A guide to corporate travel policies
When business travel isn’t guided by a clear policy, employees are left unsure about what’s allowed, how to book, what expenses are covered, and who needs to approve their trips. This uncertainty leads to budget overruns, booking bottlenecks, and unnecessary stress for everyone involved.This guide will help you end that confusion. We explain what a corporate travel policy is and show you how to create one that clearly outlines every step: what’s covered, how to book, and how to manage approvals. With these practical steps, you can control costs, ensure compliance, and make business travel smoother for your entire team.Why create a business travel policy?
Creating a business travel policy ensures that travel arrangements are consistent, cost-effective, and compliant with company standards. It helps manage expenses, reduces risks, and provides clear guidelines for employees, leading to smoother travel experiences and fewer misunderstandings.Travel policies aren’t just rules, rules, rules. They shouldn’t cause frustration and eye rolls. Rather, travel policies can positively impact both travelers and businesses. They help you achieve near-full travel policy compliance. Here’s how:Benefits for travelers (employees)
- Flexibility and autonomy to book their own travel within guidelines
- Safety first! (travelers’ whereabouts are tracked)
- Reduce confusion and hassle with travel booking
What should be included in a corporate travel policy?
Your company travel policy will be affected by how your company travels, who is traveling, and why. However, there are some things that need to be in every company’s policy.First, you must include your approved booking process and tool. Do you want travelers to book with one business travel platform to consolidate their business travel expenses? Do you want travelers to book for themselves within policy, or do you want them to make a travel request to an office manager who books all trips?Your policy should also clearly list what purchases can be expensed and what can’t. This helps employees avoid making purchases that won’t be reimbursed or adding unnecessary expenses to their corporate card. Specify allowable business expenses like meals, entertainment, or event registration fees. And define them from personal expenses—such as laundry or leisure activities—that should not be charged to the company.Don’t forget to address travel safety and insurance. Clearly state the protocols for handling emergencies, provide contact information, and outline the travel insurance coverage available for medical issues or disruptions.Lodging policy guidelines
Mention your company hotel policy rules and lodging expenses in your corporate travel policy. Every organization has different rules regarding accommodation within their corporate lodging policy, so it’s important to make them clear from the get-go.In terms of hotel costs, set a maximum hotel star rating or nightly/room rate that employees cannot exceed. It’s also usual for employees to be required to stay in standard hotel rooms, with ‘deluxe’ suites or rooms off limits.Secondly, be clear about which incidentals can be reimbursed. These can range from room service and dry-cleaning/laundry services to valet parking and the use of hotel amenities (gym, swimming pool, sauna, etc).Bear in mind that hotel rates are subject to both seasonal fluctuations and locations, so you’ll need to be mindful of any nuances depending on the time of year and employees’ destinations. For these reasons, many organizations prefer to partner with specific suppliers and negotiate travel packages and require their employees to use these suppliers wherever possible.Travel and entertainment policy guidelines
You’ll also need to include a section on travel and entertainment best practices. This should include rules and guidelines on what employees can purchase in the name of entertainment while traveling.Guidelines for travel and entertainment should include:- Spending limits for meal expenses (either on a per meal or per day basis)
- Rules on what is allowed when employees are entertaining clients (meals, alcoholic beverages, etc)
- Clear instructions regarding situations where alcohol can and cannot be expensed, and a maximum amount that can be spent on alcohol per head
- List of unallowable personal expenses, such as laundry services, mini-bar charges, and personal phone call charges
- Instructions on information, original receipts, and other documentation required in order to process reimbursements
The travel policy is also a smart place to put your expense reimbursement process. This way, travelers have a reason to check out the policy. You also need to clearly state who the final approver for these expenses is and what the best way to pay for them is (do you offer travel advances? Should travelers use their own debit or credit cards for these payments?).Air travel policy for employees guidelines
Your air travel policy for employees should contain documentation that they can use to check that their bookings are compliant, detailed information on what information is needed to submit travel expense forms, a list of approved in-flight purchases, and, if relevant, a list of your company’s preferred airlines.Two of the most common queries surrounding air travel policies relate to business class bookings vs. economy bookings and rules about using business frequent flyer miles for personal use. Below, we go through these queries in more detail to help you craft the most helpful and clear air travel policy for employees.Guidelines for business class bookings
Make sure employees know when they can or cannot book business class. Business class is much more expensive than the economy, but there could be circumstances when it might be allowed. For example, some companies let employees book a business class if the flight is longer than a specific time frame, usually between six and ten hours. This helps make long trips more comfortable and keeps employees happy—an important travel management KPI to be mindful of.You might also allow business class if it is cheaper than the economy. Sometimes, after adding costs like baggage fees and meals, business class is a better deal. Also, economy seats might not be available for last-minute travel, so the business class could be the only choice.If your policy doesn’t allow business class, make this very clear. This way, there’s no confusion or issues with expense claims later.Guidelines on using business frequent flyer miles for personal use
When employees travel for work, they often earn frequent flyer miles. There’s no universal rule about whether these miles belong to the employee or the company. so it’s important to clarify this in your travel policy. Some companies allow employees to keep frequent flyer miles since the employee is the one traveling. Others believe that the miles should belong to the company and be used to save money on future business flights. For this reason, it’s important to include a section that covers using business frequent flyer miles for personal use.For example, you might allow employees to keep the miles but specify that they cannot choose more expensive flights just to earn extra miles. You could also require that employees always book the cheapest available flight, regardless of their frequent flyer status with a particular airline.Within this section, you should also clarify how employees should record and save the miles they accrue. Using TravelPerk, employees can easily add and save specific airline loyalty program numbers to each employee traveler account, and we’ll also automatically check which of their travel rewards programs apply when they search for new flights.Common challenges with travel policies
It’s not all smooth sailing, or turbulence-free flying when it comes to writing travel policies, here are some common challenges you need to be aware of: - No one reads them or remembers them
- Travel policies are difficult to understand
- Travel policies are not enforced using technology
- Travel policies come across as overly bureaucratic
How to market your corporate travel policy to internal teams
It’s simple: If you want your employees to adhere to your corporate travel policy, you need to communicate the policy effectively.Burying your corporate travel policy within another policy document is almost as good as asking for unauthorized trip bookings and incorrect expense report submissions. Getting your employees on board depends on how well you can market and communicate the policy to your business travelers.Here are a few tips to help you better communicate your corporate travel policies to your employees and ensure higher compliance rates.Make sure that your corporate travel policy is visible and accessible
The first step is ensuring employees can readily access the document via your HR or employee portal.The second step is ensuring the policy is concise and easy to read. Avoid using too much jargon or legalese, and clearly explain the travel guidelines. You might consider dividing the policy into separate sections according to employees’ roles.Lastly, consider creating a checklist that employees can use to tick off each booking or expense submission step as they go.How to improve travel policy compliance with Travelperk
When you book your business travel through TravelPerk, your travel policy is seamlessly integrated into our platform. This not only gives your employees better visibility of what’s in policy but also helps them make more informed choices when booking their trips. Not to mention, your finance team needs more control and peace of mind, too!Create a comprehensive travel policy FAQ section
Even the most concise, well-written travel policies won’t cover every eventuality or question an employee might have. Plus, if you make changes to your travel policy, these too will need to be reflected.If you’re finding yourself answering the same set of questions over and over again, or you’ve been asked a question that you think others may have too, start creating a frequently asked questions (FAQ) section so travelers can readily access solutions.Encourage employee feedback
The most common reason for employees failing to adhere to your policy guidelines is that they don’t enjoy the process, or the process is too clunky. Your traveler experience should be your top priority if you want employees to travel again for the business.Soliciting feedback on booking and expense processes not only lets your employees know that you care about their experiences, but you can also incorporate the most useful suggestions into your policy.Travel Policy Problems By the Numbers
- 64% of millennials understand their company’s travel policy but still book outside of it.
- 72% of businesses haven’t met their desired level of travel policy compliance.
- 50% or more of hotel bookings are outside of corporate policy.
Some of these issues can be solved simply by having a policy that more accurately reflects the needs of the business and the travelers. For example, if half of the trips aren’t compliant, the problem could be that your standard trip budget doesn’t reflect current travel prices or demands. The nature of your business might require lots of last-minute trip bookings, even though these are against the policy.In addition to a realistic policy, the best thing that a business can do is to have a policy that is actionable and implementable using technology. A wiki or word doc or PDF just isn’t going to cut it.You need a policy that lives inside of your booking technology.How to bake your travel policy into the booking process
Because a document can’t affect what people buy, you need business travel booking technology. Use a booking tool that includes customizable travel policies and approval workflows. This way, if a trip is under policy, the traveler or admin can book it. If not, a notification gets sent to the appropriate manager or to finance (based on your prior approval settings for that traveler or department).Now we have established what a travel policy is and why it’s important, have a look at the other aspects of this guide. This online resource will provide help on the following areas of a corporate travel policy:Achieving 100% travel policy compliance has never been so easy
See how TravelPerk is helping businesses like yours improve travel policy compliance3 Things to consider when creating a business travel policy for startups
Business travel policies for startups shouldn’t be vastly different from travel policies for companies that are long in the tooth. Even though you’re just getting started, you’ll need to make sure that your travel policy incorporates everything a more established company would.However, as a young startup crafting a new and unique business travel policy, there are also a few other factors that you’ll need to consider.2. Younger employees may prefer to self-book travel
Millenials are the first generation for which self-booking travel on their mobile device is the norm. While older generations relied on travel agents to book flights, accommodation, and car rentals, millennials are more than comfortable with using online booking platforms and price comparison tools for all of their travel needs.Therefore, they’re much more likely to prefer to book their own travel arrangements — especially when they’re taking advantage of bleisure options. They’re also much more likely to prefer unique accommodation options than your average corporate hotel packages.Making room for this kind of freedom in your startup business travel policy is not only attractive to potential and existing employees, it can often be a more affordable option.Alternative lodging options
The younger workforce sees business travel as an opportunity to explore new places they might not otherwise visit, and this includes the places they stay.Although you’ll have to assess costs and travel safety (always conduct a travel risk assessment!), it could be a good idea to offer alternative accommodation options such as Airbnb to give your employees the opportunity to make the most of their leisure time.Perfect your travel policy with TravelPerk
When creating a business travel policy for your startup, remember to keep your business objectives in mind. Make sure that, as well as considering your employees’ job satisfaction, you’re also making promises that you can keep and that align with your business goals.If you want to make sure that your business travel policy for your startup covers everything you need, check out our travel policy template to get you started.?)
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