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Company Travel Policies


What is a Company Travel Policy?

As travel is an integral part of conducting business, employees are hired with the expectancy that they are prepared to travel in agreement with the Company Travel Policy Guidelines and deliver supporting documentation to the appropriate department.

A well-made policy manages travel expenses each year for the company. Its purpose is to decrease excessive spending and increase company saving. It prevents travel budgets from rising and getting out of control by recording the cost of business travel and entertainment.

It is the employee’s responsibility to use sensible judgment when approving the use of company funds. The company travel policy is put in place to protect employees when they travel, shrink business travel expense and limits potential legal liabilities. In addition, it ensures that employees are getting reimbursed for their out-of-pocket travel costs.


Company travel policies should be well-written standards in the employee handbook that specifies what kinds of expenses the company reimburses and how the employee must claim expenses. Normally, expense policies also contain a section on the penalties of violating the policy.

A written travel expense policy gives the employee a well-defined explanation of the reimbursement policy for travel expenses to avoid any confusion. It provides sensible accommodations for the employee while decreasing the expenditure to the company for reasonable business and entertainment necessities.

An employee travel expense policy requires all employees to provide written documentation of their expenses to ensure easier reimbursements approval and filing of paperwork. The policy ought to include overnight trips as well as mileage expenses for business related travels.

The travel expense reimbursement policy should include details about what will be covered and how much will be covered for each kind of expenses. Employees should understand travel policies before embarking on any company travel at their own initial expense to be reimbursed later.

How to Write a Company Travel Policy

A well-conceived company travel policy protects your employees when they travel, cuts company travel expenditures and limits legal liabilities.

1. Requests for Traveling

A travel policy should guide an employee with a description of the procedure they must follow to get trip approval. It is the appropriate supervisor’s responsibility to approve each trip.

If an employee has attended conferences from past years, that doesn’t mean they get a one-time approval for every year. The purpose and necessity of the business trip, the department to which the trip will be charged, an estimated total cost and the dates should be included in the written outline needed for the employee’s trip approval.

Do not forget to include the superior employee who is in charge of approving travels for employees!

2. Give Clear Preferences

Don’t just assume employees will book cost-conscious flights or hotel rooms. There is usually an expectation that employees will remain within the budgeted cost. That’s not always the case. The appropriate department should approve bookings flights and hotel rooms beforehand.

Employees may be able to book flights or hotels that offer frequent flyer miles or room points, rather than choosing the most cost-effective for the company. If the company permits employees to keep frequent flyer and room points, the proper department should reserve or approve all reservations to acquire the best rates for the company. If the company uses the frequent flyer or hotel points to cover travel expenses, this should be included in the company travel policy.

3. Explain Expenditures

Keep the policy simple with helpful guidelines to explain what employees can and cannot claim on expenses. This section should outline acceptable and in-policy travel related expenses. Establish daily per diems that cover food, tips, transportation, parking, phone calls and other incidentals. Make note that not all expenses require a receipt for reimbursement. Be sure to outline which expenses will require one. Some companies may allow credit card statements as sufficient documentation. To avoid confusion, specify what kind of reimbursement documentation is required. Some companies request receipts instead of credit card statements.

4. Incorporate Safety Procedures

In an event of an emergency, employees need to include the name and phone number of the hotel at which they will stay and a personal phone number. Companies should have a detailed itinerary of their employee’s travel, hotel, and business schedule. At the time of travel, employees should remain in communication with their supervisors, even during after-hours. Overseas traveling provisions should be outlined asking employees to provide proof of a valid passport, additional government ID and the phone number and address of the U.S. embassy in that country.

5. Include Expense Reimbursement Procedures

Employees should be given a reimbursement form to file when they arrive from their trip. Offer a sample copy with notes on any section you want to highlight. The procedure for submitting an expense reimbursement request should be visibly clarified.

The form, any receipts, and the name of the supervisor that the request must be submitted and the deadline for submitting requests may be included. It is a wise practice to keep a daily log of expenditures to ensure that the employee will be guaranteed reimbursement given that they are in compliance with the company’s travel policy.


Why is a Company Travel Policy Important?

Company travel policies are imperative to improve company compliance to travel policy. The travel policies are agreements within the business to limit over expenditures of the costs of sending employees on work trips. Companies encounter challenges when employees overlook the company’s travel policies. Sometimes their unawareness of the policy can be in part of trying to find the lowest rates without understanding the travel program’s structure and savings negotiations. They may think the policies are just guidelines that are not mandated. Or they just don’t fully understand about the company’s policies. This type of unawareness limits prospective savings.

To ensure company compliance and increase savings, all employees should get the same standards. This means that the CEO should follow suit alongside everyone else. Just because they earn more, this doesn’t mean they should book a first-class plane ticket when everyone else has to fly economy. Having a policy in place should eliminate employee resentment towards the higher up managers.

Another important thing to incorporate is a list of satisfactory and permitted travel agents and hotel chains in the policy. This eliminates added decision making for employees when they are organizing their business travel. Having a key group of trustworthy agents and hotels that the company uses regularly will eliminate potential budget wasting costs.

Managers should keep employee comfort in mind when approving travel accommodations. They should choose a hotel that is sanitary, comfortable, and livable. When a company policy offers accommodating choices for the employee, this can increase an employee’s productivity and trust for the company.

Balance is the key concerning travel costs and a perceived business advantage. A well thought out travel policy will work to boost costs in a number of ways.

Outlining services that are reasonable is clearly the first choice. Having choice words in the details could save the company a lot of money. For example, the company should state employees should book a single occupancy hotel room instead of stating they should book a suite hotel room.

A travel policy means that the company puts limits and standards on the type of services reserved by company employees. The policy safeguards that there is no confusion over the way to spend company money. It offers reimbursement policies and procedures to protect company costs and avoid legal liabilities as well as treating the employee fairly in regards to travel expenditures and refunds.

Data is knowledge

When a company can clearly see how and when employees are booking travel then analyze that data, this understanding can indicate where to implement cost reduction strategies. Companies that utilize a well-managed travel program have better knowledge when it comes to considering revenue and costs.

Even if the cost of traveling increases and the company revenue is not sufficient to accommodate that, what decisions do the companies have to make regarding how often employees travel for business? What do they have to do in order to ensure the company is keeping up with their clients and business practices?

Company travel policies can provide businesses with collected data that can be used to benchmark the company’s spending habits. It is a great tool to analyze company performance, by a competitor or against an industry. The information can be used to identify gaps in the company’s processes in order to save money.