How to write an effective corporate travel policy

Increasing travel costs and the enduring remote work model have transformed the corporate travel industry, forcing business leaders to update their travel policies to reflect these trends. A 2023 Mastercard survey revealed that 87% of travel decision-makers agree believe the industry is ready for an overhaul to better support the needs of modern business travelers. 

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Whether you’re creating a corporate travel policy from scratch or revising the one you already have, taking your employees’ needs into account can help keep your policy relevant. Here, we’ll walk you through the purpose of a corporate travel policy and what it should include, then leave you with some tips to encourage adoption in your organization.

What is a corporate travel policy?

A corporate travel policy is a document that describes a company’s policies and procedures for approving, booking, and expensing business travel. These guides typically cover topics like:

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• Booking guidelines and preferred vendors for transportation and lodging
• Approved software for managing travel bookings and expenses
• Guidelines and approval process for out-of-policy travel spend
• Covered and non-covered travel expenditures
• The travel expense reimbursement process
• Trip extensions for personal travel
• Business travel insurance details
• Duty of care procedures and emergency contacts

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In doing so, a travel policy sets consistent standards for everyone in the organization—including executives, managers, finance teams, and business travelers—regarding business travel.

Why should companies have a business travel policy?

An effective corporate travel policy simplifies business travel. Employees refer to this document when booking and managing their corporate travel plans to ensure they comply with company guidelines. The best policies encourage them to make cost-effective booking decisions while still giving them some autonomy with their travel plans. 

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A business travel policy also supports finance teams by curbing out-of-policy spend, streamlining the expense reimbursement process, and simplifying how they track and report on travel expenses. With more accurate data at their fingertips, leadership teams can make more informed decisions about the effectiveness of the company’s travel initiatives.

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What should you include in your company’s travel policy?

Since your corporate travel policy should reflect your company culture and travel program, every company’s policy will look slightly different. With that said, all comprehensive travel policies should include the following sections:

Travel booking procedures

This section should clearly explain how your employees should book travel for business purposes. Do they contact an in-house travel manager or your company’s preferred travel agency to start the booking process? Or are they allowed to self-book using travel management software? Can they use a personal credit card, or should they use a corporate card? 

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Walk them through the steps they should take and provide them with any resources they’ll need. If applicable, include the login credentials for your organization’s travel management tools or information for their point of contact. Mention any preferred vendors for air travel, accommodations, or car rentals here as well. 

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If you allow employees to self-book, encourage them to make responsible decisions with their travel plans. Some travel management platforms offer travelers rewards or loyalty points for choosing cost-conscious bookings. If you use a tool that offers these incentives, make the most of them by describing the program details in your policy.

Air travel guidelines

Help control your company’s travel expenses by creating guidelines around how employees book and manage air travel. Consider adding a checklist for travelers to follow when they book flights for easier compliance with company policy.

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If your company allows business class bookings or upgrades in certain circumstances, describe those policies here. For example, many companies allow travelers to book business class for long-haul flights—just make sure to specify what conditions the traveler or flight must meet to qualify. List any exceptions you make for executives or other leaders here, too. 

Lodging guidelines

This section explains your company’s policies and procedures for booking business travel accommodations. Are employees allowed to book rentals through Airbnb or Vrbo, or do you require them to book standard hotel rooms only? Will your company cover Wi-Fi, room service, or dry cleaning charges? Clearly state details here to avoid misunderstandings later on.

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Ideally, you want to give employees the freedom and flexibility to book accommodations that meet their travel needs as long as they stay within policy. You might set limits on hotel star ratings or nightly room rates, for instance, while giving them free rein over the other aspects of their stay.

Expense categories

Here, list which business travel expenses are allowed and which explicitly aren’t to reduce out-of-policy spend. Organize this section so it’s easy for business travelers to find the information they need at a glance. Also make sure to include the process employees must follow to request and get approval for out-of-policy expenses.

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Here are some expense categories to consider adding to your travel policy:

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Entertainment

This category covers meal expenses, drinks, and other incidentals accrued while entertaining clients on business trips. An easy way to handle entertainment expenses is to give travelers a daily allowance or per diem and then offer specific guidance on whether your company covers the cost of alcoholic beverages under your travel policy.

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Clarify what purchases employees can make for the purpose of entertaining clients. How much are they allowed to spend on business meals? When will the company cover tips, and under what circumstances are they the employee’s responsibility? If your company requires approval for certain expenses or purchases above a specified limit, mention that here.

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Ground transportation

Describe your company’s policy on reimbursing travelers for ground transportation costs. Can travelers expense Uber rides or rental cars? Are there any daily spending limits or restrictions employees should keep in mind? Do they need documentation to get reimbursed for expenses over a certain amount? The more details you can provide, the better.

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Phone use

Phone charges are another business expense employees often incur while traveling for work. Employees traveling internationally may incur roaming charges while making phone calls to clients or their managers, and even domestic travelers may need to pay for Wi-Fi to work effectively on the road. So, take this into consideration when writing your travel policy.

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Non-reimbursable expenses

Adding this list to your travel policy helps explain, in unambiguous terms, what travel expenses the company won’t cover when an employee travels for business. Setting these expectations with travelers well ahead of time helps reduce misunderstandings and out-of-policy spend.

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Generally, companies don’t cover expenses like late fees, personal grooming appointments, pet boarding, travel expenses for spouses or other family members, and any other personal expenses. Update this list annually with any other out-of-policy expenses that get flagged repeatedly by your finance team.

Expense reporting and reimbursement

Companies that reimburse employees for work-related travel expenses must also dedicate a section of their travel policy to explaining their expense reporting and reimbursement process.

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Reduce employee questions and concerns by clearly describing every aspect of the process, including:

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• What information employees must have when filling out a travel expense report
• Whether they need to submit original itemized receipts along with their report
• How much time employees have to submit expense reports 
• Where to submit completed expense reports
• The general time frame to receive travel reimbursements and through what payment method

Travel safety and support

Companies that require employees to travel on their behalf have a duty to keep them safe and supported on business trips. In your corporate travel policy, explain what safety measures you take to protect travelers and any actions they should take to reduce their risk while on the road. 

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Don’t forget to include points of contact, procedures, and any other instructions travelers should have in case of an emergency. What should they do if they get into an accident? What can they expect in the event of a flight cancelation? Provide specifics on your company’s travel insurance coverage so employees understand what’s included. 

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This degree of support shouldn’t be available just for emergencies, though. You should encourage employees to reach out to you whenever they have questions about their trip or your company’s travel policy. Indicate who business travelers should contact for any concerns, how to reach them, and how quickly to expect a response.

Guidelines for international business travel

If your company books both international and domestic business travel, consider creating separate guidelines for each. Doing so will allow you to fine-tune your policy to the unique needs of this type of business trip.

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For example, airfare for international flights is generally higher than domestic airfare, so your budgetary restrictions for domestic flights may not apply to international bookings. Alternatively, to avoid the price hikes that often come with last-minute bookings, you may require employees to book international travel arrangements further in advance than domestic business trips.

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Considerations for remote and hybrid employees 

Now that many companies have adopted a remote-first, hybrid, or distributed work environment, it’s even more important to adapt your travel policy to the changing needs of your organization and workforce.

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According to a survey conducted by the Global Business Travel Association, 48% of travel buyers plan to revise or have already revised their organization’s travel policy to account for remote and hybrid workers. The top areas of focus for these survey respondents include:

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• Types of meetings allowed for travel (40%)
• Frequency of travel to an office (32%)
• Permissible types of transportation (26%)
• Per diems (22%)
• Permissible accommodations (20%)

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If you’re not sure how to adapt your travel policy to today’s way of working, the points above are a good place to start.

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And with many remote employees bringing their work with them as they travel the world, your company can capitalize on this trend by turning business travel into a company perk. After all, turning work trips into “bleisure” travel was the most popular work-life balance measure supported by business travelers in 2022, according to a Statista survey.

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Organizations that support this sort of arrangement should include guidelines in their corporate travel policy.

How to make your corporate travel policy easy to follow

No matter how much effort you put into your corporate travel policy, it’s only as effective as the number of employees who follow it. The simplest and most effective way to increase compliance with your travel expense policy is to make it as easy as possible for the people who use it.

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Start by making sure employees can easily access the policy in different formats. In addition to storing it with your employee handbook and other company documents, give each employee a hard copy and store another copy in the cloud so travelers can access it on the go.

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Below are a few other easy things any company can do to increase policy compliance:

Include a comprehensive FAQ section

Even the most extensive policies won’t cover every possible scenario a business traveler might encounter—and besides, you don’t want to bog down your policy with irrelevant information anyway. Still, you want to make sure your guide is helpful for its readers by addressing as many questions and issues as possible.

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Address these concerns by dedicating a section of your travel policy to answering the most common questions about your company’s guidelines and procedures. Then, you can direct any first-time business travelers to this section of your policy whenever one of these FAQs inevitably comes up.

Use travel management tools to support your employees

Today’s corporate travelers and their employers have access to a wide range of tools designed to streamline nearly every aspect of corporate travel. Everything from booking flights and accommodations to tracking travel expenses to managing itineraries is now fair game.

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Of course, the newest crop of travel management tools doesn’t just offer immediate benefits to travelers and their supervisors. These apps support all areas of your organization, from executives and travel managers to human resources, finance professionals, and other stakeholders.

Automate your corporate travel policy with Ramp

In practice, your travel policy simply serves as a set of guidelines to follow. Some of the questions you’ll receive are best answered on a case-by-case basis, so you likely won’t be able to eliminate out-of-policy spending entirely.

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But one of the easiest ways to ensure employees follow your travel policy guidelines is to automate it with an all-in-one expense management and travel booking platform like Ramp. You can block attempts to book out-of-policy travel or redirect them to a manager for approval, drastically reducing the time it takes your finance team to review and approve expense reports.

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Watch a demo video to see how Ramp’s T&E software can simplify business travel for your finance team, managers, and corporate travelers.