Employee Relocation Policy Template

Relocating for a new role or internal transfer can be an exciting opportunity — but it also comes with logistical and financial challenges. A clear employee relocation policy ensures that when team members move to support business needs, they’re fairly supported with transparent guidelines, covered expenses, and helpful resources.

This policy outlines who is eligible for relocation assistance, what’s covered, how the reimbursement process works, and what responsibilities both the employee and company share throughout the relocation journey.

What the Employee Relocation Policy Should Include

To be clear and effective, your policy should address:

• Purpose and scope: Why the policy exists and who it applies to.
• Eligibility criteria: Which roles, levels, or relocation types are eligible.
• Covered relocation expenses: What’s reimbursed or paid upfront.
• Reimbursement process: Deadlines, required documentation, and submission steps.
• Tax treatment: Whether relocation assistance is considered taxable income.
• Relocation bonus vs. reimbursement: If applicable, explain both options.
• Relocation support vendors: Use of third-party relocation providers, if any.
• Repayment agreement: Terms if the employee voluntarily leaves shortly after relocating.
• Exceptions or custom packages: When leadership or HR may make case-by-case decisions.

Purpose of the Employee Relocation Policy

The purpose of this policy is to:

• Support employees who are relocating for company-approved reasons.
• Offer clarity around eligible expenses, reimbursement timelines, and expectations.
• Promote a consistent and fair approach to relocation benefits.
• Ensure legal and tax compliance with all relocation-related reimbursements.

Sample Employee Relocation Policy

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Effective Date: [Insert Date]
Policy Owner: People Team / HR Department
Last Reviewed: [Insert Date]

1. Policy Overview

At [Company Name], we recognize that career growth and business needs may sometimes require employees to relocate. To ease the transition, we offer relocation assistance for eligible employees, designed to reduce financial burden and support a smooth move.

This policy applies to eligible internal transfers, promotions, and external hires who are asked to move more than [Insert mileage or geographic threshold, e.g., 50 miles] from their current residence.

2. Eligibility

Relocation assistance may be offered to:

• New hires relocating for full-time roles
• Current employees accepting internal transfers or promotions that require relocation
• Employees relocating at the company’s request for operational or strategic reasons

Eligibility is determined on a case-by-case basis and must be approved by both the employee’s department leader and the People Team. Relocation is generally not available for:

• Temporary assignments under 6 months
• Fully remote positions
• Employees who decline an offer to remain in their current location when an alternative exists

3. Covered Expenses

Relocation packages may include reimbursement for the following approved expenses:

Moving Costs

• Professional moving services
• Rental trucks or equipment
• Packing and unpacking assistance
• Insurance for personal belongings during transit

Travel to New Location

• Mileage reimbursement or airfare for employee and dependents
• Hotel stays during travel
• Meals (within daily limits)

Temporary Housing

• Hotel or short-term rental for up to [Insert #] days upon arrival
• Lease break fees (if applicable and pre-approved)

Home Search and Lease Assistance

• House-hunting trips (up to [Insert #] trips for the employee and/or partner)
• Rental assistance, deposits, or lease fees (if applicable)

Miscellaneous

• Driver’s license updates, vehicle registration
• Utility setup fees (internet, electricity, water, etc.)
• School search assistance or childcare referrals (optional and location-dependent)

Note: All expenses must be pre-approved and submitted with itemized receipts to qualify for reimbursement.

4. Reimbursement Process

Employees must:

1. Submit a completed Relocation Reimbursement Form via [Insert HR system or platform].
2. Attach original receipts or invoices for all claimed expenses.
3. Submit documentation within 30 days of the expense or move-in date.

Reimbursements will be processed within [Insert timeline, e.g., 2–3 payroll cycles] after receipt and approval of all documentation.

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5. Lump-Sum Relocation Allowance (Optional)

In some cases, [Company Name] may offer a one-time, lump-sum relocation bonus in lieu of itemized reimbursements. This approach provides flexibility but may be taxable income to the employee and is not subject to reimbursement tracking.

Eligibility and lump-sum amounts will be determined by the hiring manager and People Team.

6. Tax Implications

Per IRS guidelines, relocation benefits are considered taxable income. Unless otherwise noted:

• Relocation reimbursements will be grossed up for tax withholding (if applicable)
• Employees are responsible for any tax liabilities on lump-sum payments

We recommend consulting a tax professional for personalized advice.

7. Repayment Agreement

If an employee voluntarily resigns or is terminated for cause within [Insert period, e.g., 12 months] of their relocation date:

• They may be required to repay all or part of their relocation reimbursement or bonus
• A prorated repayment schedule may apply
• The terms will be outlined in the signed Relocation Repayment Agreement during onboarding or transfer

8. Exceptions and Approvals

[Company Name] reserves the right to approve, adjust, or deny relocation assistance based on:

• Business needs
• Budget constraints
• Employee role or seniority
• Specific relocation circumstances

Requests for exceptions must be submitted to the People Team and approved by the [Insert level, e.g., Head of HR or CFO].

Frequently Asked Questions

1. Do I have to use a specific moving company?
No, but we recommend using licensed, insured movers. If you’re using a relocation vendor, we’ll provide a preferred provider list.

2. Can I claim expenses after I’ve relocated?
Yes — as long as they’re submitted within 30 days of your move and are within the scope of the policy.

3. Is relocation assistance guaranteed?
No. Relocation support must be approved and documented in your offer letter or transfer agreement.

4. What happens if I leave the company soon after moving?
If you resign within the repayment period, you may be responsible for reimbursing the company as outlined in the signed agreement.

5. Is my relocation allowance taxable?
Yes. Under current tax laws, most relocation payments are taxable. We’ll include this on your W-2 at year-end.

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