Various models of assignments
The guide is for newcomers to global mobility and provides the basics for developing a global assignment policy. In today's global economy, effective global mobility management is critical to innovation and growth. It offers many rewarding career opportunities and supports organisational goals, enabling companies to remain competitive in the global marketplace. However, successfully managing international employee assignments is becoming increasingly complex and costly, as many multinational employers can attest.
Technology and the internet have shortened distances and facilitated trade. However, when developing a new assignment policy, employers must continue to carefully consider geographic and cultural differences in relation to their business needs and objectives. One of the biggest challenges is to develop a consistent and practical compensation approach that is embedded in the assignment policy.
Long-term assignments
Long-term assignments which usually last between one and five years, are often associated with high costs. These assignments may involve the employee's entire family relocating to the host country and require comprehensive support in terms of salary, accommodation and other allowances.
Short-term assignments
Short-term assignments usually last between three and twelve months and often do not include family support. They are more cost-effective and flexible, as they do not require long-term commitments.
Localisation and permanent transfers
In the case of localisation, the employee is permanently transferred to the host country, often with a compensation package that is adapted to local conditions. Permanent transfers mean that the employee has no intention of returning to their home country and works entirely under the conditions of the host country.
Commuters and rotators
Commuters and rotators are employees who regularly travel back and forth between their home country and the host country, often weekly or monthly. These assignments are usually unaccompanied and require a flexible compensation approach.
International remote working
International remote working enables employees to work for the host country from anywhere in the world. This type of mobility has become increasingly important as teleworking has become more widespread.
Important considerations for secondments
Weighing up costs and needs
Whether it is a large multinational company, a non-profit organisation or a small company that is just entering the international business arena, financial and personnel issues are always at the forefront. Employers must carefully weigh the needs of foreign personnel against the costs of filling positions with expatriates, especially in economically uncertain times, as stated in the assignment regulations.
Concerns among employees
Professional and personal considerations not only influence employees' decisions to accept foreign assignments, but also their performance on site. Uncertainty about the new position and future career opportunities often leads to fears that their professional development could suffer during their stay abroad.
Careers of marriage partners
The career of the partners plays an increasing role in the decision of whether a person accepts an international assignment. Difficulties can also arise in the management of investments or real estate in the home country.
The process of a secondment
Selection of delegates
Die Auswahl geeigneter Kandidaten für Auslandseinsätze ist entscheidend. Dies umfasst die Bewertung der technischen Fähigkeiten, kulturellen Anpassungsfähigkeit und der Bereitschaft, im Ausland zu arbeiten.
Deployment planning
Eine sorgfältige Einsatzplanung stellt sicher, dass alle finanziellen, steuerlichen und regulatorischen Aspekte berücksichtigt werden. Dies umfasst auch die Planung der Rückkehrstrategie, noch bevor die Person den Einsatz antritt.
Ongoing deployment management
Ongoing management of the assignment includes monitoring expenses, ensuring compliance with local market conditions and communicating with the assignee in a timely manner to ensure that they understand and accept the company's policies.
Return and post-assignment services
The return strategy and post-deployment services are crucial to ensuring that employees are successfully reintegrated after returning to their home country or after a transfer.
Introduction to remuneration approaches
When companies first start operating internationally, their objectives are often immediate – to get the job done. They tend to send the first available technically qualified person and negotiate packages individually. However, as they gain experience and the need to remain competitive, most companies develop a policy and a more structured approach to remuneration of expatriates.
The balance sheet approach
The balance sheet approach is considered the best way to support broader company policies and business objectives while recognising the unique nature of international assignments through a specially designed programme. This approach helps to balance the cost of living differences between home and host countries so that assignees neither lose nor gain purchasing power.
Alternative payment methods
With the increasing diversity of deployment types and different countries, employers are looking for alternative methods to offer competitive but cost-effective salary packages. This may include hybrid approaches such as "Home Plus" or "Host Plus", which offer additional allowances to address different needs.
Calculation of allowances and premiums in global mobility
Cost of living allowance
The cost-of-living allowance is intended to compensate for the difference in the cost of goods and services between the home and host countries. It does not include housing costs, which are normally covered by a separate housing allowance, an important aspect of the assignment regulations.
Housing allowance
The housing allowance takes into account the different housing costs in the host country. Most companies provide a housing allowance based on the size of the family and the income level of the expatriate.
Quality bonus
The quality allowance, also known as the location allowance, compensates the expatriate for the lower quality of life in the host country. This allowance is calculated as a percentage of the basic salary and varies depending on the conditions in the host country.
Internationale Steuern
Regeln des Heimat- und Gastlandes
Expatriates must comply with the tax laws of both their home and host countries. This includes filing all required tax returns and paying the appropriate taxes.
Tax treatment and equalisation
Tax equalisation ensures that expatriates are not financially worse off than in their home country. This is achieved by withholding a hypothetical income tax based on the salary level of colleagues in the home country.
Responsibilities of employer and employee
Employees are responsible for filing all required tax returns and making the necessary payments. Employers should provide assistance with tax returns and tax compliance.
Current trends in "global mobility"
Segmentation of guidelines
Unternehmen führen zunehmend flexible Global Mobility Programme ein, um den unterschiedlichen persönlichen Situationen der Entsandten gerecht zu werden und ein attraktives Mitarbeiterwertversprechen zu schaffen.
Support for dual careers and families
The support of dual careers and family members plays a decisive role in the decision of individuals to accept international assignments.
Strategic planning and talent alignment
Strategic planning and the alignment of talent are crucial to achieving a timely return on investment and maximising the efficiency of staffing.
Conclusion on the development of the secondment regulations
Global mobility is a complex but essential element for the success of internationally active companies. Through careful planning, appropriate compensation and continuous support, companies can ensure that their international assignments are beneficial to both the company and the employees. With the development of a secondment policy, the right strategy and the right resources, global mobility programmes can contribute to innovation and growth, while at the same time promoting career development and the well-being of employees. lement, with the right strategy and the right resources, global mobility programmes can contribute to innovation and growth, while at the same time promoting career development and the well-being of employees.
FAQ's
Global mobility refers to the international deployment of employees by companies in order to achieve business objectives and promote career development.
The types of global mobility include long-term assignments, short-term assignments, localisation, permanent transfers, commuters, rotators and international remote working.
The appropriate remuneration of expatriates is crucial to ensure that employees are not financially worse off and are motivated to take on international assignments.
The cost-of-living allowance is calculated based on the difference in the cost of goods and services between the home and host countries.
The administration of international taxes involves compliance with the tax regulations of both the home and host countries, as well as minimising the tax burden for expatriates.
Support for expatriates during their assignment includes the provision of housing allowances, assistance with tax returns and the provision of resources to help them adapt to their new living conditions.
AITCHLAB offers comprehensive support for all questions relating to global mobility. Our experienced team helps you to understand the specific challenges and requirements of your company and to develop suitable solutions.
