Global Pit Stops

International short-term assignments remain popular
International short-term assignments remain popular

RISMEDIA, October 23, 2006?Often less costly than full expatriate assignments, short-term assignments of three to 12 months remain popular among multinational employers, according to a majority (60%) of survey participants who cited increases in the number of such assignments in their organizations. Some of the popular destinations for these assignments include China, India, Korea and Vietnam. More than 530 North American, European, and Asian-based multinationals participated in the ?2006 Survey of Short-term International Assignment Policies??conducted jointly by Worldwide ERC, ORC Worldwide, and TheMIGroup?a follow-up to similar studies in 2000 and 2003.

?HR managers are under continual cost-cutting pressure to reduce costs, and have looked in recent years to short-term international assignment programs to help shave expenses,’ says Worldwide ERC?s Jan Hatfield-Goldman, vice president, research and education. But cost reduction is no longer the primary driving force in the ongoing shift to shorter assignments from the more traditional expatriate assignments that last a few years.

Hatfield-Goldman notes that in particular, short-term assignments today are useful in completing specific projects (80.4%) and transferring knowledge (72.5%), and also offer a potential solution in situations where dual-career issues inhibit an employee from accepting a full expatriate assignment.

?As shorter assignments increase in popularity, managing them has become a significant challenge for HR and business-unit managers,’ says Hatfield-Goldman. A key difficulty reported by nearly half of our respondents is controlling the length of the assignment. The survey revealed that when a short-term assignment extends beyond the predetermined duration, it can lead to other challenges, such as ensuring tax compliance with host-location regulations (45.8%) and complying with immigration regulations (27.3%).

Since 2003, there has been a 7.8 percentage point increase in the number of companies not offering incentives for short-term assignments. At present, more than half (57.3%) of the participants do not pay incentives. This figure is highest for Asian-based organizations (69%) and lowest for those based in Europe and the Middle East (52.4%). In addition, 53.2% do not pay a hardship premium in locations where a long-term assignee would receive one. Once again, Asian-based firms are less likely to pay such a premium in comparison to other multinationals. RE

For more information about the ?2006 Survey of Short-term International Assignment Policies,? please visit ERC?s Web site, www.erc.org.

Source: RISMedia’s Real Estate magazine, October 2006.