Sample Employee Business Expense Policy
The Employee Expense Policy outlines procedures for reimbursing employees for work-related expenses. It categorizes expenses into those paid directly by the company and those reimbursable to employees. The policy emphasizes documentation, approval processes, and defines both reimbursable and non-reimbursable expenses.
This Employee Expense Company Policy template is ready to be tailored to your company’s needs and should be considered a starting point for setting up your employment policies.
This employee expense policy should include:
- Definitions of work-related expenses and the distinction between company-paid and reimbursable expenses.
- Clear guidelines on what constitutes reimbursable expenses and the documentation required.
- Procedures for submitting reimbursement claims, including timelines and the approval process.
Employee expense policy template
Policy brief & purpose
Our Employee Expense company policy outlines how we’ll reimburse employees for work-related expenses. We’ll define “work-related expenses” and set a procedure to authorize expenditure.
Scope
This policy applies to all our employees that need to spend money for work-related activities.
Policy elements
Employee expenses fall under two categories:
- Expenses that are paid directly by our company on behalf of employees.
- Expenses that are paid by our employees and are reimbursable.
We’ll reimburse all reasonable business expenses, after they are approved, in part or in full as the case may be.
Travel Expenses
Travel expenses include any kind of transportation and accommodation expenses that you incur when going on a business trip. Expenses related to this category that may be fully or partly reimbursable include:
- Accommodation
- Legal document expenses (e.g. Visa)
- Air, train, ship or other transportation fares
- Necessary medical expenses (e.g. vaccinations)
- Local transportation during trips (taxi fares, rental cars etc.)
- Other minor or per diem expenses that have been approved by an employee’s manager (e.g. meals, business material)
Medical care fees after travel-related accidents may be covered by workers compensation insurance. If not, we may reimburse you for your medical expenses, if appropriate.
Minimizing expenses
We want to avoid overspending or unnecessary costs. We may contract with hotels and agencies to get the best possible prices. We’ll also aim for the cheapest option when we can. For example, we prefer booking plane tickets in economy class, unless there is reason for upgraded travel.
Non-reimbursable expenses
We won’t reimburse the following:
- [Expenses incurred by spouses or other non-employees who accompany our employees on their travels]
- [Un-authorized service upgrade (e.g. business class or hotel rooms)]
- [Personal services (massages, beauty treatments etc.)]
- [Personal purchases (gifts, clothes etc.)]
- [Lost personal property (e.g. luggage)]
This list is not exhaustive. Please ask [Human Resources (HR)/ Compensations manager] about reimbursable expenses before you go on a business trip.
What are work-related expenses?
This category includes expenses that are related to an employee either in the form of a benefit (e.g. business phone) or entertainment expenses that may occur in a business setting (e.g. professional dinners with clients or colleagues.)
These expenses may be capped and [HR/ employee’s manager] should approve them. If you spend more than the approved amount, you must cover the extra cost yourself.
We won’t reimburse the following work expenses:
- [Unauthorized or unscheduled business meetings with clients, partners or job candidates]
- [Fines incurred while driving a company vehicle]
- [Non-business subscriptions/ training]
- [Personal trips]
This list is not exhaustive. Please ask [Human Resources (HR)/ Compensations manager] about reimbursable expenses before you submit a claim.
Procedure
When you plan to go on work-related trips, [Office managers/ personal assistants/ HR] will typically arrange for most of your accommodation and transportation costs and document these expenses. You need to:
- Document any expenses that our company hasn’t directly arranged for (e.g. taxi fares.) Please ask for bills and receipts whenever you can. You might also receive a per diem sum to cover other necessary travel expenses.
- Submit your reimbursement claim [through an Human Resources Information Software (HRIS)] or submit an expense report with all necessary documentation. Please submit your claim/report within [three months] after your trip.
Your manager or HR are responsible for approving reimbursement claims. If your manager approves your expenses, you will receive your reimbursement within [two] pay periods [by check.]
When you incur work-related expenses, you should:
- Ask for your manager’s approval.
- Submit a reimbursement claim. Please submit receipts and bills for business dinners and transportation within [one month.]
We’ll investigate any excessive expenses. In cases of consistent falsified or exaggerated claims, we may take disciplinary action.
| Disclaimer: This policy template is meant to provide general guidelines and should be used as a reference. It may not take into account all relevant local, state or federal laws and is not a legal document. Neither the author nor Workable will assume any legal liability that may arise from the use of this policy. |