In today's rapidly evolving business landscape, companies are redefining their approach to employee mobility benefits. The traditional methods, which were primarily based on organizational hierarchy or employee level, are gradually giving way to a more purpose-driven matrix approach. This contemporary fit-for-purpose model considers the motivation behind the employee's move, whether it's for talent development or business reasons, and tailors the benefits accordingly.
Revamping Allowances: Scrutiny and Tax Efficiency
Companies are increasingly scrutinizing non-accountable miscellaneous expense allowances and lump sum payments, which have long been a staple of mobility policies. As businesses face mounting pressure to manage costs, they want to ensure that these funds are used effectively and inform future policy changes. One way they're doing this is by prioritizing reimbursement of actual mobility expenses and coverage of services that, depending on location and circumstance, can often be tax-excludable, rather than issuing non-accountable cash lump sums or allowances that must often be treated as taxable income. Managed lump sum payments that require demonstration of use of funds through expense reimbursements are also an excellent way to balance employee flexibility to exercise choice while maintaining program managers’ control and visibility into the use of funds.
Consumer-Driven Choices: Flexibility and Personalization
The trend towards consumer-driven service choices in mobility policies is also gaining momentum. Employees, accustomed to highly customizable product and service choices in their everyday lives, now expect the same level of personalization in their relocation packages. Companies are adapting by offering flexible policy structures, such as core-flex, and providing a range of choices within each benefit category. The empowerment of employees to make benefit choices best suited to their needs and circumstances, a hallmark of these flexible benefit structures, can contribute to a company’s DE&I goals. Non-traditional service options, like house cleaning, flight upgrades, and meal delivery vouchers, are also becoming more commonplace and can serve to differentiate mobility offerings in today’s competitive talent landscape. Benivo’s 2023 Core-Flex Policy Benchmark Survey provides great insights into these trends for companies contemplating a move toward flexible benefit approaches.
Embracing the Future of Employee Mobility
In conclusion, the future of employee mobility is shaping up to be a dynamic and employee-centric landscape. With a matrix approach to benefit packages, increased scrutiny on non-accountable allowances, and a focus on consumer-driven service choices, companies are redefining what it means to support their employees during a move. By embracing these changes, businesses can not only manage costs more effectively, but also attract and retain top talent in an increasingly competitive market.
Contact Benivo’s Client Advisory team today to request a free consultation. Our experienced advisors stand ready to offer insights into effective strategies for optimizing the performance of your mobility program.