December 1, 2020
The Relocation Committee has developed the following questions and answers in order to provide departments/agencies, bargaining agents and employees with information on the application of the newly released NJC Relocation Directive.
Q1. I see there is a new definition of “mortgage” in the Directive. What’s changed?
A1. What has changed is the way lending institutions have described the lending instruments that they have on offer. The new definition is intended to clarify which types of loans are considered to be a mortgage for the purposes of the Directive. The intent of the Directive was and is to reimburse expenses related to a standard first or second mortgage when appropriate under the Directive. That has not changed.
Q2. How and when will my relocation be authorized?
A2. All relocations must be authorized in writing. Employees will normally be advised, in writing, at least 30 days prior to the date the employee is expected to report to work at the new location. In some cases, this period may be reduced, but this shortening of the advance notice must be authorized by either the deputy head or the delegated departmental authority. The 30 days is a minimum notice period.
Q3. When can I start spending and/or move?
A3. No relocation will be authorized unless it is in writing and until it is registered with the Contracted Relocation Service Provider (CRSP). An employee cannot start spending and/or move until after having an initial consultation with the CRSP.
Q4. What is the 40 km rule?
A4. If the relocation does not meet the intent of Canada Revenue Agency’s 40 km requirement, all relocation benefits will become taxable.
Q5. Why does the phrase “relevant module of the NJC Travel Directive” appear often throughout the NJC Relocation Directive? What does it mean?
A5. The phrase “relevant module of the NJC Travel Directive” was used so as not to reproduce all provisions of the NJC Travel Directive.
The NJC Travel Directive is organized into four separate modules which govern the reimbursement of expenses associated with government travel. Module 1 covers travel expenses within the headquarters area, Module 2 covers travel outside the headquarters area with no overnight stay and Module 3 covers travel in Canada with an overnight stay. You will be reimbursed your travel expenses in accordance with the module that applies, which in most cases will be Module 3. This means that expenses such as transportation to the airport and the fees associated with your first piece of luggage will be covered as if you were travelling on government business, even if it is not explicitly provided for in the NJC Relocation Directive.
It is an employee’s responsibility to familiarize themselves with their entitlements in accordance with the Travel Directive.
Q6. There are a number of places in the Directive where it says that certain things may be authorized “in exceptional circumstances”. I see the definition of exceptional circumstances but I’m not clear on what those may be. Can you provide some examples?
A6. Some good examples of exceptional circumstances, based on things that really happened, are:
- While listed for sale, your home is struck by lightning and burns to the ground;
- On the day your household goods and effects are scheduled to be picked up, a forest fire closes all the roads into your community and the van lines are unable to reach your home;
- A death or illness in the family which interferes with the relocation; and
- A housing market where despite many list price reductions it proves to be impossible to sell the principal residence at origin.
The key elements are that the event is rare, i.e. something that doesn’t happen often, and beyond the control of the employee, i.e. not something resulting from a personal choice. An example of something that would not be considered an exceptional circumstance would be when an employee elects to have a new home built and the contractor fails to complete the house on time; the decision to build is a personal choice that always comes with a foreseeable risk that the builder will not complete the building on time.
Q7. Do I have to notify anyone if I am in the process of separating from my spouse?
A7. Yes. It is the responsibility of the relocated employee to notify the Contracted Relocation Service Provider (CRSP) of any dissolution of a marriage, spousal union, or indefinite separation. The employee must provide a written declaration or legal separation agreement as they may not be eligible for some of the entitlements under this directive.
Q8. My spouse/common-law partner and I have both been offered relocation from City A to City B by our departments. Does that qualify as two relocations?
A8. No, if you and your spouse are relocating from one place to another then there will be one relocation file. In this case, since you are both going from the same place, City A, to the same place, City B, there is no requirement for two relocations. The only exception would be if you are not being offered relocation within one year of each other. If, for example, you are offered a position and relocation from City A to City B and more than 12 months later your spouse is offered a position and relocation from City A to City B, in that case there would be two relocation files.
Q9. My spouse/common-law partner (who is not an employee) and I have both been offered relocations to another city by our employers. We expect to receive offers to relocate from both employers, will the NJC Relocation Directive still apply to me?
A9. If you expect to receive relocation benefits from your partner’s employer and an offer through the NJC Relocation Directive, you cannot claim both. Within 15 working days from your receipt of notification of the registration of the file and before any relocation expenses are incurred, the employee must choose which relocation benefit they will accept. The employee cannot choose both.
Q10. Can I change my mind and cancel my relocation after it has been authorized?
A10. There are two ways that a relocation may be cancelled. The employer may cancel a relocation for work related reasons. In that case, the employee will be reimbursed for expenses incurred up to the date of cancellation. If an employee wishes to cancel his relocation, it must be done prior to the packing and shipping of household goods and effects. The Departmental National Coordinator must approve the cancellation. Once household goods and effects have been loaded for shipping, the relocation cannot be cancelled.
Q11. The funding envelopes seem to have changed from the old Directive to the new one. Can you explain the change?
A11. There has been a change in the funding envelope structure. It was made to try and make it easier to understand which funds will be payable to you at the end of the relocation and which will not. Under the old Directive customized funds and personalized funds were in the same funding envelope. In the new Directive the customized fund is now a sub-component of the core envelope. Like core entitlements that are unused at the end of the relocation any customized funds that remain will be returned to the department. All of the funds in the personalized fund may be used to claim actual and reasonable expenses related to the relocation that are over and above the provisions of the Directive or may be cashed out at the end of the relocation.
Q12. Due to my relocation, my spouse is unable to find employment in his/her field at the new location. May I claim the cost of my spouse’s training course to enable him/her to acquire new skills in order to secure employment?
A12. No. Additional training or courses to provide the spouse with new skills or knowledge do not meet the intent of the employment assistance outlined in section 3.3 of the NJC Relocation Directive.
Re-certification and/or re-licensing (to obtain documents in a new province that were already held at origin) are not identified in this article, but do meet the intent of the benefit.
Q13. What expenses can be reimbursed from the Personalized Fund?
A13. Where the employee meets the criteria, but exceeds Core Fund limitations (e.g. receives 30 days Interim Accommodation, Meal and Miscellaneous Relocation Allowance from the Core Fund, but requires 35 days before possession date at destination), reimbursement can be made for additional, reasonable and justifiable expenses from the Personalized Fund, with the exception of amounts exceeding pre-negotiated third party service provider rates.
Where the employee is requesting reimbursement of an expense which is not specifically identified in the NJC Relocation Directive, but is reasonable, directly attributable to the relocation, and is supported by original receipts, reimbursement using the Personalized Fund is permitted.
Q14. How is the transfer allowance calculated?
A14. The transfer allowance is equivalent to two weeks base salary based on the rate of pay applicable on the date of appointment at the new location, excluding allowances and bonuses. If this appointment occurs either during a retroactive pay period or while the employee occupies an acting position, the transfer allowance shall be calculated based on the revised rate of pay.
Q15. When must I make the final decision on whether to sell my principal residence at origin or take the Real Estate Commission Savings in lieu of sale benefits?
A15. An employee who wishes to receive the savings for not selling their home must exercise this option within fifteen working days from the receipt of the appraisal report from the appraiser. It is the employee’s responsibility to maintain contact with the CRSP in order to inform the CRSP of this decision.
Q16. The Directive says that I may be authorized a house hunting trip of up to 5 days, in addition to 2 travel days. Does that mean my employer can offer me less than the 5 + 2 days that the Directive provides to travel to and find a residence at destination?
A16. No, it simply means that you don’t have to spend the full period at destination if you are successful in finding a new principal residence before using the full five days. Your employer should always allow you to take the normal duration of two travel days and five days at destination if you need that time.
Q17. My point of origin and destination are within reasonable commuting distance and I wish to travel back and forth on my House Hunting Trip (HHT). What expenses are reimbursable?
A17. When a commuting, rather than a conventional HHT, is pre-approved, and provided that the employee does not stay overnight at the destination location, the following may be reimbursed:
- Meals and incidental allowances (up to 5 days; employee and/or spouse or common-law partner from the Core Fund, children and/or dependants from Custom/Personalized Funds, see section 4.11)
- Return mileage (up to 5 trips, see section 4.12)
- Local mileage (up to 5 days, see section 4.13)
Q18. I would prefer to bring my children on my House Hunting Trip (HHT), but it would be difficult to find immediate childcare at an unfamiliar location. Am I eligible to claim travel-related expenses for my childcare provider to accompany us on the HHT?
A18. No. It is not the intent of the NJC Relocation Directive to reimburse travel expenses for a childcare provider. The employee has the option of leaving the children at origin and claiming for actual childcare expenses, or bringing the children on their HHT and claiming childcare expenses at destination.
Q19. I find the provisions on temporary dual residency assistance and interim accommodations, meals and miscellaneous allowance confusing. What’s the difference between them and how do I know which one I should be on?
A19. There is often some confusion between these two benefits because they reimburse some of the same types of expenses. Let’s start with interim accommodations, meals and miscellaneous allowance (IAM&MA). This is intended to reimburse employees their basic living expenses when they are necessarily separated from their household goods and effects. Typically you will receive up to three days while your house is being packed up, up to another two days while you’re moving into your new home and then up to 15 days while you are waiting for your furniture to arrive or the date you can move into your new home. In exceptional circumstances, your DNC may approve another 15 days. IAM&MA is capped at a maximum of 30 days for most moves.
The exception to this rule is when you are already at the duty location when you are authorized to relocate, or when your department decides to relocate you on very short notice (less than 30 days). In both instances the Directive recognizes that it may be very difficult to make arrangements to dispose of your residence at origin and find a new one at destination, so it permits up to 60 days of IAM&MA to help cover your costs. Keep in mind that 60 days plus the three days before the move and the two days after to unload and unpack is the maximum that may be granted, in other words you cannot add either of the 15 day periods mentioned above to the overall maximum 60 days.
In either of the aforementioned situations, your benefits will switch to temporary dual residency assistance (TDRA) as soon as your home is listed or your household goods and effects are loaded. TDRA is exactly what its name implies. It is designed to help defray some of the expenses you may incur if you end up maintaining two residences and provides assistance for a much longer period than IAM&MA. TDRA may provide you with assistance for up to six months from the core fund provided you meet the conditions outlined in Part VIII of the Directive.
Q20. The NJC Relocation Directive stipulates that business class upgrade is not authorized for travel within Canada from either the Core or Personalized Funds. Should I not retain the right to use the Personalized Fund as I please?
A20. The intent of the Personalized Fund is to reimburse actual, reasonable and justifiable expenses to the relocating employee that are attributable to the relocation. As business class upgrades within Canada are not deemed to be reasonable and justifiable expenses, it is confirmed that such expense cannot be claimed from the Personalized Fund. Monies in the Personalized Fund are deemed public funds until they are paid out as a taxable benefit whereupon they are deemed the employee’s money.
Q21. I have a special needs child who requires constant medical care. May I be reimbursed for expenses relating to a medical care attendant required to travel with us during our final move travel?
A21. With approval of the Departmental National Coordinator, the benefit, including round trip travel (transportation, meals, miscellaneous allowances and accommodations) can be reimbursed using available Core Customized Funds.
Q22. I see that there is a new Home Equity Assistance provision in the Directive. How does it work? What happened to the old Home Sale Assistance benefit?
A22. The new Home Equity Assistance benefit is designed to help employees who are selling their home for less than they paid for it. It is calculated by comparing the purchase price paid for the home to the sale price of the home and reimbursing employees 80% of the difference up to $15K when the result is negative. For example, if you bought your home for $400K and sold it for $388K you would be reimbursed $9,600 from the core fund (400,000 - 388,000 = 12,000 X 0.8 = $9,600). The old Home Sale Assistance benefit has been discontinued as it did not prove to be an effective tool.
Q23. I’m about to list my house and I understand that I am expected to have it actively marketed. What do you mean by “the listing price is consistent with the suggested list price in the appraisal”?
A23. The appraisal conducted at the beginning of the relocation process is intended to give you an objective assessment of what your house is likely to sell for within a given period of time in the market where it is located. For your house to be considered “actively marketed” you are expected to have it listed at a price that is reasonably consistent with the appraised value of the home. The advice you receive from your realtor will help you determine what the initial list price should be and when to adjust it if your home doesn’t sell immediately. You are expected to have it listed at a price that would reasonably be expected to achieve a sale. There is also an expectation that if the house does not attract much interest at the current list price that you will adjust the list price to generate interest in the property.
Q24. My service provider has charged more than the pre-negotiated rate allowable under the NJC Relocation Directive, but assures me that I will receive a $100 rebate. What should I do in this situation?
A24. As the Government of Canada pays the fees charged for the Third Party Service Provider’s (TPSP) services, any rebate forthcoming must be turned over to the department. Under no circumstances should any relocating employee be accepting a rebate cheque for services paid for by the Government of Canada as this would constitute an unethical practice. Furthermore, only the net cost of the actual fee charges shall be claimed for reimbursement. This net fee will be capped at the pre-negotiated fee established with the TPSP.
Q25. Under what circumstances may I claim mortgage-breaking penalty fees from the Personalized Fund? Is reimbursement dependent upon the portability factor of my mortgage?
A25. When the mortgage-breaking penalty exceeds the NJC Relocation Directive’s limitation of three month’s interest or $5,000 whichever is lesser, expenses beyond this limitation can be claimed from the Personalized Fund.
When an employee originally rents at destination and subsequently purchases within the one-year time frame, any mortgage penalty paid from the Core Fund will revert to the Personalized Fund, if portability was an option when the principal residence at origin was sold.
As it relates to a new home construction at destination, employees will be reimbursed their mortgage-breaking penalty from the Personalized Fund, if portability would have been an option had the employee purchased a resale upon relocation.
When the financial institution identifies that the mortgage at origin is portable upon meeting certain conditions, it is incumbent on the employee to ensure that these conditions are met. Where the conditions are not fulfilled, and the mortgage is not ported, total reimbursement will be available from the Personalized Fund.
Reimbursement will be based on the employee providing documentation from their financial institution confirming the portion of mortgage-breaking penalties that do not include the following:
- Consolidation of credit cards
- Financing of Personal/Private Motor Vehicles
- Refunding of original mortgage incentive
- Home equity lines of credit
As it relates to the refinance of a mortgage, it is not the intent of the NJC Relocation Directive to reimburse increases in mortgage breaking penalties, to employees who refinance their mortgage after receiving their relocation notification. Employees purchasing at the new location who subsequently decide to refinance the mortgage on their unsold principal residence to access their equity, can claim the additional mortgage breaking penalty from the Personalized Fund.
Q26. When selling my home in the province of Quebec, additional mortgage discharge fees were imposed upon me because the purchaser’s notary refused to provide the vendors’ mortgage discharge/acquittance for the established tariff. Are these additional fees reimbursable under NJC Relocation Directive?
A26. Under the NJC Relocation Directive, the Contracted Relocation Service Provider reimburses relocated employees for actual fees incurred to complete the sale of the property and/or to complete the purchase of a property as per the established legal fee schedule. In the province of Quebec, the purchaser’s notary handles the sale transaction and therefore, there are no fees on the sale transaction. There are, however, fees and disbursements payable by the vendor to the purchaser’s notary for the discharge of a mortgage (referred to as the acquittance of the mortgage in Quebec). The Quebec Civil Code indicates it is the responsibility of the purchaser's notary to perform the acquittance of the vendors' mortgage and only with their permission can it be done by another notary. In most cases, the vendor is obligated to use the purchaser's choice of notary.
It is the intent of the NJC Relocation Directive that when the purchaser's notary refuses to provide the vendors' mortgage discharge/acquittance for the established tariff, that the additional mortgage discharge fees in relation to the sale can be reimbursed from the Core Fund.
Q27. Article 8.13.1, of the NJC Relocation Directive outlines the reimbursement of Temporary Dual Residence Assistance (TDRA) expenses if the employee moves the household goods and effects (HG&E) and family. However, my realtor recommended leaving the furniture in the home as it will facilitate the sale by remaining attractive to potential buyers. If I leave the HG&E in my home, will that affect the reimbursement of my TDRA expenses?
A27. TDRA may be reimbursed as per subsection 8.13.1 of the NJC Relocation Directive when HG&E remain in the principal residence at origin, as long as the property is actively and competitively marketed for sale, is not rented to tenants for any period, and when all other conditions outlined in this article are met.
However, when the employee has no dependants, benefits under 8.13.1 shall be applied only after the HG&E have been shipped to destination.
Q28. As per sections 7.9 and 8.14 of the NJC Relocation Directive, when meeting certain conditions, employees may claim for weekend travel home expenses. Is there any flexibility surrounding this benefit such as traveling mid-week rather than the weekend?
A28. Weekend travel home expenses are limited to transportation costs. Transportation costs may include commercial carrier, personal/private motor vehicle, taxi, tolls and car rental. There is no meal or incidental allowances while conducting a trip and for the duration of a weekend travel home.
Weekend travel home benefits are also extended to employees (separated from their dependants) who receive a short notice transfer or who are already in function at destination where travel status ceases upon transfer notification, and who are approved to receive Interim Accommodation, Meals and Miscellaneous Relocation Allowance benefits in accordance with section 5.6. The rationale is that they were unable to effect the movement of household goods and effects due to the short notice.
As it relates to specific days, it is understood that an employee’s schedule may provide them with the opportunity to travel home during mid-week versus during the weekends. It is confirmed that as long as the department approves leave, the employee that qualifies for weekend travel home has the flexibility of traveling mid-week.
The intent of the NJC Relocation Directive is to provide employees an opportunity to travel home and reunite with their family and is not limited to a two-day return trip from Friday to Sunday. In addition, the travel may be scheduled to coincide with a statutory holiday (as long as the other constraints of this entitlement are respected).
This does not qualify for travel to inspect the unsold property or to return home to effect the shipment of household goods and effects.
Q29. The NJC Relocation Directive states that employees are eligible for professional cleaning of the former and new residences. What types of cleaning are covered?
A29. The professional cleaning provision in the NJC Relocation Directive is intended to reimburse cleaning of the former residence after the household goods and effects have been loaded, and at the new residence before or after the unloading of furniture (within a reasonable delay).
The benefit does not include the rental or purchase of professional equipment. It also does not extend to cleaning, which would otherwise be considered regular maintenance of the home (including, but not limited to, the cleaning of: furnace/ducts, chimney, gutters/eaves-troughs, windows, pool/spa, etc.).
Q30. It is understood that the Mortgage Default Insurance (MDI) premium can be reimbursed when the premium is levied in one payment. Is it still reimbursable if the MDI premium is incorporated into my mortgage?
A30. Mortgage default insurance can be claimed, regardless if the payment is made in one lump sum or incorporated into the mortgage. When claimed, reimbursement is made in one payment, as if paid in one lump sum.
Q31. The NJC Relocation Directive identifies that the Mortgage Default Insurance (MDI) premium may be reimbursed when a homeowner transfers all or part of their equity to the new residence. I am a renter, and therefore, have no equity to transfer. Does this benefit also apply to my situation?
A31. When the employee is a renter at origin, and therefore has no equity to transfer to a new home purchase, it is confirmed that they are entitled to claim 100% of the MDI premium from the Core Customized Fund. Reimbursement is subject to the availability of funds.
Q32. The NJC Relocation Directive allows for the reimbursement of interest on a short-term personal loan when required to place a deposit for the purchase of a principal residence. Does this benefit also apply when purchasing a new home construction where the deposit required is significantly higher?
A32. Interest reimbursed on a short-term personal loan, as it relates to a new construction, shall not exceed the amount of the loan necessary to confirm a commitment to purchase a resale residence of similar value. Progressive advances paid to the builder as part of the purchase agreement do not meet the definition of deposit and as such, interest on such a loan cannot be reimbursed from the Core Customized Fund.
Q33. In article 11.5 it says that I can be reimbursed my expenses for local licenses for the minimum period required by law. What does that mean?
A33. Different provinces have different rules when it comes to obtaining local licenses. This provision simply says that you will be reimbursed for the minimum period that you can obtain the license. For example, in Ontario you have the option to pay for your license plates for either one or two years. If you opt for two years you will only be reimbursed for the first year as that is the minimum requirement.
Q34. Have there been any changes to Employee Requested Relocation?
A34. The intent of employee requested relocation is the recognition that there may be circumstances in an employee’s life that may lead them to request a move to a new location. employee requested relocation may be approved on personal and compassionate grounds as long as there is a vacant position at the same group and level at the new location.
With that said, there are three changes with respect to employee requested relocation:
- there is no longer a requirement that the Deputy Head certify that the position at the new location would otherwise have been filled through normal staffing without relocation expenses having been incurred;
- the deputy head or delegated departmental authority must, in writing, certify that the approval for the relocation is based on these personal or compassionate grounds and the employee must accept, in writing, that the benefits are limited to those outlined for this purpose;
- the employee is no longer required to use government approved movers. The employee may arrange for their own movers. This cost shall be paid out of the Core Customized Fund and is limited to the amount in that fund. Costs in excess of the Core Customized Fund shall not be reimbursed.
Q35. If my assignment is extended past three years, or turns into a permanent job offer, will I then become eligible for the Sale of Home (Part VIII) and Purchase of Replacement Residence (Part IX) provisions of the Directive?
A35. No. Your principle residence, as defined under the Directive, changed to the new location when you relocated to your new place of duty at the start of your assignment. You are considered to have already moved and relocated to the new workplace, so no further benefits would be provided. For this reason, both employees and departments should exercise caution and ensure they are fully aware of exactly what their entitlements and obligations are before deciding to relocate.
Enquiries
Requests for more information or clarification should be addressed to your designated departmental coordinators.