Deploying Talent on Short Term Assignments. Desiree Fulton Global Mobility, Tax & Immigration Policy Scotiabank

Transcription

1 Deploying Talent on Short Term Assignments Desiree Fulton Global Mobility, Tax & Immigration Policy Scotiabank Jennifer Connell, SGMS, CRP Manager, Consulting Services Weichert Relocation Resources Inc.

2 Agenda Short Term Assignments Drivers of Short Term Assignments and Alternative Programs Example of Short Term Assignment: Scotiabank Alternative Assignments

3 Volume Expectations for Short Term Assignments Significantly Decrease 10% 9% Decrease 0% 7% Remain Unchanged 43% 54% Increase 27% 40% Significantly Increase 5% 6% CERC Survey, Trends and Volumes for 2012

4 Why Short-Term and Alternative Assignments? Greater pressure to respond to business unit needs. The speed of business is accelerating the increase in alternative assignments more than cost savings. 57% of employers worldwide feel the talent shortage is preventing them from growing. The Human Age A new era where people are recognized to an unprecedented level as the key to companies success and economic prosperity. (ManpowerGroup) Short-term assignments are increasing at a faster rate than traditional long-term assignments, a trend confirmed by numerous surveys. Expected to increase somewhat or significantly by 14% (CERC) Expectations for long-term assignments and permanent transfers in 2012 are consistent with those reported in 2010

5 Strategic Role of Mobility Changing employee demographics Skills gaps and critical labor shortage Alignment with Talent Management Evolving corporate needs (e.g. growth into new markets) Cost containment and transparency

6 Key Business Drivers 6

7 Short Term Assignment Challenges STAs aren t as easy to manage as anticipated Companies may relocate more employees more frequently on STAs, thus boosting overall program costs Unexpected tax consequences if assignments aren t executed properly If the assignment transitions into long-term, it may change the assignee s tax status Short-term assignments don t always result in full cultural assimilation, which is key to developing global leaders and a big part of ROI for any international move

8 Scotiabank Desiree Fulton Global Mobility, Tax & Immigration Policy Global Mobility Policy Short-Term Assignments

9 Scotiabank Profile 77,000 employees, 55 countries, 19 million customers 3 Core business lines, Canadian Banking, International Banking, Global Banking Markets 2011 Annual Report: 5.3 billion profit 2011, up from 4.3 billion

10 Scotiabank Markets 2

11 Scotiabank Culture 3

12 Scotiabank Global Mobility Statistics Total Global Mobility assignments: 239 Total Long-Term Assignments 208 Total Short-Term Assignments 31 (13% of total) STA structure supports development, projects, training Typically, Director level or less Typically, younger demographic, single or married, no children 4

13 Scotiabank Configuration Global Mobility Policy & Administration is centralized Business line HR assists business line management in selecting candidate Global Mobility Admin prepares all assignment letter & compensation packages globally Outsourced: Relocation vendor; Tax & Immigration; Cultural Orientation; Language Global Mobility is only approver of exceptions; exceptions are minimal; tracked by relocation vendor & reported monthly STA costs usually shared by home & host locations 5

14 Scotiabank STA Package Applied to assignments > 6 months < 24 months Monthly Cost of Living Allowance (COLA) based on host city Country Allowance, if applicable (% of base) One bedroom furnished accommodation Excess baggage to ship personal goods Family remains in home location principle residence Frequent home visits < 10 hrs flight time = every 8 weeks > 10 hrs flight time = every 12 weeks Tax equalization employment income Tax consulting; annual tax filing preparation home & host Immigration consulting; work permit issuance / tracking Global Mobility is only approver of exceptions; exceptions are minimal; tracked by relocation vendor & reported monthly STA costs usually shared by home & host locations 6

15 Scotiabank - GM Policy Review More guidance / definition to assist business line in determining type of assignment structure appropriate Greater involvement with Talent Management group to identify top talent developlment / strategic leadership positions & paths STA perceived as cheaper than long-term assignment package, but often equal to, or greater cost Exception requests for flexibility on STA home visits Exception requests for flexibility on STA family accompanying assignee 7

16 Draft Model for Differentiating Assignee/Assignment Types Talent based framework to determine assignment type and drive the mobility package provided to the employee Two dimensions: 1. Development value and 2. business value/need Learning Experience Strategic Leadership Opportunity - Key Job at Division Higher Target Employees: Source Pool (Emerging Leader) GM Financial Approach: Participant will bear some of the costs. Target Employees: Top Talent Key Person GM Financial Approach: Full assistance no Mobility incentive req d Accommodation of some exceptions Development Value Lower GM Approach: Expectation that employee will be on assignment (2 years or less). Career management process to obtain next role. Target Employees: Employee initiated moves Commodity Job Non Strategic Roles GM Financial Approach: Minimal assistance or support provided by the Bank. GM Approach: Bank has no plans /expectations for employee to return to existing location GM Approach: Expectation of 3-5 yrs. Career management process to obtain next role. Skilled Position (management or technical) Target Employees: Critical Resource** GM Approach: Expectation of 3-5 yrs. Career management process to obtain next role. GM Financial Approach: Full assistance Mobility incentive appropriate Accommodation of reasonable exceptions to facilitate Lower Business Value/Need Higher 8

17 Facts - Employees on Assignment Globally Level Breakdown: 5% SVP 26% VP 43% Director 14% level 8 12% level 7 Business Line Breakdown: 77% International Banking 10% Global Wealth Management Including GTB 8% Global Banking & Markets (excluding local plus) 5% Corporate Functions Duration of Current Assignments: 28% Less than 1 year 55% 1 5 years 14% 5 10 years 3% More than 10 years Number of Years of Service: 13% Less than 5 years 33% 5 15 years 26% years 15% years 13% Over 35 years The ratio of men to women on assignment is 3:1 9

18 Alternative Programs - Volume Expectations 18

19 Commuter Assignments COMMUTER ASSIGNMENTS Assignment involving travel between home and destination countries for a specified number of days per month, with a set maximum of return trips home. The employee typically stays on home country payroll but expected to work in the host country on a frequent/defined basis. 58% 61% Benefits provided: 97% Immigration 94% Tax Consultation/Return Preparation 92% Home/Host Travel 75% Tax Equalization 61% Host Transportation Allowance 61% Temporary Living 50% Extra Baggage Yes Formal Policy

20 Extended Business Travel EXTENDED BUSINESS TRAVEL 72% Employee travels regularly to an international location for an extended period of time (typically up to 1-2 weeks) to work on key business projects. Benefits most frequently provided: 97% Immigration 69% Home/Host Travel 66% Temporary Living 51% Tax Consultation/Return Preparation 49% Host Transportation Allowance 32% Yes Formal Policy

21 Rotational Assignments ROTATIONAL ASSIGNMENTS A series of two or more assignments, typically short in duration (e.g. 1-3 months) with the employee returning to the home location for a set period of time, or to a different location. 42% 71% Benefits most frequently provided: Immigration Tax Consultation/Return Preparation Host Transportation Allowance Home/Host Travel Tax Equalization Temporary Living (host) Extra Baggage Housing Allowance Hardship/Location Premium Yes Formal Policy

22 Core-Flex CORE-FLEX 20% Yes 91% Formal Policy A program in which a basic set of fixed ( Core ) and optional ( Flex ) benefits are provided, resulting in an assignment/transfer package that is customized to the employee s circumstances and needs or the budget/cost constraints of the business unit. Benefits most frequently provided: Core Immigration Tax Consultation/Return Preparation Medical Exam/Vaccinations Miscellaneous Allowance Household Goods Flex Language Training Cross-Cultural Training Pre-transfer Trip Housing Allowance Settling-in Services

23 Which Programs are Most Effective? 100% 90% 80% 70% 87% 78% 74% 85% 81% 60% 50% 40% 30% 20% 10% 0% Commuter EBT Local Plus Rotational Core/Flex 23