How to Successfully Create an Employee Relocation Package

On average, 12.7 percent of employees are willing to relocate for a job.

If your company is in the process of growing and you need to attract and relocate top talent to a new location, you might have to offer them a relocation package they can’t refuse.

In this article, we will put together a guide of everything you need to know when creating an employee moving package.

What Are Employee Relocation Packages?

As part of their efforts to expand or obtain top talent, companies offer employee relocation packages to help current or new employees cover the costs of moving.

The level of assistance included in these packages varies depending on whether or not the company is relocating new hires, current rank employees, or executives.

New Hires

If a new employee that lives more than 50 miles away gets offered a position with the company, they might qualify for a relocation package.

Current Rank

Current rank employee relocations often entail those who have been with the company for a long time. Relocation packages for these employees need to be a lot more attractive since they already have their life established.

If they’re willing to relocate for the job, the offer also has to be more attractive than what they have now.

High Executives

Executives and high-level employees often only relocate to help expand the company to new territories. They are more likely to relocate when they’re asked to lead a new team.

Types of Employee Relocation

The term relocation might seem so permanent, but the truth is it covers many different types of relocations. For example, some companies might only need their employees to relocate for a short amount of time, while others need it to be permanent.

Short-Term Relocation

If your company only needs the employee to relocate for a few months up to a year, it’s called short-term relocation. With this type of relocation, your employee helps fill a staffing gap and gives support to the team in said location.

With short-term relocation, employees can gain experience without having to uproot their life permanently.

Project-Based Relocation

With this type of relocation, employees know they’re only going to move to another location for the duration of the project.

Some employees might even want to negotiate a deal that only requires them to travel back and forth until the project is completed.

However, some might choose to move to a new location until the project is done.

Team Relocation

Although these are rare, some companies have to move entire teams to a different location. Since these moves tend to put a lot of strain on the company’s budget and HR resources, sometimes the company has each individual and their families responsible to move.

What Should You Include the Relocation Package?

Although the relocation packages you provide from for your employees might vary from industry, location, and job descriptions, there are a few things that are standard of most packages. 

Orientation Trip

As a part of the relocation package, companies sometimes offer an orientation or familiarization trip. Employees oftentimes have the opportunity to visit the place where they’re might relocate.

The trip offers them an opportunity to visit the company’s headquarters, location, and see the office space. During this trip, they also have the opportunity to see the area and explore neighborhoods, restaurant, and other activities available to them.

As part of the orientation trip, employers pay for the airfare, hotel, car rental, local transportation, and maybe some entertainment.

Transportation and Moving Costs

Giving employees a stipend or covering moving costs is standard of all employee relocation package plans. When you offer a moving plan to your employees, you need to include a stipend or cover the relocation of their personal and household items.

Oftentimes, some companies offer to reimburse their employees once they make it to the final destination. Employees will typically submit receipts for travel-related expenses such as car rentals, moving truck rentals, airfare, professional movers, gas, food, and other expenses related to the move.

Depending on the company, some might work with their own moving company to pack and unpack the employee’s household items from door to door.

You can consult this employee relocation cost estimator to determine how much it will cost.

Home Sale or Lease Related Expenses

Included in the relocation package, employers usually help cover the home sale or any rental or lease related expenses.

If the employee owns their home and has to sell it in order to relocate, there will be certain expenses they need to pay such as realtor, broker, or other mortgage fees.

In some rare scenarios, the company might even purchase the home of the employee and sell it later.

However, these relocation packages are often only available for high-tier employees.

When employees have a home lease and have to break it due to the relocation, the employer tends to cover the cost of breaking out of the lease. This also depends on the tier of the employee.

Spousal Support Stipend

If the employee is married, part of the package might include spousal support.

This means the company will typically spend a lot of resources to relocated the spouse as well.

High-tier employees might receive enough support to help their spouse find a job or even re-establish their old business.

Repayment Clause

Of course, it seems risky for employers to spend so much money relocating an employee only to have them leave the company after a few short months.

To protect themselves from this situation, employers have to add a repayment clause as part of their relocation package.

In this clause, the employee has to agree to reimburse the company for all of the moving-related expenses if the quit the job during the specified time frame. As a precaution, most employers require employees to stay in the current position between 12 to 18 months.

Companies who have a history of a high turnover really benefit from these clauses. On the other hand, some companies fear adding a repayment clause will discourage any future employees from relocating.

Employee Moving Package: The Bottom Line

Now that you know what to include in an employee moving package, it’s time to put together one that makes the most sense for your company.

Remember to include travel or moving stipend, home-related expenses, spousal support, and don’t forget to add a repayment clause.