Travel has changed drastically in the last two years, as the pandemic shifted the way companies conduct business. From virtual meetings at home to the return to travel around the globe, businesses have had to rapidly adjust their travel expectations. Those that haven’t reevaluated their policies may find themselves struggling to keep up. As companies grow and evolve, and as the environment of work travel changes, so should your travel policy for employees.
Throughout this shifting work environment, travel rates and expenditures continue to rise—returning to nearly pre-pandemic levels. Responding to that shift may require adjustments in expense reporting policies. For example, many employees that once traveled by air now prefer to travel by car. A robust travel policy is capable of guiding each employee through these transitions, offering guidelines for employee travel and spending.
The travel policy should also define how organizations reimburse employees for reasonable expenses incurred while traveling. Regularly reviewing and updating this policy is essential to avoiding problems. A neglected or outdated policy can potentially lead to confusion, fraud, or unhappy employees. Spotting any of these three red flags can be a sign that your organization is due for a travel policy overhaul.
Problems with Outdated Travel Policies
1. Employee Confusion
As the state of travel is rapidly changing, it’s important that the most common scenarios are covered in a company’s travel policy and updated to reflect whatever those new scenarios may be. If the expense policy isn’t comprehensive or fails to answer employee questions, it can lead to frustration and mistakes, as well as time wasted in unclear communication.
2. Employees Discontentment
A travel policy for employees needs to be flexible enough to accommodate special cases. If employees aren’t happy with the travel guidelines, something may need to change. For example, while commuting miles are not typically deductible, they may be in certain cases, such as for traveling to a temporary work site or if an employee has a qualifying home office. Your travel policy needs to account for these special cases in order to ensure employees are receiving proper reimbursements.
In addition, as inflation increases, per diem rate caps may need to be reexamined. If the daily expense rate is capped too low, employees may have to spend their own money in order to fulfill their work duties. Ensuring employees are happy helps create a positive work environment that increases retention and respect for other company policies, as well.
3. Increase of Fraud & Out-of-Policy Expenses
While a policy needs to be flexible, it also needs to include clear, enforceable rules regarding travel expense reimbursements. An old policy may not be keeping up with new procedures and technologies, which can create gaps that employees could potentially exploit. Common travel expense schemes include submitting duplicate claims, exaggerating expense or falsifying amounts, claiming personal expenses as work-related and inflating mileage numbers. An updated expense policy can include more rigorous controls, review procedures and auditing standards to reduce the risk of fraud.
Updates that Will Help
Clarification
The first step is clarifying travel and expense guidelines for employees. Fraudulent activity is often the result of employee confusion and attempts to expense things that are not reimbursable. Clearly communicating your organization’s policy is essential to improving workflow. A document that summarizes what can be expensed and how to report expenses, as well as outlining each employee’s responsibility, can go a long way in the proactive management of your travel policy for employees. If you invest in a digital expense management system with robust controls, employees will be able to get clarification on expense reports right away. For instance, if they try to submit a duplicate expense report, it’ll be immediately flagged.
Real-Time Reporting
Rather than asking employees to collect receipts, write down mileage, and remember every expense to report back to the office, a digital system lets employees track their expenses in real-time. With receipt submission, reimbursement updates, and mileage tracking all available on a smartphone app, employees can more accurately track their expenses and focus on the work they are doing, rather than dealing with cumbersome reporting systems. Reporting expenses on the go also reduces the chance for inflated estimates and fraudulent claims.
Automated Management
With the back-and-forth between managers and employees, the need for multiple departments to review and sign off on documents and the potential for things to slip through the cracks, there is often a significant cost involved in managing travel expenses. Not only does this slow down the organization, it can also upset the employees who are waiting for reimbursements. An automated system makes it easier to analyze reports, track changes, review and approve expenses, and reimburse employees quickly. Automated systems can also be quickly adjusted to respond to changes in travel systems and policies.
Manage Travel Expenses with CompanyMileage
CompanyMileage helps organizations improve their travel policies with efficient expense tracking, report submission and automated review and approval. Our flagship software, SureMileage, utilizes a novel approach to mileage reimbursement. By finding the most direct route between the start and destination of each trip and calculating the mileage to be reimbursed, we help our customers simplify travel reimbursement and eliminate the issues commonly associated with manually recording odometer readings. When employees are out in the field, our mobile app, SureMobile, allows them to keep track of their trips and appointments, access their Address Books, submit expenses and more.
Once an expense has been submitted for reimbursement, our software automatically moves it through the approval workflow you’ve configured. Once everyone has had a chance to review and approve, a payment can be swiftly issued. SureMileage integrates with all major payroll and accounting systems, so there’s never a hang-up between reimbursement approval and payment.
We’ve seen firsthand how our expense management solution simplifies travel expenses, reduces fraudulent claims and leaves employees at all stages of the reimbursement process satisfied. If you’re ready to reimagine your travel policy for employees in a whole new way, request a demo with CompanyMileage today.