GUEST COMMENT: An internal overseas transfer may not be such a good idea after all
In the good old days when a bank sent you abroad it was a good gig; the first time I ever had servants was when Citi put me up in Sydney in a rather nice apartment.
The general principle was that you'd be kept at the standard you had back home, plus a bit to compensate for the hassle of being away.
It ain't like that no more. Over the last couple of years I've been increasingly contacted by people who've had it strongly 'suggested' that they relocate as part of a business reorganisation, and they're not happy at all about the terms.
A line that apparently all HR people have been told to use is 'that's your problem'. This applies to just about any costs that come with the move. And when converting your pay to the new currency, expect the persons in HR to use exchange rates that you won't find on Reuters - and, no, they are not in your favour.
Unsurprisingly enough, our recent salary survey showed that bankers in New York don't earn 20% less than bankers in London. And yet, HR seem surprisingly unwilling to accept this. They also seem surprisingly unwilling to structure expenses in the most tax efficient way possible. Will they compensate you for that? *Hollow laugh*
To be fair they don't always say it's your problem. More often, they say, "that will be taken account of in your bonus." This is, of course an industry standard lie: if you move to a new office your bonus can't be assumed to be as good as it is now because you risk losing visibility.
As a headhunter, I've read the bonus policies of a few banks and they're hilariously uncorrelated. Reality is that a key term in your bonus allocation is your visible productivity. If your boss is sending you somewhere he can't see your work, that work doesn't exist, and it's obvious that bad news about your work travels far better than things done right.
This is on top of the fact that, even if you're being moved to a country where they speak English, you can't live as efficiently as you can in a city you know well. Finding somewhere to live seems to be a major issue. HR will commonly offer to pay 'up to 60% of the cost' whilst you keep your London home, but even that is taxable. Tokyo is famously expensive, but everywhere else is not much better. Living like a westerner in most emerging markets can get very expensive quickly and you should flatly ignore any statements from HR that the "cost of living in Singapore / Shanghai / Athens is much lower than London", sometimes pointing to the cost of MP3 players as if they are a major part of your cost base.
I talk a lot about HR, because it's their job to do the dirty work. I know this, because the people I advise get told by their boss to 'talk to HR, they will sort it out' even if you're effectively taking a big pay cut for the good of the team.
When writing these pieces I normally offer some way of making it better, but the process is well designed to minimise the costs of the bank at your expense. Unfortunately, therefore, the best thing you can do is to assume from the start that you're going to be shafted and to make sure you've started looking for another job before 'suggestions' that you move become threats.
Dominic Connor is a Director of P&D Quant Recruitment.
