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Creating Corporate Travel Policies – Part 2

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Today we continue our mini-series for creating your very own policy manual for employees traveling for business. If you already have your own policy guide, you can check it against ours and refresh it as needed. There are many components related to travel policies and we don’t want to overwhelm you by covering all the details at once. Over the next few weeks, we will continue to share information about setting policy for expenses such as hotels, airfare, ground transportation. Your policy guide should include the steps needed for making reservations, being reimbursed, and spelling out expenses that are allowed or expressly prohibited.

Hotel Policy Guidelines

It is important to create policies that govern rules for booking hotels. This will include a section that covers lodging expenses. Your rules regarding hotel selection can be based upon star ratings, maximum cost per night, location in relation to the meeting or event location or even the airport. You can also specify that employees only book standard hotel rooms and avoid deluxe rooms or suites.

The next area of concern for overnight hotel stays is which incidentals your company is willing to reimburse. Some companies allow room service, dry cleaning services and valet parking where some do not. The choice is yours to make when setting policy. This eliminates any vagueness for your traveling employee and helps avoid unexpected financial surprises for either party.  If you choose to implement a policy that is based upon maximum room night charges, keep in mind that hotel rates are subject to seasonal fluctuations and some locations such as Miami or New York can be much higher than a place like Pass Christian, Mississippi.  For this reason, many companies partner with a travel management company such as Egencia to get better rates. In this case, the employee must stay at the Egencia referred property for the best value.

Purchasing Airline Tickets 

With respect to purchasing airline tickets, the class of ticket is going to be important to you and the traveling employee. Do you want the employee to purchase the least expensive seat and save money? Are you okay with spending a little more and allowing your employees to travel in Business Class? The rules regarding the seat selection are important to include. Your employee could surprise you with a First-Class ticket expense. There may be times when it’s okay to make Business Class bookings or perhaps your policy might dictate that it is never allowed under any circumstances. You might want to consider Business Class bookings only when a travel segment exceeds a certain amount of travel hours. More than six hours in coach can be tough on anyone. You might consider including an exception for last-minute travel, where economy class bookings may be unavailable on short notice.

About Frequent Flyer Miles

When employees travel, they can earn frequent flyer miles if they are enrolled in an airline’s frequent flyer program. There is currently no global corporate standard in place that governs whether the company or the employee keeps the frequent flyer miles. For this reason, it’s important to include a section that covers using business miles earned on company flights for personal use. While some companies recognize the employee is the one traveling and earning miles, other companies stipulate that frequent flyer miles belong to the company and are used to reduce the costs of future travel. Whatever you want your policy to be is up to you. Either way, make sure to include a policy that prohibits employees from using a more expensive airline simply because they are enrolled in a frequent flier program.