How To Draft A Corporate Travel Policy That Fits Your Business? (+ Free Template)
Your travel policy lays the foundation for your company’s entire travel management process. And if you have employees traveling for better business outcomes, especially during these times, you must build a travel policy that balances business outcomes on mobility and cost, and yet enables procedures to keep employees safe.
This article will walk you through the best practices of drafting and implementing a clear and concise travel policy, along with a customizable template for your use.
Key Sections Of An Effective Corporate Travel Policy (That Employees Really Follow)
A corporate travel policy should include a list of guidelines and rules for the travel your employees undertake. The policy should be concise and specific so that employees do not get confused or feel bored while referring to it. While there is no one approach for creating a travel policy, we believe the best travel policy document should cover the following:
Section A: Objective
A smart corporate travel policy should always include an objective. Why? It should make it clear who the policy is for and the goals you want to achieve by revising or formulating it. For instance, is your top priority to control travel costs, offer more flexibility to employees when they travel, or increase policy compliance? We recommend that the policy objectives are defined as bullet points. Don’t forget to include benefits for employees that the company seeks to deliver.
Section B: Booking Process
This section should include everything your employees would need to know about where, how, and when to book travel. You’ll likely want to start with a statement encouraging employees to book responsibly and affordably, (if they are allowed to book themselves).
- Separate booking guidelines for domestic and international travel – There should be different sections for displaying domestic and international travel booking guidelines. It should define what employees need to take care of while booking domestic or international travel respectively.
- How to book a trip – You should include the approved process for booking business travel through a T&E platform or a travel agent. If your company has implemented a T&E solution, provide the link of the platform so they are redirected to the platform for booking. Otherwise, write out the name and contact details of the travel manager they are supposed to contact to request a booking or for travel details.
- Latest booking period – You should also include the latest booking period for employees to organize everything well before time. Eg: at least 10 days before the trip. The booking period shall be different for domestic and international travel. Encourage employees to avoid last-minute bookings as it increases the cost of travel dramatically, providing only a few options to choose from.
- Policy around flight cancellations, missed flights & rebooking – Clearly state if there will be any extra charges for rebooking the flights, etc. Most airlines today provide flexible booking policies. You can provide a link to the cancellation policy of respective airlines for better clarity.
- Rewards for cost-conscious employees – Let your employees know if your company’s T&E management tool provides rewards or loyalty points for cost-conscious employees. You can simply add a line “Employees may choose hotel/flight below their policy limit only to get rewards.”
- Guidelines regarding Bleisure – Sometimes, employees may want to extend their business trips or use some of their vacation days. The travel policy should provide rules around what cost difference is allowable for the returning flight or extended hotel stay.
Section C: Expense Categories
This is the most important section of any travel policy. It should include information regarding all expense categories such as flights, accommodation, ground transportation, meals, client entertainment expenses, and telephone usage. Here’s the information that you can include under each category:
- Indicate under which circumstances an employee can book business class vs economy; if it is only allowed after a certain seniority level
- State the flight booking cost limit grade-wise for domestic and international travel
- State if employees can keep their flyer points or if the company retains them for discounts
- Preferred vendors/airlines (if any)
- State if the company will reimburse in-flight merchandise purchases or not
- Provide employees maximum room rate per day as per their policy limits, in popular company destinations
- Specify room type. For instance, only standard room allowed; upgrades allowed at no extra cost
- Clearly state the rules for booking stay via Airbnb or personal studio apartment
- Ground Transportation
- Indicate if your company allows employees to use apps such as Uber and Lyft; specify if they should use it or not if there is surge pricing; type of car allowed- compact or midsize
- Specify the amount that will be reimbursable per mile or kilometer; maximum reimbursable amount per day
- Specify if receipts are mandatory or not
- Encourage employees to use public transportation when convenient
- Share reimbursable expenses for breakfast, lunch and, dinner individually
- Alternatively, share per diem rates or a daily maximum
- Indicate if the company would reimburse for alcohol
- Set rules for team meals
- State clearly if the company would consider tips as a reimbursable expense or not
- Client entertainment
- Specify what would be considered as client entertainment and would be a reimbursable expense
- Set spending limits
- Telephone usage
- State if the phone bill amount is reimbursable or not; if it is, then specify the maximum limit
- Whether personal phone damages or thefts would be covered as a reimbursable expense by the company
Section D: Non-reimbursables
Share in detail with all employees travel expenses that your company would NOT reimburse. Create a list with some examples of non-reimbursable items such as:
- Extra baggage fee
- In-flight purchases
- Alcohol consumption
- Tips to hotel staff
- Minibar purchases
- Parking fines or traffic violations
- Additional bed/bedding
- Pet Boarding
You may have covered some of the items in the expense categories section but it’s useful to have an entire list like this available for the convenience of the employees.
Section E: Expense reporting and reimbursement process
This section clearly defines the expense reporting and reimbursement process. Your policy should clearly state the following:
- The minimum amount that would require a receipt/document
- If you would accept credit card statements as proof of expense or not. (Ideally, you should not as the credit card statements would show the entire amount of the lodging which could include a non-reimbursable expense such as minibar or alcohol purchases)
- The timeline for submitting reimbursements post-trip
- Tool via which expense reports should be submitted
- The approval flow i.e. to whom they should be submitted for approval
- How soon can they expect the reimbursement
- What will happen in case of exceptions i.e. if someone has booked lodging out-of-policy, etc.
Section F: Travel support & safety information
An important goal of your travel policy should be to spread awareness about your company’s steps for ensuring travelers’ safety. It’s much needed in the current times and your employees would interested in knowing about it. So, include information regarding travel support, travel insurance, emergency contact numbers, etc. A few of your pointers could include information on:
- Tracking employees – Include how booking via the company’s T&E management solution can help them be tracked. For instance, with a T&E partner like ITILITE, you know exactly what flights, hotels, and cabs are booked – and where an employee is at any given time.
- 24*7 multi-level support – Include contact details of the travel support provider. Let them know that the support is available through easily accessible modes like chat and calls. Make sure you highlight the emergency contact details of your travel partner or an SOS helpline number in case of untoward incidents
- Travel Insurance policy details – List the details of the travel insurance you are providing to your employees (if any) i.e. the vendor, insurance amount, policy, etc.
Best Practices For Drafting A Corporate Travel Policy
- Focus on Employees’ Needs – A travel policy should be built keeping travelers in mind. Employees should not struggle to know which hotel they can book or not. Showing them what’s in and out of policy while they are booking the tickets will enhance their experience.
- Keep it simple – Your travel policy should be easy to understand and include the information most pertinent to employees. If the policy is clear & easy to understand, employees will comply with it. If not, they might end up booking out of policy. You can also include a glossary section if your travel policy includes complex terms.
- Create a flexible one – The travel policy should be flexible so that your employees cancel/reschedule their travel easily. Your policy should also make it simple for travelers to overspend if there are safety concerns. While this may partly increase costs for the company, it will give you and your employees peace of mind.
- Encourage and incorporate employee feedback – Your employees should have a say in your travel policy. Gather feedback from survey post trips, and include the most valid points in the policy. Making all stakeholders and employees a part of policy creation will increase adoption as well.
- Include your duty of care plan in the travel policy – The duty of care plan includes the steps you take to minimize risks while sending employees on business trips. You should highlight your duty of care plan in the travel and support section so the employees know all the initiatives – tracking of employees, 24*& support, SOS helpline – the company is taking steps to ensure their safe travel.
Implementation Is The Key
Now that you know how to create an effective corporate travel policy for your business, make sure you implement it via an automated T&E management solution that gives your employees a great user experience so compliance follows naturally.
ITILITE is a modern integrated travel and expense management platform that will help you implement your travel policy seamlessly, with unrivaled inventory choice and 24*7 customer support. To know how you can ensure 100% policy compliance & save travel costs with the ITILITE T&E management solution, book a free demo with our product expert today!
Your Customizable Corporate Travel Policy Template (Downloadable)
Having a clear corporate travel policy will help you keep your employees happy & safe, and save money for the company. We created a template that will help you do just that. With this FREE template, you can streamline your travel process and help your organization stay on track.