Typically, a commuter assignment is one where the assignee’s principal residence remains in their home country, they are unaccompanied and return home at frequent intervals. These assignments are most often used for pragmatic or tactical reasons. For example, the need to fulfill project work, often at short notice and to overcome barriers to mobility, such as dual career couples and concerns over children’s education.
Despite rising commuter assignment numbers, they still usually only account for a small proportion of a company’s entire assignee workforce. We have seen an increased use for situations within a region, particularly the EMEA region in this regard.
Nearly 70% of companies in ECA’s recent International Commuters Survey expect their commuter numbers to rise further in the next three years and give employee demand and family issues as the most common reasons why. About a third of companies are expecting more commuter assignments because they perceive them to be more cost-effective and/or quicker to initiate than other assignment types. But some of the cost savings can be lost due to higher living expenses that come with the need for conveniences (i.e. furnished housing close to work).
Additionally, there frequently are increased costs for managing these types of assignments as they can take more insight from a variety of expensive professionals, like tax, payroll and immigration stakeholders. As ECA International explains, "Tracking the number of days spent in each country is vital for ensuring compliance. The complexity of tax and social security of a commuting arrangement may not only mean more administration for the company but also more involvement from external tax specialists, all of which comes at a cost."
Ultimately, companies use this type of assignment cautiously and really need to think through the unique dynamics at play for each situation. Some best practice considerations would be:
- Be ready - create a policy so that you have it, if and when you need it.
- Understand situations to apply - make sure that the family will be able to adjust to one parent no longer being there for periods of time (i.e. does the partner feel abandoned?).
- Establish recommended trip distances - consider whether this type of assignment needs to be limited to any specific roles or employee levels (i.e. for senior management strategic roles as opposed to technical-based roles). Often, we see commuter status limited to trips that do not exceed four hours.
- Set specific duration limits - establish a reasonable length of time for these assignments to avoid costs escalating and/or assignee burnout.
In the 2019 AIRINC Mobility Outlook Survey, commuter policy was identified as the top policy that companies are planning to add this year.
The rise in commuter assignments is not wholly driven by employees, however. About a third of companies are expecting more commuter assignments because they perceive them to be more cost-effective and/or quicker to initiate than other assignment types. The survey shows that in recent years companies have been making salary packages for commuter assignments leaner, but they are not necessarily cheaper than more traditional assignments. While the costs of relocation and potentially international school fees or family-sized accommodation in the host location are avoided, most companies are picking up the cost of the weekly commute as well as daily living expenses and accommodation costs in the host location.