders pulled back and housing prices across the region fell 20 to 40 percent in the following months. Layoffs were forecast to approach 250,000 for the region and more than 20,000 estimated condo units, or “shadow inventory,” were built during the housing boom stall. New York City Department of Buildings has counted more than 500 development projects that stalled during the following year. Many of these developments may end up repurposed to rentals during the next several years in response to the limited availability of financing for condo new construction units to individual buyers. A disproportionate amount of housing in New York City that is purchased or refinanced relies on jumbo financing. Expansion of the conforming loan rate limit from $417,000 to $729,750 by Fannie Mae and Freddie Mac was helpful in providing mort-
Unemployment Months’ Supply Annualized Sales Volume Annualized Avg. Sale Price Average DOM
ONE YEAR AGO
7.9 8.9 6,128 $1,372,267 105
8.4 18.4 11,024 $1,502,175 162
-5.95% -51.63% 44.41% -8.65% -35.19%
gage liquidity. However the average sales price in Manhattan is roughly double the new conforming mortgage limit reflecting the financing difficulties still facing the housing market in New York City. However, the foreclosure phenomenon that has hit many other housing markets has not been comparable in size in the New York City metro areas. One of the largest forms of homeownership in the metro area are co-ops, and co-op boards were much better at vetting the financial qualifications of buyers than lending institutions were during the housing boom. Historically, co-ops have experienced much lower default rates than single-family and condominium properties. In Manhattan, co-ops represent 50 percent of the owned housing stock and there was limited investor speculation. Sales prices of Manhattan single-family residences averaged $5,000,000 in 2009 and only 2 percent of the total transactions. Regional unemployment has begun to decline and actual layoffs have been half the levels projected. New York City faces significant fiscal shortfalls and austerity has entered the mindset of participants in the housing market. The mortgage “net” cast to borrowers remains smaller than it had been in recent years serving to temper the pace of recovery of the regional housing market. High unemployment levels, “shadow inventory” and tight credit are challenges that continue to face the market, but general market conditions are improved significantly over the same period a year ago. The num-
MARKET AT A GLANCE Economic Climate
Market Direction Market Mood
ber of sales in the first half of 2010 are twice the levels seen in the same period a year prior and remain at levels consistent with average quarterly levels of the past decade. Housing prices have begun to stabilize in recent quarters as sales activity has returned to more “normal” levels. Listing inventory for re-sale housing stock is at normal levels relative to the prior decade average. “Shadow inventory” remains unsolved as lenders continue to practice “pretend and extend” by providing credit to developers to keep the distressed assets off their balance sheets to prevent weakening their capitalization positions and impairing their ability to lend. This housing stock may take five or more years to be absorbed. Visit www.WorldwideERC.org/ Resources/MOBILITYarticles/Pages/ 0810-RAC-Report.aspx to view a chart illustrating median sales price for the New York City metro area between 2005 and 2010. Jonathan J. Miller is president and CEO of Miller Samuel Inc., New York, NY. He can be reached at +1 212 768 8100 ext. 101 or e-mail email@example.com. MOBILITY/AUGUST 2010 99
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Tax and Legal Update
Beware the Fine Print—Short Sale Clawback Provisions s market participants and regulators implement risk controls and reforms to address the current real estate climate, the relocation closing process has become an exercise in adaptability. Lenders are reexamining their underwriting practices and looking for ways to minimize their exposure to the risks associated with distressed property, such as title defects and fraud, while federal agencies seek to protect consumers going forward and reintroduce liquidity to the market. These trends present unique challenges to the successful transfer of relocation property, which already is misunderstood by the general real estate community. This series of articles (the first, “Revisiting the FHA Anti-flipping Rule,” was featured in the May 2010 issue of MOBILITY) examines three developments that relocation professionals should be aware of to ensure a successful real estate closing. Working out a short sale of transferee property always requires vast stores of patience, finesse, and industry expertise. Yet once the lender sends the agreement and/or closing instructions, it is more important than ever to be on the lookout for potential pitfalls. In response to a very real risk of fraud in the short sale market, lenders are including various clauses in their documentation that purport to allow them to unwind the short sale approval (i.e., reinstate the lien) under certain circumstances. While the language varies by lender, there generally are clauses addressing both fraud and flipping. A few of the more prevalent include: • “If the property was acquired by any means of fraud, Lender reserves the right to pursue any and all actions available to it to offset its losses. If it is determined that Seller(s) and/or Buyer(s) participated in any way to the fraud, this short sale will be void, and the Note and Security Instrument will remain in full force and effect.” • “Lender requires full disclosure, which includes all details of the transaction on both the Seller and Buyer side of the HUD-1. If Lender finds full disclosure was not made at the time of the approval, the approval becomes null and void.” • “There are to be no transfers of property within 30 days of the closing of this transaction.” There are two major issues with these clauses. First, few underwriters would be willing to insure title when the sale is subject to any of these provisions, as there is no
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way for them to know whether full disclosure was made, whether the property will be resold in the near term, and the like. The possibility of the lien being reinstated and property foreclosed on typically will lead to a policy exception or inability to insure title. At best, the title policy would include an exception to any title defects relating to one of these clauses, and may require further assurances such as affidavits from the relocation management company (RMC). Second, and of particular importance to AV and buyer value option (BVO) homesale programs, a RMC’s ability to resell the property to a potential purchaser may be limited by a clause that prohibits subsequent transfers for a period of time (e.g., 30 days, close of escrow, and so forth). If any of these clawback provisions are present, it typically will be necessary to explain the relocation process and have the lender remove the language or seek written assurances from an authorized person at the lender that it will not be enforced under the circumstances presented. In discussions, it is important to remember that when a lender sees two sales in close proximity, they assume that there is a profit being made on the resale, and in the context of a short sale, they often are correct to conclude that it is coming out of their bottom line. It then becomes vital that they understand there is no such motive in a managed relocation—the lender is receiving fair market value for the property, not a fraudulently depressed value presented as fair market in order to pocket the spread on resale. The RMC’s interests actually are aligned with the lender’s—the RMC’s goal is to facilitate the transfer of the transferee’s distressed property, and the lender wants to avoid the additional expense and burden of foreclosure proceedings and the REO market. As with many of the recent risk controls being implemented industry-wide, opening a dialogue with the lender as soon as possible to explain the relocation process is the best way to ensure a transaction will not be unwittingly compromised. Eric Arnold is counsel for Stewart Relocation Services, Houston, TX. He can be reached at +1 713 561 7974 or e-mail firstname.lastname@example.org. Piper Sheffield, CRP, is senior vice president, director, for Stewart Relocation Services, Houston, TX. She can be reached at +1 713 625 8194 or e-mail email@example.com.
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Before You Leap
Intelligence for Assignees in Australia
successful international assignment requires forethought and advanced planning. From locating suitable housing to tax and immigration administration, preparing the assignee and his or her family involves appropriate planning and a considerable investment of time and resources. For assignments where Australia is the destination, Nick Woodhams, GMS, offers the following cultural nuances:
Banking and Finance pening a bank account in Australia is easy, and can be done prior to arrival. Account holders can deposit funds but cannot withdraw before first personally appearing at a branch bank. With regard to credit cards, the application can be processed prior to arrival, however, the card cannot be used before first personally appearing at a branch bank.
Automobiles and Driving What to Bring lectrical current (240 volts, AC, 50 cycles) is incompatible with North America, hence most electrical appliances are unsuitable for shipping to Australia. Quarantine rules are strict. For example, untreated timber, raw products, and many food products are not permitted and will be confiscated at the airport or arrival port (if in the shipment).
Pets Australia has very strict quarantine rules (there are no cases of rabies in Australia). Dogs and cats need a course of inoculations, which can be commenced in the home country. Dogs and cats spend a minimum of one month in residential quarantine away from the family on arrival. Most apartments and townhouses have strata regulations, which prohibit the keeping of dogs and cats on the premises. In freestanding homes, permission must be given by the landlord, and it is common for landlords to stipulate a “no pet” policy.
nternational assignees can drive provided they have a current driver’s license. Assignees can use home-country driver’s licenses in some states (e.g., New South Wales), however, some states require a local license. Motor vehicles are expensive relative to the cost of automobiles in North America and Europe. Fuel is cheaper than Europe (the cost is volatile; in early 2010 it is approximately A$1.25 per liter, which equates to US$1.13, €0.77, and £0.75.) Private long-term car rentals (operating lease) are unusual. Most motor vehicles are acquired via three- to four-year financing. Rule of the road—keep an eye out for kangaroos after dark in rural areas.
Health and Medical Facilities ssignees must have health insurance to obtain a residence visa (which also acts as a work permit). Doctors are known as GPs (general practitioners) and they are the starting point, except for emergencies. GPs make referrals to specialists (e.g., pediatricians) as required.
Nick Woodhams, GMS, is director of Reloc8 Asia-Pacific—Australia and a member of the MOBILITY Global Editorial Advisory Committee. He can be reached at +61 2 9955 3300 or e-mail Australia@reloc8asia.com. MOBILITY/AUGUST 2010 101
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Angola’s Luanda Beats Tokyo as Priciest Expat City Reuters (06/29/10) Casciato, Paul The new Mercer Worldwide Cost of Living Survey puts Angola’s capital city of Luanda at the top of the list as most expensive city for expatriates, knocking Tokyo out of the top spot and into second place. Several other developing African and Asian cities rounded out the top of the list, with the survey finding them even more expensive than Western cities like New York or Washington, DC. Violence in areas like Chad’s capital Ndjamena, which takes third place on the list, make secure accommodation very expensive, according to Mercer researchers. Rankings are based on the cost of more than 200 items, including housing, transport, food, clothing, household goods, and entertainment. Libreville in Gabon took seventh place while seven Chinese cities also appeared on the list. Among Asian cities Osaka took sixth place, and Hong Kong tied with Zurich for eighth, and in Europe Oslo took eleventh place while Milan was 15 and London and Paris tied for 17. New York was the most expensive U.S. city, but it was ranked only at 27, followed by Los Angeles at 55 and Washington D.C. at 111. (http://af.reuters.com/article/ commoditiesNews/idAFSGE65S0D420100629) Russia Passes Legislation to Attract ‘Highly Qualified Professionals’ From Abroad Telegraph.co.uk (06/25/10) Hyslop, Leah Russia has passed legislation designed to streamline the morass of regulations governing the hiring of foreign professionals in the country, and make it less difficult for Russian businesses to hire proficient expatriates. The Federal Law on the Legal Status of Foreign Citizens, which will come into effect on July 1, inserts the term “high qualified foreign professional,” which applies to foreign citizens with key skills in a specific discipline and whose salary in Russia will be a minimum of 43,000 pounds annually. Previous rules made work permits for foreign employees valid for up to 12 months and could take up to a year to obtain; under the new legislation, companies will be able to obtain work permits for foreign professionals for up to three years, which can be renewed on a three-year basis if a contract is agreed upon by both parties. “Russia has had many problems with illegal immigration in the
past, particularly from countries belonging to the former Soviet Union, and strict legislation was brought in to restrict immigration in the beginning of this decade,” notes Olga Chislova with the Moscow office of law firm Freshfields Bruckhaus Deringer’s. “However, these rules failed to differentiate between migrant untrained workers from former Soviet states, and qualified professionals from overseas. It was the companies who wanted to go about hiring skilled foreign employees in a transparent way that suffered, because it could take up to a year before a foreign employee had all their necessary permissions.” Baker and McKenzie legal counsel Evgeny Reyzman speculates that the Russian economy will benefit from the new legislation. He also points out that “a working permit will automatically qualify skilled foreign workers for residency permits, which did not happen before.” (http://www.telegraph.co.uk/expat/expatnews/7851908/Russia-passes-legislation-toattract-highly-qualified-professionals-fromabroad.html) Chinese Influx Poses Profound Policy Changes Asahi News Service (Japan) (06/22/10) Isogawa, Tomoyoshi Japan is increasingly depending on Chinese workers to fuel its economy as its population ages and birthrates continue to be low, and many Japanese are concerned about the sharp increase in foreign workers. Chinese are flowing in to many sectors, including rural and farming communities, universities, and the IT industry, and soon the number of Chinese in Japan is expected to hit one million. Most of the workers are highly skilled, as those in unskilled jobs are only allowed to stay for a limited time. This has made some Japanese uneasy, and even some Chinese themselves are worried about the influx, saying it could turn an anti-foreigner movement into an antiChinese movement. But businesses say they need more talented workers, and competition with other countries is stiff. Many Chinese are choosing Europe or America over Japan, while some skilled Chinese in Japan are looking to return home. (http://www.asahi.com/english/ TKY201006210316.html)
July 7, 2010 This issue is sponsored by:
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GLOBILITY® is an exclusive news service of the Worldwide ERC® offered free of charge for the asking and comes to you twice a month. To subscribe, visit: www.WorldwideERC.org/ Newsroom/GLOBILITY. GLOBILITY® sweeps nearly 7,000 sources including major newspapers, business magazines, web sites, wire services and industry publications to find the most noteworthy news focusing on global workforce mobility issues. The editorial staff reviews over 15,000 stories per day and prepares an executive summary of the most significant articles to be delivered to your e-mail inbox.
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Real Estate Risk Review s I write this piece, the oil has stopped flowing from the Deepwater Horizon well in the Gulf of Mexico. If this is the success we have hoped for the last three months, we now can begin planning for the effect on the Gulf States during and after clean up. The resulting effects on homesale relocation presents several issues. The serious loss in revenue from tourism and the ocean-based industries will increase unemployment. A Wells Fargo economist estimates that 250,000 jobs could be lost in the second half of the year in fishing, tourism, and energy. Increases in unemployment lead to more mortgage delinquency and foreclosures, and more homes on an already bloated market. In addition, fewer buyers will be able to qualify for home purchases. Lenders even may curtail lending on homes in cases where the effect of the oil on the water and shore affects values. High rises with ocean views in the north-central Gulf may be stigmatized. Beach community homes will be similarly affected—what value is inherent in a beach home if the water is full of oil and unpleasant odors, and the shore is tarred? Faced with a homesale for a transferee, how do appraisers adjust for such uncertainty, especially in light of 120-day marketing times? We used mapping technology to analyze relocation move data in the Gulf. Homesales very clearly are clustered and almost always within 20 miles of the coast. Water and sand obviously contribute to home value and appeal in those locations. How will real estate agents list homes to get a fair price with the oil spill overhang? One veteran of relocation asked me, “will anyone buy within 25 miles of the coast until there is a good sense of damage and cleanup?” Surely, clients will incur more temporary living, as well as more property management expenses on homes that will not sell. It might be worthwhile consulting the field service companies about how they are responding, and if they are marshaling extra resources for REO properties. Also, special instructions issued by HUD, Fannie Mae, and Freddie Mac for their properties in the Gulf might be worth a look for homesale and inventory management benchmarking. Of course, the big question now is how long will it take to clean up? What will happen to the health of the ocean? If there is an analog in recent history, we can learn from it—identify the size, duration, geographic impact, economic woes, and effects on real estate that resulted. The most relevant event that relates to the BP oil spill may be the Exxon Valdez in 1989. That spill in Prince William Sound was reported at 11 million gallons of crude from Prudhoe Bay. In Prudhoe Bay, more than
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11,000 square miles of ocean were affected and about 1,300 miles of shoreline were covered with oil. The BP spill may be more than ten times the Exxon Valdez volume. Despite a two-year clean-up effort costing $2 billion, only 10 percent of the oil was recovered. Oil remains in the sandy shoreline and organically deteriorates at about 4 percent per year. Scientists have reported that some shoreline habitats may take up to 30 years to recover. There also was extensive damage to wildlife, recreational fishing and salmon stocks. Although there was damage to tourism, Prince William Sound is remote and sparsely populated. The Gulf is obviously far more densely populated with more ocean traffic. Consult http://gulfseagrant.org/oilspill/database.htm to track clean-up and recovery. Hurricanes either could make it worse by spreading the oil farther, or improve the situation by breaking up the oil near the surface. But also remember that Hurricane Rita’s storm surge carried 20 miles inland. How should we handle policy adjustments, and how to budget? The consensus from my conversations is to create special distress policies for anything from New Orleans to the Florida Keys and within 25 miles of the coastline. It is going to be a long clean up and recovery. We need to stay informed and consult the many resources the oil industry and government will throw at this enormous challenge. Editor’s note: Look for Moore’s column, Real Estate Risk Review, in upcoming issues of MOBILITY. Patrick Moore is president of Hayden Moore Associates, Chagrin Falls, OH. He can be reached at +1 216 338 7081 or e-mail firstname.lastname@example.org.
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Relocate Your Thinking
Published on Aug 2, 2010
Find relocation industry answers here. Join more than 30,000 relocation professionals who read MOBILITY magazine every month. This informati...