What is a global mobility program?

A global mobility program is a strategy for facilitating employee relocation worldwide. Its purpose is for companies to utilize their employees best to allow both the company and the worker to grow and develop.
Global mobility programs often deal with different types of employee transfer, such as relocation, international projects, business travel, and short-term, long-term, and permanent movement. Additionally, it typically includes guidelines for immigration, cultural integration, immigration, and financial and logical support.

What are the benefits of employee relocation?

There are several reasons why companies may want to build or implement a global mobility program. A few benefits include:

• Greater access to talent: Offering global mobility means companies can give access to talent within their organization and from other countries.
• Increased competitiveness: Opening up the talent pool means employees can offer a wider range of experience and skills, increasing innovation.
• Improved relationships: Having a partner on the ground abroad can lead to more meaningful relationships with international clients or partners.
• More cultural awareness: With employees working internationally, employees develop an understanding of local markets and cultural norms.
• Career development: International assignments help employees expand their skill sets, leading to career growth.

What are the compliance considerations with global mobility programs?

When companies enter international markets, they must adhere to local compliance regulations. Though each country has its own employment laws, there are a few general considerations for global mobility programs.

Payroll

Managing international payroll can get complex, especially when following various regulations across multiple countries. Companies will likely need to collect and record certain payroll information to remain compliant. This includes:

• Employee earnings
• Reporting requirements
• Business tax rates
• Currency exchange rates
• Social security obligations

Immigration

Employees who relocate to another country must have the correct visas and work permits. Immigration compliance is often time-consuming and multi-faceted, but essential. Violations of immigration laws can lead to audits, penalties, and fines, and more.

Corporate tax

When relocating employees internationally for short- and long-term stints, companies face permanent establishment (PE) risk. PE risk is when a local tax authority in a foreign country has evidence that the company has full-time operations in that country, which can make a business responsible for all corporate taxes. To avoid this risk, consider the following:

• The number of employees working in the location
• The activities they’ll be doing
• How long they’ll be there
• Any long-term business plans in the country

Finance and HR departments can work together to monitor these risks.

What benefits should employers include in a global mobility plan?

A few employee benefits employees can include in a robust global mobility plan include health insurance, relocation reimbursement, vacation and leave policies, and retirement benefits. Employers must consider the cost of living in the new country so that employees can live comfortably without disrupting the company’s budget.