Company Travel Policy: The Complete Guide + A Free Template
Traveling on business has become the norm in our busy, work-oriented society, and so is a company travel policy with this trend.
Despite all the technological advancements, getting a chance to talk to clients face to face or pitch a business project in person still beats sometimes messy communications apps.
Since travel is neither cheap nor easy, it's best to set clear expectations and rules ahead of time. A company travel policy will outline the procedures for employees on company-paid trips to avoid any issues that might arise in the process.
Our comprehensive guide to company travel policies will give you an idea about the kind of information and provisions the Policy should include.
We'll also provide you with a free template that you can use to quickly deploy a company travel policy of your own.
What Is Travel Policy?
A company travel policy, also known as a corporate travel policy, is an internal document that outlines how business-related expenses are handled within the company.
It covers everything from defining what a business-related expense is and isn't to how to remain safe if traveling alone and everything in between. Most importantly, it makes it clear who's in charge of approving expenses and reimbursements and who takes care of the actual booking.
Among other things, a travel policy can include:
- Booking responsibilities and the choice of company-approved travel agencies
- Total budget (lodging, travel, daily meals, etc.)
- Company-paid and out-of-pocket expenses
- The approval process and the person in charge of it
- The approval of reimbursements
- Preferred company vendors and partners
- Travel debriefing process
- Travel insurance carrier
- Exceptions to rules for any reason
As you can see, a travel policy is about much more than just saying whether an employee can fly business or not. Instead, a corporate travel policy is about foreseeing all the situations that can arise from business trips and staying on top of them.
Why Do Companies Need a Travel Policy?
Streamlining processes saves companies a lot of time and money in the long run. Be it onboarding new employees, paying out bonuses, or organizing business trips, having a system in place will make the process more efficient and reliable.
More importantly, rules and policies protect both parties from unexpected events and expenses that could arise from misunderstandings.
A travel policy will help employees manage both business and personal expenses more reliably while also giving them the freedom to book and organize trips how they please.
When employees have strict guidelines, they'll always know what's coming out of their pocket and what expenses the company will incur.
On the other hand, companies will reduce unnecessary overheads by making it clear what is reimbursable and what isn't. An employee on a business trip with a business card in their wallet can quickly lose sight of the purchases they're making. Your Policy should clearly say what the limit to such expenditures is and draw a line.
A company travel policy will also contribute to fairness and positive company culture as there will be the same set of rules that applies to everyone.
Approving and reimbursing expenses won't be left to the whims of individuals — instead, everyone will abide by the same guidelines.
Another important point needs to be clarified when we're talking about company travel policy. What exactly falls under the category of business travel? We'll address that issue in the section below.
What Counts as Traveling on Business?
Any international or domestic journey that the employee undertakes for the company constitutes traveling on business.
In some cases, companies might try and define what a business trip is depending on the distance that the employee has to travel, but in essence, it should all fall under traveling on business.
It shouldn't matter whether a company is reimbursing its employee for just a bit of gas or a transoceanic flight — if the employee was traveling at the company's behest, all their expenses should be covered.
Of course, this goes only for the expenses mentioned in a company travel policy, which is yet another reason to have such a document in the first place.
How Do You Write a Business Travel Policy?
Now that we've gotten the "what" and "why" out of the way, it's time to address a frequent question: how do you write a business travel policy?
Writing any Policy can feel daunting since there is a lot to cover and keep in mind. We'll help you write an effective travel policy, step by step. First and most importantly - let's see what you need to include in this document.
What Should Be Included in a Travel Policy?
When you want to create a company travel policy for employees, it's important to include information they really need. For example, reimbursement is vital for your team, so it should be properly addressed.
Your employees need to understand what they can get reimbursed for and how to claim those expenses. The reimbursement procedure must be a part of a comprehensive corporate travel policy.
And, of course, safety is a crucial component of travel policy for companies. You want this document to have value for your team and to add a layer of protection, so it needs to include travel insurance and emergency procedures too. This is especially important nowadays, given the fact that both Coronavirus and Monkeypox are circulating the globe.
The list below will give you an idea of the basics that are usually included in the company travel policy for employees:
- The introductory part that explains what will the travel policy cover and why it is important for the employees
- The travel booking procedure and business travel booking tool - are both approved by you. This section should also contain exact timeframes for booking and approvals
- Expense categories include details on what's reimbursable in each one. Your Policy should clearly state whether items like meal expenses are included.
- Non-reimbursable purchases. This part of the travel policy is important, as it cites what isn't covered and therefore must be paid by the employee if they want it.
- Expense reports and reimbursement requests - how to submit them
- Travel support and emergency procedures, including travel insurance and duty of care vendors
These are the essential elements that are usually listed in a corporate travel policy. Still, you are free to expand it or tailor it in any other way, so it suits your business needs.
Pro tip: Before you make your corporate travel policy official, reach out to one or more frequent travelers for feedback. They'll be able to fill any gaps and assess whether it's clear and to the point.
Avoid Common Company Travel Policy Mistakes
The most frequent mistake companies make when creating their travel policies is making the document too challenging to understand. This means that the Policy is either too loosely and unprofessionally written or that it's too strict and bureaucratic.
Both of these extremes make understanding travel policies unlikely.
Give your policy structure and decide on a tone of voice you'd like to use throughout the document. Then, try to be as consistent as you possibly can. The tone can be serious and official, but it doesn't have to be robotic. If your employees need a lawyer to make heads or tails of your Policy, you haven't done a good job.
Another common mistake is not using technology to your full advantage. Tracking mileage, employee expenses, and their location and then aggregating that data can help you manage travel budgets accordingly. Without tech-based solutions, you'll have to record every receipt and every tiny detail of the employee's trip. It's time-consuming, ineffective, and annoying at best.
Read our article on the best GPS employee tracker apps and find out which solution is right for your business.
Get Your Free Company Travel Policy Template Now
Now that you've learned how to create an effective and comprehensive corporate travel policy, we'll provide you with more guidance on the matter: a sample company travel policy for employees in a PDF format. You can download and print it or use it as a foundation for your internal document.
