How to nail the perfect travel policy
What is a travel policy?
Travel policies are documents that outline the different variables of travel and guide the booker or traveller to make decisions for bookings and expense reporting. They must be aligned to the culture and objectives of the business as well as the different people involved in the process: traveller, travel booker, management.
What are the benefits of a travel policy?
A travel policy is necessary for any company with travelling employees. There are a range of benefits to having a travel policy, not just for the business but also the traveller.
Keeps travellers safe
A travel policy is not just about the company. It also serves the purpose of keeping the traveller safe. Companies have a Duty of Care to their travelling employees to ensure their health and safety. It outlines essential details like travel insurance, different flight classes for long-haul flights for the traveller's wellbeing, and even stipulations like travellers must take taxis late at night and avoid public transport.
Saves the company money
You’re heading off on a work trip, and although it might be tempting to travel like a star, your company will have a bottom-line to consider. Travel policies outline key items like expected costs for accommodation (you don’t need the presidential suite – unless you’re Oprah), flight costs, and preferred methods of transport. It sets limits so that travellers don’t send the company broke.
Streamlines the process
Imagine if you had to check with your manager at every stage of booking your business trip. Can I book this flight? Is this too expensive? Can I pick the closer hotel that’s more expensive? Am I allowed to Uber to the office? Can I expense claim my parking at the airport?
Although it might seem like a day-trip to Oslo, Helsinki, or Stockholm can’t be that complicated, it’s not just about booking a flight and heading off. There are a number of questions that need to be answered about what the traveller can and can’t do, what they can and can’t book. A travel policy aims to answer all of those questions before anyone asks, to ensure there’s a travel policy template to refer to when making travel decisions.
What to include in a travel policy?
A travel policy should consist of everything that you want employees to know AND be accountable for. Remember your travel policy will be enforceable, in case someone decides to go on a spending spree and you need to address it with them. Travel policies look different from company to company, as travel can vary between different industries. Here is a core list of items that FCM Travel recommends each company consider for its travel policy.
Your Travel Management Company
Your travel policy should stipulate who you use as a Travel Management Company to ensure the consolidation of the travel program.
Your Travel Management Company (TMC) will guide you when setting up the travel policy, it’s their job to provide advice and templates to help. At FCM Travel we’re also fortunate enough to have great technology and Online Booking Tools that can be incorporated into the travel policy to ensure compliance from bookers and travellers.
Preferred suppliers
Does your company have an agreement with an airline or accommodation supplier? This could impact the way travel is booked and when/where travellers depart from.
Some companies have agreements with a set airline to access negotiated deals or benefits. If a traveler decides against using the preferred supplier, they will usually need to strongly justify why that was. So, expect questions if you go outside of the policy.
Travel Insurance
For international trips, travel insurance is paramount as health care can be more expensive and scarcer in some parts of the world. It’s important to check if your company has a corporate travel insurance policy to cover anyone travelling, or whether you need to purchase individual cover for the trip.
Flight bookings (Class and Price)
While it might be tempting to book business class (who wouldn’t want to), domestic business class flights are usually three-times the cost of economy class. If you’re on a plane for 1-2 hours, is that really worth it? Travel policies outline which class of flight you can purchase and what prices you need to stay under.
Reimbursable and non-reimbursable expenses
This is a really key one, you’d be surprised how many first-time business travellers don’t know they can get certain things reimbursed. Things like reasonable costs for meals to laundry if you’re on a longer trip. On the flip side, we also find some travellers try to over-claim expenses but things like clothing or toiletry purchases, a haircut or massage, or minibar costs are usually excluded, and you’ll have to pay for them yourself. The travel policy will outline clearly what you can and can’t claim as an expense.
Steps to creating a travel policy
There are nine simple steps to creating a travel policy for your business. At FCM Travel our expert staff are here to guide you through the process. Contact us today to discuss your options.
- Select a Travel Management Company to assist with your travel policy.
- Define what’s important to your business and involve Finance, Procurement, and HR.
- Identify any existing partnerships or preferred supplier agreements.
- Identify any travel budgets or limits for trips.
- Define the expense and receipts management process.
- Write it all down.
- Distribute to staff.
- Hold staff accountable.
- Review the policy every 6-12 months.