Relocation policy template
Copy the text below and replace everything in square brackets with your company details.
1. Purpose
This policy sets out the relocation support [Company Name] provides when an employee moves to a new work location on joining or at the company's request.
2. Scope
It applies to new hires and transferred employees whose new work location is more than [100] km from their current residence. The decision to transfer an employee is governed by the Transfer policy.
3. Benefits
- Travel: one-way travel for the employee, spouse, up to [2] dependent children and dependent parents, as per the employee's entitlement in the Travel policy.
- Moving: packing, transport and transit insurance of household goods through [an approved mover], up to [₹Amount], plus transport of one two-wheeler or car.
- Temporary stay: hotel or serviced accommodation for up to [15] days at the new location, within Travel policy limits.
- Settling-in allowance: [one month's basic pay or ₹Amount], paid with the first salary at the new location.
- Rental deposit: an interest-free advance of up to [₹Amount] for the security deposit, recovered over [10] months.
- Brokerage: up to [₹Amount] for the new rented home, against a receipt.
4. Lump-sum option
Instead of the itemised benefits, the employee may choose a lump sum of [₹Amount], paid with the first salary at the new location, and manage the move personally.
5. Process
- The employee shares a relocation plan with dates and family details with HR at least [15] days before the move.
- HR obtains the mover's quotation and confirms the approved amounts in writing.
- Claims for items not paid directly by the company are submitted within [60] days of the move, with bills.
- The employee receives [3] days of paid relocation leave in addition to the travel days.
6. Recovery on early exit
- If the employee resigns, or is dismissed for misconduct, within [12] months of the move, relocation costs are recovered in proportion to the months not served.
- No recovery is made if the company ends the employment for reasons other than misconduct, or transfers the employee again.
- The employee signs the recovery terms before any relocation cost is incurred.
7. Tax
Payroll applies income tax rules to each relocation payment, and the employee is told before the move which parts are likely to be taxable.
8. Responsibilities
- Employee: plan the move with HR, use approved vendors and submit claims on time.
- HR: approve plans and amounts, coordinate vendors and track recoveries.
- Finance: pay vendors and claims promptly and record advances.
9. Review
HR and finance review relocation limits every [12] months against moving costs and rental deposits in the company's main cities.
What to include
Who qualifies
Set a distance or city-change rule, such as more than 100 km. It separates genuine relocations from moves within the same metro area.
Itemised benefits
List each benefit with its limit: travel, movers, temporary stay, settling-in allowance, deposit advance and brokerage. Itemised limits make offers quick to prepare and easy to compare.
A lump-sum alternative
Offer a lump sum to employees who prefer to manage the move themselves. It cuts paperwork on both sides and suits single employees with few belongings.
Recovery terms signed first
Have the recovery terms signed before any money is spent. Pro rata recovery over 12 months is fair and easier to defend than recovering the whole cost.
The family that moves
A move works only when the family settles, so include the spouse, children and dependent parents in travel and temporary stay rather than covering the employee alone.
Common mistakes to avoid
- Negotiating relocation afresh for every hire, so similar people get very different packages.
- Paying relocation costs before the employee signs the recovery terms.
- Recovering the full cost when the company itself ends the employment soon after the move.
- Leaving out dependent parents who move with the employee.
- Forgetting to recover the rental deposit advance when the employee exits.
Run it in ZeniaHR
In ZeniaHR, a transfer is recorded in the employee's lifecycle history, and the organization assignment is updated with the new location and reporting manager. Approved relocation claims are added by HR as reimbursement inputs in Direct Payroll, and a rental deposit advance is recovered month by month through advance recovery deductions. The signed recovery terms and approved relocation plan are stored in the employee's documents.
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Book a free demoSee pricingFrequently asked questions
What does a relocation policy cover?
It covers the support given when an employee moves to a new city for work: travel for the family, packing and moving household goods, temporary accommodation, a settling-in allowance, help with the rental deposit and brokerage, and the terms on which costs are recovered if the employee leaves soon after.
Can a company recover relocation costs if the employee resigns?
Yes, if the employee agreed to recovery terms in writing before the move. A common approach recovers costs in proportion to the unserved part of a 12-month period. Recovery should not apply when the company itself ends the employment for reasons other than misconduct.
What is a settling-in allowance?
A settling-in allowance is a one-time payment that helps an employee set up home in the new city, covering things like basic furniture, utility connections and small repairs. It is usually a fixed amount or a month's basic pay, paid with the first salary at the new location.
Do transferred employees get relocation support too?
They should, when the company asks them to move. Transferred employees face the same costs as new hires, often more, because they are moving an established household. Apply one relocation policy to both, and let the transfer policy decide when a transfer happens.