Assignments into New & Challenging Locations

Agenda Topics

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Understanding the issues

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Providing support

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Alternative options

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Proper career planning

Understanding the Issues

We are sending someone to Myanmar to start up operations there. The assignee has already agreed to take the assignment. It’s a new location for us. Make it happen!

Aaaaaah!

Vendors who can help with immigration, tax, etc.

New country setup protocol or a cross functional team Internal Security Department

Mobility Framework:

Recruitment and retention issues will occur if your mobility framework is not adapted to meet the needs of challenging locations. Flexibility is important.

Duty of Care:

Evacuation and contingency plans are critical. Reputational and employee risk if not properly planned.

Mobility Policy:

Many “expat goodies” and soft services were eliminated during the recession and policies were adopted that were not well suited to challenging locations. Does your policy have Hardship? R&R? Cultural Training? DSP?

What makes a location challenging?

Lack of International Schools

Security Concerns Inadequate Medical Care

Substandard Housing

Frequently changing immigration or tax laws

Limited Goods and Services

Small or no Expatriate Community

Remoteness

Boredom

Political Instability

Assignee Family Business Company

Addressing Challenges

• Perception of risk for taking assignment to a less “visible” location • Recognition for taking an assignment to a difficult location • Knowing when to allow or not to allow for accompanied status • Providing support to accompanied or unaccompanied families • Need to attract talent to the host location • Balancing operational requirements with frequent leaves • Developing markets may not have funds to support assignment • Coordinating with security department • Need to focus on duty of care • Retaining employee in talent pipeline

Classifying Challenging Locations

C International School Security Medical Care Housing Shopping Expatriate Community Variety of accredited international schools Security risk low; no additional company support required Top quality medical care; all urgent needs met Wide range of international quality housing available All goods and services available Diverse and large expatriate community Only one or limited international option Security department recommends driver or other precautions Local routine care is adequate; major care not available Limited international quality housing available Some international brands unavailable Moderate size expatriate community; may be of limited diversity No accredited schools Security department recommends major precautions; guards Limited clinic services Only substandard or temp. accommodation available Basic goods only Very limited expatriate community

Alternative Approaches

A, B, and C Locations

A B

Standard Long Term Assignment Benefits Standard Long Term Assignment Benefits - PLUS Additional Provisions to meet Host Location Needs

C

Alternate Mobility Approach

Tailoring the mobility package to host location conditions adds to the safety and success of an assignment. Flexibility is important!

Resident Assignment in a “B” Location

PRE-ASSIGNMENT VISIT

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Allow the assignee to visit the location before moving; help set the right expectations SETTLING IN SERVICES

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Ensure the assignee and family have adequate support from DSP; extra days may be needed MEDICAL

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Assignee and family should have a medical check prior to travel Evacuation insurance should be in place INVOLVE SECURITY

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Corporate security department should review host location and approve residential areas Evaluation of need to provide car and driver, guard, or other security measures EMERGENCY PLAN

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Ensure you have an evacuation plan in place and assignee knows what to do in case of emergency and what is covered for self service HARDSHIP

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Hardship should be offered and tailored to host location

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Ensure your scale is high enough: 40% is becoming a more common max among non-Oil companies; among Oils, up to 80% REST & RELAXATION LEAVE

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An R&R benefit should be part of the Standard LTA offerings for challenging locations Up to two trips per year to a nearby location

Alternative Approaches for “C” locations

Unaccompanied:

• Employee resides in host location, family stays behind at home • Additional home leaves provided

Commuter:

• Employee travels to host location and returns home weekly or monthly

Accompanied, Proxy:

• Worksite and assignment location are different, but both in an international location • Family lives in assignment location and employee travels to worksite during week •

Rotator:

Assignee alternates between a scheduled amount of time working when in the host location and not working when at the home location

Choosing the Right Assignment Package

Are host location conditions adequate to support a fully resident long term assignment?

YES Is there adequate schooling?

YES NO Do operational requirements require full time staffing of position?

YES NO Standard LTA NO NO Is there schooling in a nearby city?

YES 1 month on 1 month off Rotation 6 weeks on 2 weeks off Rotation Unaccompanied Assignment Proxy Assignment

Case I: Assignment from UK to Lagos

Joe Accountant

 Needed in Lagos for 2 year assignment  Spouse is a high income earner in UK  Has a special needs child and proper education not available in Lagos

Unaccompanied assignment:

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4-6 Home Leaves a year to visit with family

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No R&R Standard Lagos hardship payment Host Location allowances based on single

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status No housing deduction (Norm)

Case II: Assignment from Australia to Samara, Russia

Moscow Samara Julie Plant Manager

 Needed in Samara for a 5 year assignment  Has two children  No international school in Samara, but Samara is 2 hour flight from Moscow • • • • •

Proxy assignment: Family on assignment in Moscow Assignee commutes to Samara on Monday, returns on Friday Hardship premium based on Samara COLA and host housing based on Moscow Assignee’s lodging and transportation covered in Samara

Case III: Assignment from US to a Remote Construction Site in UAE

Sam Engineer

 Needed in UAE to complete 12 month construction project  Construction site in remote field location  Camp environment; no local housing, shopping, recreation

Rotator Assignment:

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Employee works 6 weeks on, and is home 2 weeks not working

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Hardship premium for days spent in UAE only No cost of living support as daily needs provided in camp

Alternative Approach Watch-outs

Unaccompanied:

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COST:

If the assignee has a large family, unaccompanied status may be less expensive • • because education costs would not be paid and the housing budget would be less. But if the assignee has a small family, the cost of extra home leaves and potential additional taxes may cause an unaccompanied assignment to be more expensive than an accompanied one

FAMILY:

Separation from family for extended periods may put strain on the assignee and family

POLICY:

If rationale for unaccompanied status not clearly stated, policy may be abused

Accompanied, Proxy:

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TAXES:

The worksite and the resident location should, preferably, be within the same country. If in two separate countries additional and complicated tax liabilities may arise.

Rotator:

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POLICY:

A separate policy is needed to govern this assignment type •

TAX:

Employee may not be able to break home residency; additional tax costs may accrue

Proper Career Planning

Out of Sight, Out of Mind

The biggest complaints from assignees in challenging locations are: I found it challenging to settle into the assignment because I did not receive adequate company support. I am worried about finding my next job in the company; it is hard to network while I am here.

When I returned from assignment, the valuable skills I learned working in a difficult location were not used or valued.

This assignment location is not a key center for the company; I feel like I am missing out on opportunities.

Proper career planning is critical for assignments to new or challenging locations and can serve as more of an incentive than Hardship or other cash allowances

Talent Management

Following the assignment lifecycle, there are three phases of talent management: Pre-assignment Candidate assessment & selection On-assignment Mentoring, monitoring assignee engagement, career planning Post-assignment Job placement, utilizing skills, tracking attrition

Career Planning

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Targeting employees with “Global Mindset” and ability to adapt culturally

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Setting assignment goals to drive success

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Identifying potential roles for the next job within the company

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Rewarding assignment with future career growth

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International assignment as part of a well developed career plan

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Assignee mentoring