Introduction to Corporate Travel Policies
When you’re tasked with creating a company business travel policy, it’s tempting to slap something together and call it good. But your policy has the power to affect future decision-making by travellers, managers, and admins. It can help you consolidate your company travel, making it easier to report and track business trips, or it can fail to affect behaviour at all.
In this guide, we explore what a corporate travel policy is and what it can do for your company. We delve into best practices, tips for writing a customizable corporate travel policy template, achieving travel policy compliance, managing trip approval using tech, and automating the business travel booking process with BNW Travel.
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Defining a Travel Policy
A travel policy is essentially a company’s rules and procedures outlining how employees should approve, book, and expense travel for business purposes. Corporate travel policies are usually created by the Finance Manager and the Travel Manager and typically outline things like, if an employee can fly business class, how many weeks or business days in advance they should book their trips, or if there are certain precautions employees must take when travelling alone.
A comprehensive travel policy would normally pertain to both international and domestic travel, and have information about the following:
- Booking procedure and approved corporate travel company (such as BNW Travel)
- Allowable cost of booking (hotels, airfare, ground transportation)
- Special exceptions or rules for more expensive cities or routes
- Preferred company vendors
- Approval process for trips that exceed typical limitations
- Reimbursement process
- Permitted and not permitted expenses
- Travel debriefing process
- Travel insurance carrier
- Duty of care vendor or procedures
Clearly, a travel policy isn’t just about the moment of booking and its related expenses. It also controls all your travel arrangements and affects employees in many different departments.
The Importance of Business Travel Policies
Clear Guidelines Mean Fairness for All
Travel policies aren’t just rules, rules, rules. They shouldn’t cause frustration and eye rolls. Rather, travel policies can positively impact both travellers and businesses. Here’s how:
Benefits for Travellers:
- Flexibility and autonomy to book their own travel within guidelines
- Safety first! (Travellers’ whereabouts are tracked)
- Reduce confusion and hassle with travel booking
Benefits for the Company:
- Reduce spikes in travel spend and gain control
- Reduce friction and frustration over expenses and reimbursements
- Reduce total costs on business travel and optimize your company's budget
- Increase fairness and foster a positive company culture
Essential Components of a Corporate Travel Policy
Your company travel policy will be affected by how your company travels, who travels, and why they travel. However, there are some things that need to be in any company’s policy.
It’s essential to include your approved booking process and tool. Do you want travellers to book with one business travel platform like BNW Travel to consolidate your spend? Do you want travellers 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, that way your travellers don’t unknowingly buy something that they won’t get travel reimbursement for or add unnecessary expenses to their corporate card. Business expenses like entertainment expenses, business meals, or registration fees for events, for example, all need to be clearly outlined in your policy.
Lodging Policy Guidelines
It’s also important to insert your company hotel policy rules and lodging expenses into 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, it’s common for organizations to 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 travelling.
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 travellers 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 travellers use their own debit or credit cards for these payments?).
And finally (but certainly not of lesser importance), you need to include all of the safety information that travellers need. What should they do in case of an emergency while they’re away? Who should they contact for different types of emergencies? What insurance is available to them?
For more details on all of the above, see our corporate travel policy template and section on how to write a policy.
Air Travel Policy for Employees Guidelines
Creating an easy-to-follow air travel policy for employees is essential to help keep your employees safe and your business travel expenditure as low as possible.
Most importantly, your air travel policy for your employees should contain documentation that they can refer to 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 both of these queries in more detail to help you craft the most helpful and clear air travel policy for employees.
Guidelines for Business Class Bookings
The rules regarding your corporate travel policy on business class bookings are an important section to include. Whether employees are not permitted to make business class bookings under any circumstances, or whether there are specific scenarios where they can, you need to make it clear from the outset what the rules are.
Although they’re typically less cost-effective than coach class bookings, there are circumstances where it makes sense to opt for business class bookings. For example, many companies specify in their corporate travel policy that business class bookings can be made if the travel segment exceeds a certain amount of hours (common benchmarks are anywhere between six and ten hours).
This type of rule allows companies to offer their employees comfort and flexibility during long-haul business travel, and can have a positive impact on traveller satisfaction—an important travel management KPI to be mindful of.
You’ll also need to consider a section where employees are permitted to use business class bookings when they’re cheaper than economy bookings. For example, there will be times when economy bookings are more expensive than business class after costs such as baggage fees and in-flight meals are factored in.
Another circumstance where employees could be allowed to make business class bookings is in the case of booking last-minute travel, where economy class bookings may be unavailable at short notice.
Remember, if there are no circumstances where employees are permitted to make business class bookings, make it exceptionally clear in your corporate travel policy to ensure there are no issues during the reimbursement process.
Guidelines on Using Business Frequent Flyer Miles for Personal Use
When your employees travel, they rack up frequent flyer miles. There is no global corporate standard in place that governs whether the company or the employee keeps the frequent flyer miles. For this reason, it’s important to include a section that covers using business frequent flyer miles for personal use.
Some companies recognize that it is the employee, not the company as a whole, who is travelling, and that employees should therefore be permitted to keep their frequent flyer miles. Others prefer to stipulate that frequent flyer miles should belong to the company and be used to reduce costs by using the miles to save against future flights.
Since there is no global standard, companies should define specific rules regarding employees using business frequent flyer miles for personal use to avoid any confusion. For example, you may want to allow employees to use frequent flyer miles, but stipulate that they cannot use higher fares for the purpose of earning extra miles. Similarly, you could make it clear that they must always travel with the least expensive airline, and not the airline with which they have a frequent flier relationship.
Within this section, you should also clarify how employees should record and save the miles they accrue. Using BNW Travel, employees can easily add and save specific airline loyalty program numbers to each employee traveller 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
Most likely, you don’t want your travel policy to collect literal or virtual dust. Unfortunately, too many of them do. Here are some common problems with travel policy documents:
- Travel policies are difficult to understand
- No one reads them or remembers them
- Travel policies are not enforced using technology
- Travel policies come across as overly bureaucratic
How to Market Your Corporate Travel Policy with BNW Travel
It’s simple: If you want your employees to adhere to your corporate travel policy, you need to communicate the policy effectively and integrate it with a powerful travel management solution like BNW Voyage Pro.
BNW’s corporate platform, powered by ORX Travel Management Platform, is a comprehensive corporate travel management solution that can help you take control of your company's travel expenses while streamlining the travel booking and policy compliance processes.
BNW makes it easy to ensure compliance with your company's travel policies. Every fare and hotel is marked to ensure your employees know if a booking will be compliant. The platform provides flexible approval options and real-time trip reports, allowing you to monitor travel bookings and expenses in real-time. Automated booking approval workflows help you control costs and maintain adherence to your company's travel guidelines.
