World events have had a significant impact on global mobility over the last ten years. From the global financial crisis of 2008 to the unpegging of the Swiss franc against the euro in 2015, the challenges for mobility have been unprecedented. With an increased regulatory environment and tax transparency here to stay, meeting the mobility challenge remains as tough as ever, despite program advancements.
The latest global mobility survey from KPMG Switzerland highlights how global mobility has evolved during the past decade, the key risks which all employers with internationally mobile employees should be addressing today, and what companies could do to improve their mobility policies and processes.
Key survey findings
- Over the past ten years, many companies have introduced new forms of mobility to meet the changing needs of business and changing patterns of global mobility and business travel. Policies for commuters, business travelers and local to local transfers are some of the most common new policy types and now the norm for moves within many organizations.
- Although many companies report increases in the number of female assignees over the past ten years, gender diversity remains low among international assignee populations.
- Switzerland has become even more costly as an assignment destination, and bringing assignees to Switzerland has become more challenging in recent years.
- Advances in technology allow for greater control over compliance obligations and greater data analytics possibilities. Most companies have seen a greater use of technology in their mobility programs and expect to see more over the coming years.
Based on the findings of the 2016 survey, here are the key recommendations for any company with internationally mobile employees:
- Review the social security and pension situation of your internationally mobile employees: an international career can leave significant gaps in an employee’s pension coverage, and a potential exposure to the employer if the implications are not appropriately communicated. Many companies are turning to an international pension plan in order to mitigate the adverse consequences of an international career on an employee’s future pension entitlements.
- Pay special attention to your frequent business travelers: without proper monitoring an employer may unwittingly be exposed to tax and social security risks. Work permit and immigration risks should not be underestimated as the penalties for individuals working abroad without the appropriate work permit can be harsh. Diligent tracking of business travelers and a solid process to be able to identify risks up-front are key to ensuring compliance.
- Consider whether you have enough types of policies in place to adequately cover all of your mobile population: the trend over the last ten years is for companies to expand their portfolio of policies in order to meet the demand for more flexible cross-border arrangements. International assignments now take all shapes and forms, with weekly commuters, short-term assignments and extended business trips becoming more common. Formalized policies for these types of arrangements ensure equity of treatment amongst employees and reduction of risks for the company.
- Assess whether your technology is up to the job of ensuring global compliance: for many companies, technology has become the key to achieving and maintaining compliance. Once a company’s internationally mobile population reaches a certain size, manual tracking and processes are unlikely to be sufficient to ensure compliance with all regulatory requirements in today’s high-tech environment, in which tax, social security and immigration authorities are becoming more connected than ever before.