Congrats! You have landed a great job in a new state. Once you finish your happy dance, it is time to settle in for some negotiations. Of course, you have probably done your research and are ready to talk about salary, but before you leave it at that, consider that you may also have room to negotiate a relocation package to cover some or all of the costs of moving. In fact, getting this part of the negotiation right can add up to thousands of dollars in cost savings for you and your family.
What Types of Jobs Include Relocation Assistance?
If employers can easily fill a position from the local population, they often opt to do so for several reasons. First, concerned about costs, most employers would rather not pay relocation assistance at all. Second, local employees tend to have greater ties to the community which can translate into less risk of losing talent who the company has invested time and money to train.
However, upper level management, executive positions, and highly technical jobs are often difficult to fill without considering candidates from a larger geographic region. The same is true for most occupations where a high level of education and specialization is the norm such as physicians, academics, and engineers.
Whenever top talent is in short supply, employers become willing to offer relocation assistance to attract the best in critical positions.
Although it is rare for entry level jobs to include a relocation package, there are some exceptions. For example, in some cases an exploding demand for employees with entry level skills and training may create conditions where they are recruited from out of state with modest relocation packages offered to sweeten the deal. In other cases, such jobs may not offer relocation assistance, but they may offer a “sign-on” bonus that you will be offered upon accepting the job that you could use to cover your moving costs.
What Does a Relocation Package Cover?
The answer to this question will vary from one company to the next as well as for each individual position within the company. In some cases, relocation packages are standardized and applied equally across the board while in other cases there is room for negotiation. Most packages include some combination of the below types of assistance:
Transporting your family to your new location is a cost that is often covered. This may include airfare, mileage, hotel costs, and in some cases food expenses during your move. If you are planning to start your job before your family moves with you, you may be able to negotiate travel expenses back and forth to spend time with them for a specific number of trips during the transition.
New Home Search Trip
Your new employer may offer to pay for one (or more) trips for you (and possibly your family) to travel to your new town to meet with a realtor and locate a new home. In many cases this will include travel, hotel, and sometimes a per diem for food while on your trip.
This type of benefit can cover fees such as closing costs and realtor commissions that come with buying your new home and/or selling your old home. If you are planning to rent in your new location, sometimes employers will be willing to pay security deposits for utilities or cover the cost of breaking your current lease.
This may include a monthly stipend towards rent, or with large employers in metropolitan areas, it may include temporary housing in apartments or condos that they lease for the purpose of helping new employees make the transition.
Packing and Moving Expenses
The costs of a moving truck and packing and unpacking services are sometimes included with a relocation package. The company may offer to pay the moving company directly or offer a reimbursement for these costs. Storage fees may also sometimes be added if they will be a necessary part of your move.
Job Search Assistance for Your Spouse
If you will be moving with your significant other, your new employer may offer to help your spouse find a job in your new town. Spousal employment assistance may include reaching out to contacts at other employers in the area, covering the costs of a job placement specialist, or even locating openings in the company for him or her to interview for what would be a good fit for their skillset. In rare cases, such as is sometimes the case with advanced professors in academic positions, you may even be able to negotiate a spousal hire at the company.
School and Childcare Help
Finding high quality childcare and schooling is a major issue parents face when relocating. In some cases, your new employer may be able to assist with locating good facilities. They may be able to even leverage their contacts in the community to help with midyear placement.
How to Negotiate a Relocation Package
If you have been offered your dream job in another part of the country, the great news is that your career is on track. The bad news is that a move can be a time consuming and costly process. A relocation package may make a significant difference towards easing the burden of uprooting your family to your new town or city. In many cases there is some room to negotiate these benefits to make sure you are covered for the expenses that you will need to transition smoothly.
Know What You Need Before You Raise the Issue
It is important to have your ducks in a row prior to having a conversation about relocation expenses with your new employer. That means, if you wait until you are offered a position, you may have a very short window to prepare for any negotiations. It may be wise to at least spend some time to think about what expenses you are likely to incur prior to even hearing back about the job, particularly if you got a strong feeling at the interview.
Take a look over the above types of relocation benefits and think through your move. Make a list of likely expenses, prioritizing those that are most important to you. That way, if you are offered a job, you are prepared to enter into salary and benefits negotiations with an informed perspective.
It’s All About Leverage
Just like salary negotiations, working with your employer to agree on a relocation package that is appropriate comes down to accurately estimating your leverage and effectively putting it on the table.
For example, if you know that you are extremely desirable for a position you are uniquely qualified to fill, then you have more bargaining power at the negotiation table.
In addition, positions that are higher in the company’s organizational structure, or those that are seeking top talent among highly skilled professionals, are the most likely to be those that employers are willing to shell out the big bucks for a move. If they could find local talent to match your skills, they would just as soon do that in most cases to save themselves the expense.
Like any negotiation, approach it calmly and rationally, and but don’t be afraid to advocate for your needs. After all, both you and your new employer want to get off on the right foot.
When Should You Ask About Relocation Benefits?
In almost all cases, conversations about the relocation package take place during or immediately following salary negotiations. Be prepared to open the conversation when the subject comes up, and if it doesn’t, don’t hesitate to raise it.
In many cases, discussing this aspect of your hiring package may be done with an HR professional who works outside of your direct chain of command, which can take some of the stress out of it. However, just be aware that it is critical to cover this vital aspect of your new job before signing a contract, since once you formally accept the job, you have lost most of your leverage to bargain for a better deal.
Frame Your Case in Terms of Benefiting the Company
One of the most important ways to boost your negotiation power during conversations about your relocation package is to frame what you need in ways that demonstrate a commitment to the company.
In other words, framing your requests as a win-win for both you and the employer is a way to keep things positive and to remind the employer that they are paying for services that ultimately will benefit their bottom line.
A good example of this technique is to emphasize that helping you with this or that aspect of your move will allow you to get started in your new position sooner, without the distraction of dealing with the relocation itself. For instance: “My family will be staying in San Antonio until the new school year begins in September. That will give us 4 months, by which time I am confident we will have closed on our new home. If you are able to cover temporary housing expenses for me, along with travel expenses for four visits during that time, I am certain it will help me to keep my focus on hitting the ground running in my new position.”
Pay Close Attention to Reimbursement Versus Direct Pay
There are four main ways that a relocation package may actually be paid by an employer:
- a single lump sum (also sometimes rolled into a signing bonus),
- reimbursement for expenses that you pay out of pocket and carefully track,
- direct billing through the service provider such as a moving company, or
- through a third party relocation company who will work with you directly to ease your move.
There is a big difference between expenses that are reimbursed and those that are paid directly from your employer to a service provider. Of course, immediately coming up with the cash is the main problem with reimbursements. Remember too that when you are paid before or after an expense is paid, the amount will likely be considered taxable income. If your employer pays for services directly or uses a third party to help with your move, this may not be the case.
Get It in Writing
Finally, once you have successfully negotiated your relocation package, it is reasonable to ask that the employer draft a letter or contract that details what they will cover, how they will cover it, and any pertinent deadlines. In some cases, a company may have a standardized policy (often detailed in a brochure or handbook) that they apply to each new out of state hire. However, if you negotiated any extras, be sure they are provided in writing, such as an email or letter, so that you can refer back to it in the event of a dispute or miscommunication.