What is Travel Policy?
Table of Contents
Business trips without proper planning can cause stress for both employees and organizations. That’s why it’s essential to have a clear and comprehensive travel policy.
An employee travel policy provides detailed guidelines for how employees should handle business travel, including what expenses are allowed, how to book transportation and accommodations, and the procedures for managing costs.
This guide explains what a travel policy is and shows how to create one that clearly outlines every step, including what’s covered and how to manage approvals. By following these steps, a company can control costs, ensure compliance, and make business travel more efficient and hassle-free.
In the Travel Policy Template, You Will Get
- Approved travel booking tools.
- Limit of cost of the booking (hotels, flights, ground transportation).
- Notable exceptions or rules for costlier cities or routes.
- Reimbursement process.
- Permitted and not permitted expenses.
- Travel debriefing process.
- Travel insurance carrier.
- Duty of care vendor or procedures.
What is an Employee Travel Policy?
An employee travel policy is a set of rules and guidelines that establish expectations for employee behavior during business trips. It helps make sure everyone is treated fairly and follows company rules and legal requirements.
The policy typically includes essential elements such as booking procedures, travel expense reimbursement guidelines, and expectations for conduct while traveling.
Travel Policy for Employees Template
A travel policy defines the conditions and guidelines for work-related trips. It serves as a formal document that demonstrates the company’s commitment to ensuring safe and reliable travel, providing employee reimbursement for approved expenses, and promoting employee comfort. At the same time, they represent the organization on business trips.
Purpose
The purpose of the travel policy is to:
(a) Define the process for approving and reimbursing travel expenses;
(b) Specify which travel costs are reimbursable and non-reimbursable by the company; and
(c) Establish clear procedures for managing travel arrangements.
Scope
The policy applies to all company employees. This policy covers all aspects of business travel, including:
- Travel bookings (air, rail, etc.)
- Accommodation
- Local transportation
- Meals
- Incidental expenses
This policy applies to all employees who travel for work and outlines guidelines for Leave Travel Allowance (LTA). The policy is effective from [beginning date] to [end date] and supersedes any previous travel policies.
Legal/Medical Expenses
In the event of traveling to other countries, all expenses related to obtaining a visa (except passport expenses) will be covered by the company.
All medical expenses, including traveler’s medical insurance, examinations, vaccinations, etc., will also be covered by the company.
In case of travel-related accidents, the medical fees will be covered by the traveller’s insurance. If not, the company will reimburse partial/full medical expenses, depending on the situation.
Transportation Expense
For transportation via plane, the company will cover the cost of a round-trip ‘Class’ ticket, a meal (if included in the ticket), one luggage item, and a carry-on bag. The employee is entitled to bear the expenses of extra luggage or duty-free purchases.
For other modes of transportation, the company will reimburse the cost of ‘Class’ tickets. Except in the case of emergency or last-minute travel, bookings must be made at least ‘TimeFrame’ in advance and require written approval from the ‘JobTitle’.
Employees must keep and submit receipts for all other eligible transportation-related expenses to the ‘JobTitle’ at the end of the trip.
Local Transportation
When reaching the destination, employees may use taxis or other local transport for business-related travel.
Receipts must be kept, especially for trips between the airport and the hotel, as well as for travel to any remote locations required for business purposes.
Transportation costs for personal travel, including sightseeing or visiting tourist spots, will not be reimbursed. The reimbursement limit for local transport is not more than the specified ‘Amount in Currency’.
Accommodation
The company will cover the cost of staying during official business trips. If the employee chooses to extend their stay for personal reasons, the company will not cover the additional costs of those days.
Similarly, the company will not pay for an extra room unless a room change is necessary due to reasons beyond the employee’s control (e.g., safety, hygiene, or unavailability of basic services).
The cost of the hotel room must not exceed ‘Amount in Currency’ per night.
On Trip Expenses
The employee is entitled to be reimbursed for lunch and dinner during business trips, up to a maximum of ‘Amount in Currency’ per meal.
If the employee is traveling with someone who is not an employee, only the employee’s meal expenses will be reimbursed. Separate bills must be kept for this.
When having lunch or dinner with clients, the entire bill will be reimbursed. However, if the bill exceeds ‘Amount in Currency’ per meal, approval from the ‘Job Title’ is required.
Reimbursement Claims
Employees must submit all travel-related expense claims within 10 days of completing their trip. To manage travel costs effectively, employees should minimize unnecessary travel by utilizing video or audio conferencing whenever possible.
Additionally, planning trips in advance can help take advantage of lower airfare, and opting for overnight train journeys when possible can further reduce costs.
Work Travel Advance
For work-related travel, an employee may request a tour advance. Any previous travel advances must be settled within 10 days of completing the trip, with all expenses properly accounted for and documented.
Get Your Free Travel Policy Template (Word & PDF)
Pro tips: Use simple words and avoid complicated terms to ensure the policy is easy for all employees to understand. The policy should be applied equally to everyone to ensure fairness and be used consistently.
Optimize Your Travel Policy with factoHR
Create an optimized travel and expense policy using an integrated platform that allows employees to submit travel requests, claims, and reimbursements easily, via desktop or mobile.
Configure organization-specific workflows, including multi-level approvals, spending limits, policy rules, and policy exceptions, while ensuring HR compliance, GST accuracy, managing multiple currencies, and integrating attendance.
Streamline processing, improve efficiency, and align the policy with the company’s strategic objectives and employee satisfaction. If an organization wishes to make sure its travel policy covers everything and is effective, check out factoHR’s travel policy template to get started. To manage travel expenses with ease, use the factoHR Expense Management Software
What are Reimbursable Travel Expenses as per the Travel Policy
Reimbursable travel expenses, as per the travel policy, are expenses an employee pays for during business-related travel. These typically include transportation, accommodation, meals, and other necessary expenses, such as visa fees or miscellaneous costs directly related to the trip’s purpose.
What are the Non-Reimbursable Travel Expenses as per the Travel Policy
Non-reimbursable travel expenses are costs that the travel policy clearly states it will not cover. These generally include personal entertainment, expenses for travel companions, costs incurred by personal choice, or any expenses resulting from violations of laws or company policies.
Why is a Travel Policy Necessary for Employees in India?
A travel policy is crucial for employees in India, as it provides clear guidelines that ensure a smooth travel experience for both the organization and its employees. It helps manage expenses, brings transparency to travel processes, reduces risks, and ensures compliance with legal and company regulations.
What Should be Included in a Corporate Travel Policy?
A corporate travel policy should outline clear policies and guidelines for the following:
- Approval process
- Booking procedures
- Expense management, including spending limits, reimbursable, and non-reimbursable expenses
- Compliance and travel safety
- Reimbursement process
What are the Common Challenges with Travel Policies
Common challenges with travel policies include striking a balance between cost control and traveler well-being. Inefficient expense management and tracking can result in significant financial losses, with some companies losing up to 15% of their travel budgets.
Additionally, ensuring employee safety is also a complex task, particularly during travel disruptions.
What is a Travel Insurance Policy?
Travel insurance is a contract that protects travelers from unexpected costs while traveling. It can cover things like canceled trips, medical emergencies, lost luggage, and flight delays. The goal is to provide financial security.
Disclaimer
This policy template is meant to provide general guidelines and should be used as a reference. It does not take into account all relevant local, state, or central laws and is not a legally binding document. Neither the author nor factoHR assumes any legal responsibility for issues that may result from using this policy.
