Assignments are not holidays – and why paid leave a is a critical part of every negotiation

17 December 2019

To employees who remain in their home country, the idea of giving paid vacation to expats can seem laughable. Instead of staying in the home office, they are selected (usually from a heavily over-subscribed group of willing volunteers) to spend a year or two on an expenses-paid trip to somewhere exotic. Some might see this as a holiday in itself.

Of course, expats have the same entitlement to paid leave as those they leave behind. Indeed, that need may even be greater, and it is for quite different reasons. When global mobility teams sit down to negotiate compensation packages, holiday entitlement is a key factor – and they should resist the temptation to default to the standard allocation they give to everyone. Here’s why.

Expats feel the pressure

Holidays are not just about snorkelling, sunbathing or walking around medieval towns. The reason they are considered standard in modern employment contracts is that employees need a pressure-valve – a way of releasing the tension.

Being an expat is definitely not easy. Expats have to deal with many difficulties that domestic employees never face, and the pressure of dealing with different cultures, rules and working practices can be intense. A few days off and people come back to work refreshed, happy and ready to go again.

The spectre of mental health

Everyone feels pressure at work. But combine professional pressure with the isolation felt by expats – frequently in combination with an unsettled domestic life – and you have a recipe for something more than simple work stress.

Mental health is a real issue for assignees and is increasingly being recognized by the mobility professionals who manage them. A study by AXA-Global revealed that more than two-thirds of companies were concerned about international assignments failing due to mental health problems; 21% described themselves as “very concerned”.

Mental health is a complex field, but one fundamental way of minimizing it is to ensure assignees have sufficient holiday entitlement.

Maintaining links with home

One of the ways of alleviating the stress of living abroad is to have regular opportunities to return home. Less clinically, global assignees will simply want to return home on occasion, whether it is to maintain friendships, take a break or to attend key events, such as family weddings.

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You’re halfway there...

There’s an old joke about a man stopping his car to ask a local for directions. The answer is: “Well, I wouldn’t start from here”. The point is that expats are often already halfway around the world on their travels. There will be amazing further travel opportunities on their doorstep. What would normally be an expensive holiday of a lifetime may be only a short-haul flight away.

One of the most valuable aspects of an overseas assignment from a personal point of view is the opportunity to travel further once you’re there. This opportunity is part of the package and carries a value – and should, therefore, be taken into consideration alongside the financials.

Diligent Americans, work-shy French?

Typical local holiday entitlement may differ by country. One of the factors that determines expat compensation is the salary paid to local equivalents, so why should this not hold true for paid vacation? The trouble is that there is so much variation, as shown in a study by CEPR (Center for Economic and Policy Research).

In the US, employees have no legal right to any paid vacation; in France, every worker is entitled to take 30 days off every year. Even if official holiday allowances are similar, there may be different cultural norms that apply. In some countries, employees feel encouraged to take a break for the sake of well-being; in others, people can feel that they will be seen as more committed to the company if they don’t.

Also take into account public holidays. Some countries have very few; in others, it can seem like every other week. Not only will public holidays offset the need for paid leave, but global mobility managers should also be aware of them from a planning perspective.

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Take some time off to think about it

The conclusion has to be to think carefully about each situation. As shown above, paid vacation means something very different to expats, and global mobility departments need to ensure that they do not simply cut and paste standard holiday and leave entitlement policies into the expat package. Giving the appropriate level of paid leave is a key tool in ensuring expat well-being and increasing the chances of a successful assignment.

There’s more to it

Paid leave is just one part of the compensation package that needs to be calculated. Find out more about the different ways in which assignees are remunerated by reading our article: Relocation allowance: what's included and what is it for?

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