Being asked to relocate for a job can be a mixed blessing. On the one hand, if you're considering the relocation at all, it may be because you're being offered a promotion with your current company or a job that you really want with a new company, so being asked to move to take the position will be a step up. On the other hand, moving to a new location means uprooting your family and your current life and heading into unknown territory – not an easy or cheap thing to do. That's why it's important to negotiate a favorable corporate relocation deal with your company to make the move smoother and easier. Take a look at some tips that will help you negotiate the most beneficial relocation package for you.
Decide What to Ask For
You don't want to just go into a negotiation without a clear idea of what you're asking for. Narrowing down your requests and having a specific focus can help you come out of the meeting with more of what you really need. It helps to start with an idea of what kind of benefits are typical in your company's employee relocation packages. You can ask the human resources director if they have a written relocation policy with standard benefits, ask coworkers who have moved about their relocation experiences, or ask friends working in the field what typical relocation benefits are like.
Most companies offer to do things like cover moving costs, temporary lodging costs, and travel costs. Some offer assistance with helping your spouse find a new job in the new area or assistance in selling your home or getting out of a rental lease early. You may also be able to negotiate for things like child care assistance or a cost-of-living raise.
Consider Tax Implications
It's not uncommon for companies to offer a signing bonus or relocation to employees that are relocating. In many ways, it can be simpler for companies to give you a lump sum of money to move. Instead of dealing with all of the details of an individual employee's move, they simply cut a check and let you take care of the rest. There are definite benefits to accepting a lump sum in return for making a move. This way, you have the flexibility to spend money where you think that it's most needed.
However, there are also drawbacks to accepting a cash bonus – namely, your tax responsibility. Bonuses are considered "supplemental wages" by the IRS and are typically taxed at 25%. That means that out of a $5000 bonus, $1250 of it belongs to the IRS, leaving you with only $3750.
Before you accept a lump sum, consider other possibilities. You may be able to negotiate with your company to get them to pay your moving expenses directly, which will not increase your tax burden. Keep in mind that this may mean that you'll have to go with a moving company of your employer's choice, instead of choosing your own. Alternatively, they may be willing to increase the amount of your bonus so that it covers the taxes and leaves you with the original amount of the bonus you were supposed to get. This practice is called grossing up.
Don't Forget Non-Monetary Benefits
Moving to a new city or state can be overwhelming, and there are many things that your company can do to ease the transition that don't cost anything but that can be very helpful to you. For example, if you have children or if you're caring for an elderly relative, they can help you locate resources you'll need in your new city, like schools, daycares, nursing homes, or medical centers.
They may be able to put you in touch with one or more of your colleagues who already live in your new city who can help you learn the lay of the land. That way you'll have contacts who can help familiarize you with the features of your new city before you arrive.
Don't be afraid to ask for something unusual that will help make your move easier. The purpose of a negotiation is to come up with a mutually beneficial arrangement, and you may be surprised by what your company is willing to do to accommodate your needs.
For more information, talk with the company you're relocating with and talk with local moving companies, such as Bekins Van Lines Inc.