Index of Relocation Terms

Allowances/Incentives: Payments made, separate from base salary, to recognize the special demands of moving a household out of the home country, separation from family and friends, and in some locations, difficult living conditions or hardships.

Amenities: Those settings or improvements to property which increase the desirability or enjoyment rather than necessities of the residents. For example, a pool.

Arrival at the Assignment Location: Many employers have found that assignees find it helpful to be met at the airport on arrival, either by employees at the host location or by a representative of a service group. If the assignee will not be met at the airport and has not spent time in the new location, specific instructions should be provided detailing how to get to the hotel, along with the standard rates usually charged for transportation.

Assignee: Some companies use this term to refer to an employee sent from one country (or location) to another for a temporary period of more than six months.

Assignment Letter: A document prepared in advance that specifies details of the assignment, including location, terms of service, compensation package, travel, relocation benefits, and tax treatment. Prior to departure, the employee will be given an assignment letter and schedule outlining compensation, allowances, length of assignment, and other details specific to the employee's situation.

Assignment: The duties at the worksite as described in an assignment letter and all amendments, extensions, and appendices.

Career Counseling/Search Services: Firms that provide career counseling/search services for employers, relocated employees and spouses.

Closing Costs: Expenses, fees, commissions, taxes, and other related costs payable in relation to the sale of a residence.

Condominium: In the U.S., housing unit in which each owner has title to his own living space and shared possession with other residents of such common areas as lawns and tennis courts.

Co-op: In the U.S., property, such as an apartment, whose title is held by a corporation with residents owning shares in such corporation that entitle them to occupy a certain amount of living space.

Cost of Living: Cost of living refers to how much a market basket of goods and services required for living costs and how it changes over time. In the U.S., the cost of living may be measured by the Consumer Price Index (CPI) which measures the change in consumer prices, as determined by the Bureau of Labor Statistics' monthly survey. CPI components include the costs of housing, food, transportation, and electricity.

Destination Agent: The provider responsible for providing services at the assignee's destination.

Destination Services: Assistance provided to the assignee upon arrival in the host country, usually including assistance in finding a residence, arranging schooling for dependent children, and guidance regarding shopping, transportation, driver's licenses, etc.

Emergency Leave: In the event of serious illness or the death of a member of the immediate family, the employer may reimburse one round-trip airfare for the assignee or spouse. If a member of the family passes away while abroad, local authorities and the consulate or embassy of the home country should be contacted immediately to make sure the deceased is released without red tape and delay.

En Route Expenses: Expenses related to final trip at time of move for employee and family.

Estate and Gift Tax: Any taxes related to the distribution/ donation of the assignee's personal assets.

Family Members: Family members could be defined by employers as the assignee's spouse or partner, dependent children who normally reside with the assignee and dependent children through age 23 who attend college whether they reside with the assignee or attend college elsewhere.

Freight Bill: The document indicating the actual cost of the move.

Gross-up: An increase to a salary, premium, or allowance which is designed to deliver a specific net amount to the employee after the payment of taxes.

Gross Weight: The total weight of the van and the assignee's shipment.

Home Leave: The employee will reimburse this leave to enable the assignee and family to visit relatives in the home country and arrange for personal needs, such as medical or dental treatment. Home leave is generally scheduled annually, the travel costs generally cover the entire family's return to the point of origin in the home country.

Homesearch Trip: A trip for the purpose of finding housing in the new area. Generally, one trip which covers the employee and spouse, but this could vary from employer to employee.

Household Goods Move: Shipment by surface carrier of household goods effects. (Usually includes smaller shipment may be made by air of articles which will be needed prior to arrival of surface shipment.) It often also includes storage of any household effects which the employee cannot practically move (such as automobile or furniture which is not needed), or would not want to move to the new country.

Lease Cancellation Penalty: A fee charged to a tenant in the event the tenant breaks the lease before the term of the lease has expired.

Liability (Relative to Cargo in Transit): The maximum amount for which a carrier is normally financially responsible in connection with loss or damage of cargo while in transit or storage.

Mail Forwarding Services: Firms providing mail forwarding services for transferees on international assignments.

Miscellaneous Expense Allowance: It is customary to give the international assignee an allowance to cover out-of pocket expenses not otherwise covered by corporate policy, this allowance usually is one month's base salary, and is frequently, but not always, grossed-up for taxes. Generally, the employee does not need to provide receipts or document how the allowance is utilized. However, the allowance is intended to be used for moving expenses (fixtures, fittings, drapes, carpets, and appliances, deposits), on repatriation, it could be used for cosmetic or other repair work on the employee's principle residence that was rented while the employee was abroad.

Outsourcing: Retaining the services of a vendor to perform a function which was previously performed within the organization.

Per Diem: A daily payment to an employee, usually consisting of the three elements (meals, hotel, and miscellaneous expense) designed to cover temporary living expenses at the host location.

Permanent Transfer: A transfer to another country with the intent that the transferring employee will become a permanent employee of the assignment location.

Point of Final Destination: The location to which the employee and accompanying dependents travel and where the employee's personal effects are shipped at the completion of the term of assignment.

Point of Origin: The location from which the employee and accompanying dependents depart for the worksite, or as otherwise agreed, and from which personal effects are shipped to the destination worksite.

Pre-assignment trips: In order to help the assignee and spouse make an informed decision about whether to accept an overseas assignment, many employers send them on a brief visit to the city and country to which they have been asked to move. These visits provide the couple with a chance to spend time in the new location addressing questions before the move.

Prohibited Articles (Relative to Cargo Shipment): Articles which movers will not handle, such as explosives and flammables.

Relocation Leave: The intention of the relocation leave is to provide time off work in between assignments in preparation for moving and for taking care of personal business, such as closing of accounts, obtaining copies of school records, supervising movers, etc. This time off may be in addition to vacation or personal leave.

Relocation Policy: A policy of benefits and services provided by an employer to aid an employee and his/her family in the transfer process.

Short-Term Assignee: An employee who leaves his or her home location to work in another location for a period of time greater than an extended business trip, but less than an expatriate or long-term assignment.

Tax Briefing: The assignee should meet with the company-designated tax consultant for an initial review of their tax position before departure. This tax consultation is designed to provide the employee with an understanding of his/her tax liability while he/she is on an assignment. Personal information is held in strict confidence with the tax consultant and is not shared with the company. During an international assignment the expatriate is likely to incur an income tax liability in the assigned country. In order to make income tax considerations as neutral as possible during an assignment, the employer may implement a tax equalization or tax protection policy. This policy intends that the employee bear approximately the same tax liability during the assignment as he/she would if his/her base salary, home-country incentive compensation, and personal income were earned at the employee's point of origin. The tax briefing is designed to provide an overview to the process.

Tax Equalization Policy: Similar to tax protection, tax equalization functions to compensate the assignee for the additional foreign and home country tax cost resulting from the assignment. However, the principle difference under a tax equalization program is that the employer attempts to equalize the assignee's tax burden so it is neither greater nor less than the amount of tax due had she remained in the home country. If the tax burden is higher than a comparable home country assignment, the company reimburses the assignee for the excess taxes. On the other hand, if the total tax costs are lower than they would have been on a domestic assignment, the savings are passed on to the company-not the assignee. There is no windfall to the assignee if actual taxes are lower during the foreign assignment. This results in the assignee's spendable income remaining relatively consistent with that of her domestic counterpart.

Tax Equalization: A method for calculating an employee's worldwide tax burden wherein the employee pays no more or less in taxes than he would have paid in the home location. The employer deducts a tax contribution from the employee, then pays all actual taxes to the host and home governments.

Temporary Housing Services: Firms providing living quarters on a nonpermanent basis, internationally.

Temporary Living Expenses: For both expatriate and repatriation assignments, temporary living expenses are usually covered in full for the employee and family for a reasonable period. Most employers limit the period of temporary living to a certain number of days in order to manage costs and ensure the household goods shipment is coordinated with the date assignment or return. In general, the temporary living period will be extended to accommodate unavoidable delays.

Underwriting (For Mortgage and Insurance): The process of reviewing a completed mortgage application file and determining if both the applicant and the property meet the lending guidelines of the investor. Also, the process of reviewing an application for insurance to determine if applicant and property to be insured meet insurer's guidelines.

Valuation: The value the assignee places on his goods when releasing them to the carrier.