Post #110,504
7/19/03 6:11:54 PM
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relocation handcuffs
Got the letter from the Georgia company Friday afternoon. In there is a clause that states (paraphrased) "if I leave for any reason, other than termination by the company, I owe them all relocation expenses. This is in effect for a two year period from your start date". They will provide some cash for living expenses in the first paycheck after one month's employment.
Couldn't reach the HR person, so left a voicemail, and got an email back from her. Basically, she says that she's sorry that this was never mentioned before, the clause is standard in all offer letters, they will not remove it or even modify it. At my last 2 employers, each relocation package was pro-rated so that, for example, if I left after 1 year, then I only owed them 50% of fronted expenses. The Georgia company will not do this. Also, they will not "gross up" any monies to help cover the income taxes that I'll have to pay on these monies or on the value of moving company charges. Lastly, I don't like being held responsible for the cost of relocating my family without knowing what those costs are. I'd have to get copies of all moving company bills from the employer to verify costs, and I'm pessimistic that they'll provide them to me, yet I'll owe them for these charges. On top of that, if I pay taxes on these monies, and I leave them and have to repay them, can I get those taxes BACK???
Thoughts and comments please.
lincoln
"Four score and seven years ago, I had a better sig"
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Post #110,518
7/19/03 9:09:47 PM
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Re: relocation handcuffs
Comment - shut the fuck up and get to work.
-drl
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Post #110,522
7/19/03 11:26:32 PM
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the standard agreement for one year is extended to two in
these times, be glad you get ANY relo I am interviewing WITHOUT that. It also means they wil be loathe to let you go in less than 2 years which IS a form of Job Security.
thanx,
bill
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Post #110,532
7/20/03 2:03:47 AM
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*If* you want to negotiate this...
...contact an attorney, familiar with GA labor law, first. This clause may be over broad in duration, scope, vesting, or other issues. \r\n\r\n Given you're looking at a 24 month committment on the part of yourself and your family, I'd strongly recommend a review. Period. Should be available for a few hundred bucks. \r\n\r\n I'd look at the possibility of negotiating 24 months to 12 (or 18), or pro-rating the relo on a monthly, quarteryly, or annual basis. \r\n\r\n In fact, I'd look very strongly into the pro-rata option, on a monthly or quarterly basis. As things stand, your employer will have a large firing bonus over your head at 24 months minus one day. I would not want to work under those terms. \r\n\r\n IANAL, TINLA, YADA. --\r\n
Karsten M. Self [link|mailto:kmself@ix.netcom.com|kmself@ix.netcom.com]\r\n
[link|http://kmself.home.netcom.com/|http://kmself.home.netcom.com/]\r\n
What part of "gestalt" don't you understand?\r\n
[link|http://twiki.iwethey.org/twiki/bin/view/Main/|TWikIWETHEY] -- an experiment in collective intelligence. Stupidity. Whatever.\r\n
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Post #110,544
7/20/03 10:31:50 AM
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no "firing bonus"
if I leave for any reason, other than termination by the company Darrell Spice, Jr. [link|http://www.spiceware.org/cgi-bin/spa.pl?album=./Artistic%20Overpass|Artistic Overpass]\n[link|http://www.spiceware.org/|SpiceWare] - We don't do Windows, it's too much of a chore
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Post #110,571
7/20/03 3:25:20 PM
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Doh!
I'd still pro-rate the costs, at least through the 2nd year. --\r\n
Karsten M. Self [link|mailto:kmself@ix.netcom.com|kmself@ix.netcom.com]\r\n
[link|http://kmself.home.netcom.com/|http://kmself.home.netcom.com/]\r\n
What part of "gestalt" don't you understand?\r\n
[link|http://twiki.iwethey.org/twiki/bin/view/Main/|TWikIWETHEY] -- an experiment in collective intelligence. Stupidity. Whatever.\r\n
\r\n
Keep software free. Oppose the CBDTPA. Kill S.2048 dead.\r\n[link|http://www.eff.org/alerts/20020322_eff_cbdtpa_alert.html|http://www.eff.org/alerts/20020322_eff_cbdtpa_alert.html]\r\n
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Post #110,535
7/20/03 3:15:31 AM
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Re: relocation handcuffs
How much are we talking about? I'd suggest that if it's less tan a few thousand dollars then just ignore it.
qts
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Post #110,585
7/20/03 5:29:04 PM
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Moving the household
The expenses would include:
- the total moving costs for packing and moving my household
- roundtrip airfare for the wife and children, hotel and meals for them up to 3 days in a househunting trip
- expense money upfront to temporarily subsidize my living in town while the family lives 800 miles away
Even with considering that moving companies give good discounts to corporations, and that I'd be TAXED on all of this eventually, you're looking at an easy $10 - $15,000. Will they show me copies of their actual bills from the moving company? I doubt it. If I leave them and have to pay it back, can I get reimbursed for the taxes that I paid on all of it? If not, that's an additional penalty.
If I can't get them to shorten the time frame, at least I'm going to request prorating the amount as time goes by.
lincoln
"Four score and seven years ago, I had a better sig"
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Post #110,590
7/20/03 6:55:14 PM
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The last time I went thru this
I was given 15K grossedup with tax taken out and they paid the moving Bill.
Just means your job is safe for two years.
thanx,
bill
questions, help? [link|mailto:pappas@catholic.org|email pappas at catholic.org]
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Post #110,595
7/20/03 8:22:09 PM
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Dangerous territory
My ass-kissing corp side shows up.
1) Is it possible the offer will be withdrawn based on your attempt to negogitiate.
2) Were you given a $$ amount for moving relo during negotiation, or did
they say, "Don't worry, We'll relocate you"?
If #1 - shut up, unless you think they are screwing you, and you can accept the OK job.
If #2 == Don't worry - shut up. You are done negotiating. You lost your leverage when you told them yes (offer letter or no, they KNOW you want the job over all others).
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Post #110,688
7/21/03 11:46:35 AM
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Re: relocation handcuffs
My biggest surprise with this is the fact that they are paying taxes (for you) on this. Technically, at least as far as I know, it's an expense, which means that they pay for it with no tax consequences to you. I was relocated some years ago, and they tried to pay me it as a bonus (that is, they took out taxes, etc.). I called them up and explained that it was an *expense* (since in my case they were reimbursing me for the cost).
In that case, I'd be surprised if they could consider it relocation costs, since they're taxing it. Legally, you may be able to get it to be considered a bonux (such as a sign-on bonus). In which case, they can't require you to pay *any* of it back (as it becomes part of your salary).
You definitely want to have an lawyer look at it.
Dan
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Post #110,762
7/21/03 7:17:05 PM
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No they're not
My biggest surprise with this is the fact that they are paying taxes (for you) on this.
No they're not. Talked to the HR woman this morning. No bending on their part at all. No matter what happens, for whatever reason, if I end up employed elsewhere (or return home because of an emergency and not work) I owe them everything within 2 years of my start date. They will not "gross up" anything. On top of which, when I do relocate my family and pay taxes on the value of the package, what's to stop Uncle Sam from refusing to repay me the taxes on money that I return to the company? Double Whammy! lincoln
"Four score and seven years ago, I had a better sig"
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Post #110,772
7/21/03 8:01:07 PM
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IANAF-CPA but..
I'd bet a few bucks:
Simply, you'd file an amended tax return, with explanation. This is perhaps their most-FAQ. PITA? yes. Logical remedy? Yes. Should be no quibbles: after all, your claim would be easily verifiable by IRS.
Not to invent things to worry about.
HTH
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Post #110,777
7/21/03 8:29:55 PM
7/21/03 11:10:44 PM
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Uncle Sam will be no problem.
[link|http://www.irs.gov/formspubs/page/0,,id=11875,00.html|IRS Publication 521, Moving Expenses].
Alex
A government which robs Peter to pay Paul can always depend on the support of Paul. -- George Bernard Shaw
Edited by a6l6e6x
July 21, 2003, 11:10:44 PM EDT
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Post #110,797
7/21/03 11:05:34 PM
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Muchas Gracias!
lincoln
"Four score and seven years ago, I had a better sig"
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Post #111,256
7/24/03 10:56:47 AM
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Re: No they're not
By making the payment to you part of your W2, they pay payroll taxes. Even though they may not "gross up", they're being pretty stupid by paying it to you as part of your salary (as a bonus, not base pay). If they were to "expense" it, then they wouldn't have to pay taxes as all (on their side or yours). Hence, my surprise is that, 1) it costs them more since they have to pay payroll taxes (which they may take into account, but they don't *have* to do it that way; 2) they're taking more of the money away from you by not expensing it. So, they're hurting everyone involved by being stupid.
Now, that's separate from the whole two-year thing, as it appears that that sort of thing is becoming more common. Personally, it's pretty rude (especially because they force you to have to do the whole ammended taxes thing), but it's their business, and they believe they're helping it out that way (which they're probably not, but that's a separate argument). Best of luck with it.
Dan
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