Relocation Repayment Agreements = ROI, Do the Math!

Posted by: Karen O. Wilks, Vice President, Client Services

At a time where every dollar a company spends is highly scrutinized, sending an employee on an international assignment can be both a significant financial investment and a substantial risk. To minimize that risk many companies are utilizing repayment agreements. In fact, recent Cartus survey data indicates that most companies are using repayment agreements. 

There is good reason to have repayment agreements in place. Despite the acknowledged importance of linking mobility and talent management, 61% of companies said they don’t track the percentage of assignees that leave their organization within two years after an assignment. And despite the cost of assignments and the risk of lowering assignment ROI when assignees leave the company, 75% of survey respondents do not address post-assignment career tracking. And 36% of companies don’t track the incidence of early returns from assignments.

Cartus has a technology-driven solution, including the ability to provide an esignature, to administer the repayment process, ensuring that the employee has a vested interest in the success of the organization, and understands their personal commitment.

The combination of both the employee and client understanding the financial parameters, coupled with Cartus' administration of the repayment agreement can ensure that all involved share the same understanding, while minimizing your risk.

Business Objectives and Risks

It is important to identify your business objectives, and risks, when thinking about using repayment agreements. Here are just a few things to look at:

What do you hope to achieve?

• Return on your investment
• Creating a talent rich pool and keeping critical talent within the organization
• Increased employee productivity

What are your risks?

• Financial
• Lack of productivity
• Incomplete or failed assignments
• Talent depletion, when the employee comes back from their assignment more marketable and leaves the organization

How Can Cartus Help?

Cartus can help your organization manage the repayment agreement process in a number of ways:

• Offer an easy technology solution to administer the process for you
• Educate you on the best solution for your organization
• Provide benchmarking to assist in decision making
• Give both you and the employee confidence in a transparent process,   ensuring employee engagement
• Assist in your retention strategy
• Provide governance of the repayment process to minimize your risk

Our process is simple, as the employee can sign and upload the Repayment Agreement via our online system. The client notifies Cartus in the event of an employee departure, and the collection of funds can be managed by Cartus, or by your company, depending on preference.

If you have additional questions on how to manage your repayment agreement process, contact your Cartus representative or email us at trustedguidance@cartus.com.