Expert Info

Posted by germanborn
on 3 Oct 2018

My company has offered me a 3-year expat assignment in Melbourne (moving from New York City). The company is relatively small and I am their first expat. Therefore, there is no standard expat contract and me and the HR VP have to negotiate it from scratch. I have done a lot of research, but was hoping to get some advice on a number of things that could become sticking points:

1. I own a co-op apartment in NYC, which I don't want to sell. It was suggested that I rent it out and that the company will pay for the difference between my rental income and the cost of renting a place in Melbourne. I have read on many sites that companies often pay for Mortgage and Maintenance of the home and/or for the rent in the host country? What are your experiences? Is it reasonable to ask for the company to pay for rent in Melbourne while I will continue to pay for mortgage/maintenance in the US, so I don't have to rent the place?

2. I have read that companies often pay for the cost of having a car in the host country. I will obviously have to sell my car in the US (and will be asking for a forced sale loss compensation). Do your companies pay for your car lease?

3. Is it common to receive a foreign service premium? I understand that Melbourne ranks higher than NYC in Mercer's rankings and that cost of living is lower in Melbourne. But is it still reasonable to ask for the foreign service premium?

4. Is anyone receiving a spouse support package? My husband will give up his company in the US and will need to find something to do in Australia. 

5. Lastly: do you have a recommendation for a great moving company from NYC to Melbourne?

Thanks,

 

Ralph

Daniela de Castro on 15 Oct 2018

Hi Ralph

Sue, from Relocation Services Australia, has offered the following response to your questions: 

1) Is it reasonable to ask for the company to pay for rent in Melbourne while I will continue to pay for mortgage/maintenance in the US, so I don't have to rent the place?

Our experience is that certainly the larger companies will pay for the rental in the country the expat is moving to.  There is often a deadline to this and mostly coincides with the duration of the visa.  Smaller companies do have smaller budgets and you may find it a little harder to negotiate.  You may find that putting your apartment on the rental market is not a bad idea (you could perhaps put your furniture in storage? and have your company pay for that?)  

In Australia, home owners can take out an insurance against damages and / or loss of income due to rent not being paid.  These insurance fees could also be part of your negotiation if the company is not prepared to pay your full rent in Australia, together with a top-up of the difference in rent?  You could argue that if you were to sell in NYC city, you would find it very hard to get back into the market upon your return.  

I would start by getting some quotes on what your apartment would rent out for and we can then also have a chat about what you'd expect to pay on rent in Melbourne.  This is largely dependent on where you'd like to settle.

2) Do your companies pay for your car lease?

Again, many of the larger companies do provide cars, but this also depends on whether the expat is of executive status or not.  It all comes down to how large the company's budget is.  Smaller companies don't necessarily offer this but may package the salary accordingly.

There are a number of options available if the company does not provide a vehicle, such as car sharing, Uber, or short-term leasing.  All of these options really depend on where in Melbourne you wish to settle.  If you are close to the city centre, you may find that you won't necessarily need a car and can rely on the odd Uber or car sharing facility which tends to work very well for most expats. 

3) Is it common to receive a foreign service premium? 

Definitely!  Even though this is probably a huge opportunity for you, there are always negatives in terms of the points you've made above and it would be only fair to be compensated for this.

4) Is anyone receiving a spouse support package?

Many of the companies that we work with do have spousal support packages available to them, but these support services are often offered in the first instance in the country of departure.  If there is any further budget, they will engage us to provide support.  

We outsource these services to third parties. Which brings me back to your third point you brought up in terms of being paid a foreign service premium - you have a very strong argument that you will (certainly initially) be relying on one income only, rather than the two incomes you currently have.

Have you managed to successfully negotiate your expat contract? Our guide to working in Melbourne might also be helpful to you.

- Daniela

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