According to a recent KPMG survey, half of mining industry respondents expect to increase their use of international assignees over the next 5 years. Whether these are experienced expatriate workers or employees new to the game, such assignments can be costly with a high failure rate.
In addition to upfront relocation expenses, there are ongoing costs ofhousing, transportation, cost-of-living, language and cultural training, kids’education, and trips home. Employers are also expected to fund any difference innet salary resulting from moving to higher-tax regimes.
Individuals and families often fail to adapt without familiar home comfortsand support. Yet, 47 percent of respondents to KPMG’s survey say their companyoffers no cross-cultural training, and 39 percent do not screen employees.Repatriation is also often inadequate, which can increase the chance ofattrition.
Many companies do not operate a wider workforce resourcing plan, making it harder to coordinate assignments around the world.
A well-oiled mobility machine requires coordination between the potential assignee and the business unit head, Human Resources (HR), Payroll, GlobalMobility, Tax, Finance, and third party tax, relocation and immigration service providers.
Employees should undergo formal assessments for their suitability, with the results used to either inform go/no-go decisions, or as a guide for further training and coaching. Due to favorable domiciliary tax rates, some nationalities may be cheaper to send on assignment than others – as will individuals with smaller or no families.
Failure to comply with local laws and regulations on visas, tax and socialsecurity can lead to penalties, deportation and damaged reputations. With laws changing rapidly, employers must systematically keep on top of developments andensure that all assignees are fulfilling their official obligations.
Mining companies need to evaluate the overall return on their investment inexpatriate workers. This calculation involves tracking ongoing costs andbenefits, including estimating the ‘purpose’ and ‘business value’ of the international assignment program.
Finally, a smooth, well-planned repatriation can increase the chance ofemployee retention, with a formal transition process, ongoing support throughout the assignment, regular discussions about future career moves, and a full repatriation plan at least 6 months in advance of the end of the assignment.