Administrative Policies and Procedures Manual - Policy 4020: New Employee Relocation Allowance

Date Originally Issued: 03-01-1991
Revised: 05-19-1995, 07-01-2004, 07-01-2005, 05-22-2006, 02-01-2013, 06-14-2013, 12-01-2016, 12-05-2018, 04-14-2023, 12-11-2023

Authorized by RPM 7.4 ("Purchasing")

Process Owner: University Controller

1. General

The University recognizes that payment for some of the costs of new employees relocating to the University of New Mexico may be an important consideration in the recruitment process. Thus, hiring officers may negotiate a relocation allowance for certain new employees. Relocation allowances may be paid when it is in UNM's interest and benefits the recruitment effort, when funds are available, and when approved in writing by the person who has the budget authority to release funds for such purpose. This may be the President, a vice president, a dean, a director, or a department head, or hiring officer. Relocation allowances are intended to cover house-hunting costs, packing and transporting household goods, furnishings, and personal effects of the employee and members of the employee’s household, and transportation and lodging for the employee and members of the employee’s household while moving. PCard purchases are only permissible for expenses related to the recruitment of candidates, consistent with UAP 4040 (“Employee Recruitment Expenses”). Departments may not use a PCard to pay for any employee relocation expenses or to reimburse new employees for expenses incurred after acceptance of an offer letter. Employee relocation expenses are only permitted through relocation allowance or contracted directly through a moving company, per this policy.   

2. Eligible Employees

2.1. This policy pertains to new, full-time employees, including staff; non-temporary faculty; and post-doctoral fellows.  This policy also applies to faculty members hired into positions that are less than 1.00 FTE but not less than 0.50 FTE.

2.2. Any employees who fail to fulfill their contract or appointment obligations after receiving a relocation allowance will be required to repay a prorated portion of their allowance. A new employee failing to complete twelve (12) months of service at UNM unless specified otherwise in the contract from the employment start date, shall be assumed to have not fully met the appointment obligation.     

2.3. Relocation allowances will not be paid to new employees already living less than seventy-five (75) miles from the new employment location.

3. Payment

3.1. The hiring officer is responsible for informing the new employee of this policy. The relocation allowance must be processed by the department’s employment area within normal payroll deadlines. The relocation allowance, net of required taxes withheld, will be paid after the employee’s official start date and on the normal payroll cycle after all approvals are completed. 

3.2. The relocation allowance amount must be established in the offer letter. The hiring officer is responsible for identifying the source(s) of funds available to cover the negotiated amount. Amounts in excess of $15,000 must have prior written approval by the cognizant executive vice president or University President, as applicable.

3.3. To initiate a relocation allowance, the hiring officer will submit a Relocation Allowance/Invoice Request Form, located on the Payroll Website.

3.4. It is the department's responsibility to monitor the spending of the amount(s) for the employee’s allowance or payment to the moving carrier in section 4. If any issues arise, the department should contact Financial Services.

4. Payment of Moving Carrier Directly by UNM

4.1. The new employee may elect to have their moving carrier expenses paid directly by UNM.  To elect this option, the hiring officer will select it on the Relocation Allowance/Invoice Request Form, located on the Payroll Website. When this option is selected, the Purchasing Department will assist the new employee in making arrangements with UNM’s selected interstate carrier. The employee must work through UNM’s selected interstate carriers and obtain a quote. The employee will then forward the estimate from the agent(s) to the hiring officer. Upon receipt of the LoboMart requisition, the Purchasing Department will issue a Purchase Order for services. Invoices to the moving carrier will be paid by the University up to the amount agreed to in the offer letter.

4.2. The hiring officer may agree to pay the employee a relocation allowance in excess of the amount paid directly to the moving carrier. If this option is chosen, the hiring officer must submit a reduced relocation allowance request to the appropriate Employment Area, but the employee will not be paid the allowance until the moving carrier is paid in full by the University.

4.3. Amounts paid to the moving carrier will be reported as taxable income to the employee on the next payroll cycle after the employee’s start date.

5. Exceptions

5.1. In cases where the relocation allowances are being paid by a grant or contract and the provisions of the grant or contract place greater restrictions on the allowances for moving expenses than UNM policy as defined herein, such restrictions shall prevail.

5.2. Any exceptions to this policy that are not otherwise provided for must be approved, in advance and in writing, by the Executive Vice President for Finance and Administration, the Provost and Executive Vice President for Academic Affairs, or the Executive Vice President for UNM Health Sciences and Chief Executive Officer of the UNM Health System.

6. Tax Reporting

Beginning in 2018, all relocation allowances paid to or invoices paid on behalf of employees are 100% taxable per IRS requirements. The Employee’s year-end tax statement (Form W-2) will include the gross amounts and all applicable taxes withheld in the calendar year of the payment. This section is subject to change if federal requirements are modified in the future. UNM Payroll and Financial Services staff do not provide personal tax advice.