Cost is often the main concern when considering a commuter assignment as an alternative to a long-term assignment accompanied by family. But the financial implication is far from the only factor that matters when deciding if a commuting arrangement is right for both the employee and the company.
Multiple workplace vs. personal choice
Commuter assignments, where the employee works in the host country and travels back to their home country roughly once a week, can broadly be split into two types:
1) There is the employee who lives and works in one country but has regular workdays in one or more other countries: a “multiple workplace commuter”. For example, a regional manager may live in the Netherlands where they work two days a week and spend the other three days in Belgium. As commuting is an integral part of their role and might even be an indefinite arrangement, they are often not considered as an assignee by the company.
2) Then there is the employee who chooses to take up a position in another country without their family as an alternative to a more traditional long-term expatriate assignment, allowing them to return home every weekend. This employee could be defined as a “personal commuter”.
This article focuses mainly on personal commuter assignments. However, even for a multiple workplace commuter where there is no question of relocating family (since the employee is still required to work in the country in which they live), some of the same issues arise which may not be considered beforehand by the company.
A way to overcome barriers to long-term assignments
An employee is most likely to turn down a long-term assignment because of their family. ECA’s Managing Mobility Survey 2016 found that the impact on family, partner’s career or children’s education were the most common barriers to long-term assignments. Around a quarter of all participating companies, and 41% of European companies, reported that they use commuter assignments to overcome these kinds of challenges.
If an employee turns down a standard long-term assignment, and if the distance between the home and host locations is relatively short (usually a maximum of three to four hours’ travel time), a commuter assignment might be suggested instead. This seems to be a logical solution: a commuter arrangement encourages the employee to accept the host country role while avoiding the huge impact that uprooting their family to another country would cause. But there is much more to a commuting arrangement than just leaving the family at home and weekly travel.
The financial cost
Commuter assignments can often seem like a cost-efficient mobility solution for the company but what a company might save with one hand, it could spend with the other.
Convenient accommodation
Convenience is a priority for commuters to make the most of their work time in the host country, so they may need to stay in a small furnished central apartment close to their workplace. This may not come cheap. While it might cost less than renting a family home in the suburbs - a viable option if the assignee is accompanied by their family - it could negate the “savings” that are gained from not relocating a family. For multiple workplace commuters, depending on the number of days they typically spend in the host country, hotel or serviced accommodation close to the workplace is more likely to be provided, again at a high cost.
Higher living expenses
Not only is a commuter assignee likely to be living more “conveniently”, and therefore expensively, in the host location than at home or when on a long-term assignment, but they may also be dining out more or shopping in small, more expensive convenience stores in the city centre rather than large out-of-town supermarkets. On top of this, they will still be maintaining a household in their home country. Typically, a subsistence allowance or per diem will need to be paid to a commuter to cover their meals and the cost of other basic goods and services for the days that they spend in the host country. Alternatively, they could expense these costs, though this means administration for the company as well as for the employee.
Managing tax and social security compliance
The tax position as well as the social security position of commuter assignees can be particularly challenging to manage, with possible liabilities and payroll obligations in both the host country (where they work) and their home country (where they are based and where they may also have work days). Tracking the number of days spent in each country is vital for ensuring compliance. The complexity of tax and social security of a commuting arrangement may not only mean more administration for the company but also more involvement from external tax specialists, all of which comes at a cost.
These costs apply whatever the reason for commuting. But when commuting is used purely for personal reasons and an alternative approach exists, there is more focus on the cost to the company.
The professional and personal impact
Then there are the costs that are harder to quantify: the impact on the job itself and the employee’s personal life.
From the employee’s perspective, the benefits of an international assignment accompanied by their family usually stretch beyond the job and their career. The opportunity for the whole family to live in a different country and to learn a new language and culture can be very attractive. If the assignment goes well, it can be a wholly fulfilling experience, with a healthy balance between personal and professional benefits. When ECA runs satisfaction surveys for long-term assignees on behalf of companies, non-work-related factors regularly feature just as highly as the job itself as being the most enjoyable aspects of an assignment.
The assignee is appreciative of the opportunity given to them and their family by the company, and perhaps more likely to accept another assignment if asked. A successful assignment can engender loyalty from the assignee, which is particularly important if they are considered top talent and the company has long-term plans for them.
So what can happen when the employee goes on assignment without their family as a commuter? That healthy balance between personal and professional benefits is lost; it becomes all about the job and then trying to get home to their family as soon as possible every weekend. The whole assignment experience is of a completely different nature to that of a long-term assignment accompanied by their family.
In this case, we could argue that at least the assignee can just concentrate on their job in the host location and they don’t have to worry about how their family is adapting to another country. Difficulties with family adjusting to the host country can be a distraction and typically one of the main reasons for assignment failure, so if the assignee goes alone, their employer should presumably be seeing the best possible results?
Commuting could in fact have a detrimental impact on the employee’s ability to do their job, especially for roles that require strong relationship-building. Their host country colleagues may see them as an outsider: arriving on Monday, working late during the week to make up for lost time and then leaving early on a Friday (or earlier if they can work from home some days). That lack of professional and social integration with the host company could affect their performance in an unforeseen way, in addition to the stress of frequent travel.
Then there are the pressures faced by the assignee’s family on their own in the home country. Their partner may feel unsupported in the day-to-day raising of any children, with frustration on both sides at the assignee’s absence. The precious little time that the employee is at home is spent catching up on all home-related matters, and not just with their family. Maintaining a healthy work/life balance becomes difficult and, eventually, there often needs to be a compromise. The commuter may even become resentful towards their employer because of the situation and start looking for other opportunities.
Using commuter assignments selectively
Bearing these points in mind, is it right for an employer to encourage or allow employees to commute? There needs to be transparency and pragmatism on both sides; the company and employee should acknowledge the potential impact on the employee’s performance, career, well-being and personal life. The employee may not think the arrangement will be a problem for them or their family, and for some it won’t be. Ultimately the company cannot decide this for them, but their insight and advice may help the employee to make a more informed decision.
The company also needs to weigh up the potential risks to the business of a commuting arrangement against the employee not accepting the role at all. If there are no other suitable candidates, then the company may have little choice. Some assignments are unsuitable for a family in any case, such as those in remote or dangerous locations. Likewise, commuting is rarely possible over long distances. But where it is practically possible, establishing clear criteria as to when commuter assignments are allowed can help ensure their use is limited.
What is the nature of the assignee’s role? – Some companies will only allow commuter assignments for senior management due to the strategic nature of their roles. But others find that technical-based roles are better suited to a commuting arrangement as integration with the host company is not as important.
How long is the assignment intended to last? – To minimise the risk of employee burnout, it is advisable to set a maximum length for any commuting arrangement, whether for personal reasons or due to multiple workplaces. One year or two years are often cited as maximum periods for commuting.
Why does the employee want to commute? – Not all employees who request a commuting arrangement do so to avoid relocating a family. Some simply prefer to continue living in their home country as a lifestyle choice or perhaps they have other commitments unrelated to a partner or children. Every company will form a view as to what constitutes a good enough reason to support a commuting arrangement, considering the cost and other consequences, though it’s important to treat each request fairly and consistently.
Can anything be done to overcome an employee’s concerns about relocating their family? – Perhaps the company could engage a specialist education consultant to find a solution to their concerns for their children’s education, perhaps considering distance learning of the home country curriculum. Maybe a specialist partner support consultant could help to identify professional training for the assignee’s partner to help them enhance their career, so that their return to the job market in the home country will be easier. If the company can address such issues to allow the family to accompany the assignee, the effort could pay off in the long term.
Conclusion
A commuter assignment can be an ideal way for an employee to further their career when their family can’t or don’t want to relocate on an international assignment. But if not managed carefully, it can potentially become a professional and personal burden producing a resentful employee. To help companies in determining whether to approve commuting arrangements, global mobility teams should raise awareness of the costs and potential risks of commuter assignments and consider building a policy which defines the circumstances in which commuting would be permitted, as well as the pay and benefits conditions. Companies will then be better equipped to ensure that commuter assignments are only used when necessary and not as the “easier” option.
FIND OUT MORE
Please contact us to speak to a member of our team directly.