should we reimburse employee meals for same-day travel?

by Ask a Manager on March 30, 2010

A reader writes:

Our office has a number of staff that travel to our various satellite offices — most of the travel is same day (home to office back to home)(no overnight stays). There are a few staff members that feel like they need to be reimbursed for breakfast and lunch and sometimes even dinner (if they leave after 5pm) from these satellite offices. Our accounting department has asked me to create a policy for same day travel prohibiting reimbursement for food. Can we do this? (Or, really, should we do this?)

Can you do it, legally? Yes, absolutely. Should you do it? Well, maybe it’s because I’m from the nonprofit world, but I agree that, at least at first glance, asking for meal reimbursement without overnight travel might be excessive. But let’s look at it more closely.

Is there some reason why a local journey that doesn’t involve overnight travel is sticking them with higher meal costs than they would have had if they spent the day in the office? Maybe there is — maybe, for instance, they’re traveling to locations that make it impossible for them to stick to their usual lunch routines, whether that’s brown-bagging it or grabbing something cheap outside the office. And if there is, you should consider that; you don’t want to financially penalize people for doing their jobs.

Or maybe these day trips have them on the road from 5 a.m. until 9 p.m. If the hours are unusually long during these day trips, then I’d recommend reimbursing them in recognition of the hardship and quality of life imposition.

So the first question is: Would a reasonable person expect to be reimbursed in this situation, or are these employees trying to take advantage of the company?

And even if a reasonable person wouldn’t expect it, you might also ask: Do you have the luxury of doing this as a perk for your employees anyway? If the company is flush, you may choose to treat employees extra-well in ways like this — because doing so can help with morale, retention, and even recruitment. You want to be able to attract and keep the best people out there, and perks don’t hurt. On the other hand, you may not be flush, or you may be a nonprofit, where you generally don’t want to spend donors’ money on luxury-type perks.

So I’d think about all of these things before deciding this. And ideally, the decision wouldn’t be made by the accounting department, but by someone who’s charged with thinking strategically about employee relations.

Bookmark and Share

{ 17 comments }

Rebecca March 31, 2010 at 2:29 am

As an employee that has been in this situation, I think that you should at least reimburse for lunch, and I agree with the idea that for a really long day there should possibly be compensation, especially in the situation you said where someone might be gone 12+ hours and arriving home well after an evening meal time. However, I think it would also be reasonable to set an amount for meals, and tell employees you will reimburse "up to" $X for lunch on those days.

I worked at one company (no daily travel there) that was super cheap about almost everything, but had zero limits on meals during travel times. This result of this was that when the company met their annual sales goal, they celebrated it with bagels, while the next week, I could turn in a receipt for a $100 dinner because I was out of town on business.

Anonymous March 31, 2010 at 3:31 am

If they are expected to be away from home and office for all three meals, the very LEAST you could do is reimburse their meals. The employer might consider not treating their workers like slaves too.

Beyond that, employees should be reimbursed when their meal expenses are greater than what they would have been if they had not been traveling. And it isn't the hotel that sets their meal prices during the day, so where they sleep at night shouldn't have anything to do with it.

Lulu March 31, 2010 at 4:28 am

Our university recently stopped reimbursing for (any) meals when the travel is less than 24 hours, or does not include an overnight stay. Before, for travel that was more than 12 hrs but less than 24hrs – there was a lower per diem rate. But now, there is no reimbursement whatsoever.

When I explained this to an employee, he exclaimed "but I have to eat!" True, but at the same time, he would have spent the same amount (on lunch, at least) had he not been on travel.

I've had students request reimbursement for food purchased at grocery stores and even though their situations were different (since their travel was over 24 hrs), it was somewhat disconcerting seeing them spend $5 on a carton of strawberries, and expecting to be reimbursed for it.

If it were up to me, I would create a policy to reimburse a certain amount for same-day travel (which may be less than overnight travel). I also think maybe there should be a difference in where you are traveling – in the OP's situation, the travel is local. It's different if you have to travel to a location where food establishments are few and far between, or where the prices might be higher (such as at an airport, or on/near a university campus).

@Anonymous – basing reimbursement on whether or not the employee spent more than he/she normally would (if not on travel) doesn't work. Using that sort of scale, I should eat cheaply at home and get some lobster/prime rib when I travel. That would be an incredible waste of company money.

Anonymous July 28, 2013 at 10:38 pm

I disagree with your statement that the employee would have to pay for their meals had they been home anyway…not entirely true. When I travel on a 13 hour day trip for work, I leave my house at 7am and I’m home by 8:45pm. I would eat breakfast at 8am AT HOME and dinner AT HOME at around 7pm. My company only serves lunch at the meeting.

Anonymous March 31, 2010 at 4:55 am

It seems to me that if employees are required to spend their time traveling, their meals should be reimbursed even if they aren't traveling terribly far.

Why do companies reimburse for meals when employees travel out of state? As I see it, the reasons are:

-The employee is traveling on business and is expected to spend the majority of their waking hours focused on that task; as such, even things like going out for a meal are part of the job the employee is doing.
-Travel means employees can't stick to their normal meal routines if those include cooking at home or bringing a brown-bag lunch. The company is asking the employee to give up their normal meal options, so the company should compensate the employee for the remaining option.
-An employee who is dealing with the inconvenience of travel in order to do their job will be happier if provided with a few perks.

All of those reasons seem to apply to day trips, with the possible exception that, in certain cases, it would be possible–if inconvenient–for the traveling employee to bring a lunch.

IMO, ideally someone at the satellite office would just use a company card to treat the traveler to a lunch, over which they'd discuss business. This would be an approved expense. I don't think breakfast should be approved for a one-day trip (breakfast is a meal that ought to be eaten before leaving home regardless of where one is going) but if it is 12 hours or more a dinner should be reimbursed also.

If specific employees seem to be abusing the reimbursement policy, that's not an excuse to punish those who are working long days at the satellite offices and just want to be able to grab a modest meal without spending out of pocket. Individual bad apples should be dealt with by their managers in a private conversation about the proper use of reimbursement.

Chuck March 31, 2010 at 12:20 pm

I think those employees who have made such an outrageous request should be congratulated! They've helped you identify those who should be laid off first when that becomes necessary.

No overnight travel = no meal reimbursement. (I assume you do reimburse mileage.)

Given the high unemployment rate, this is a great time to cull the herd and improve the team. Let some other company buy them lunch!!

Class factotum March 31, 2010 at 1:58 pm

I almost always took my lunch (and my breakfast – I went to the gym at 5:30 a.m. and then directly to work – yes, I showered) to work. I also took my own case of diet Coke because it was so much cheaper than getting it from the machine. If I had to be at an all-day meeting in another building, I expensed my machine diet Coke. My theory was that I was being forced to spend money that I would not otherwise spend. Nobody ever said a word. It's pretty bad that a company would consider not covering lunch for traveling employees.

Lulu, I had a job where I traveled almost all the time. I was just out of college and hated to go to restaurants alone, so I would either eat room service or go to a grocery store and buy strawberries and exotic deli items that I could never have afforded on my paltry low-income, studio apartment, student-loan repaying budget. The company still spent less than they would have if I had gone to a restaurant and I was happy to get something I wouldn't otherwise eat. Why do you care how they spend their money as long as they are within the limits?

Anonymous March 31, 2010 at 3:58 pm

Reimbursement for meals without an overnight stay is taxable income to the employee. That's an IRS rule.

Anonymous March 31, 2010 at 4:38 pm

Ok, just to play devils advocate a bit, let me see if I understand this correctly. Julie gets up Monday morning for her 9 5 job and eats breakfast before leaving the house, comes into the office and at some point has lunch by either eating what was brought from home or goes out to a restaurant at her own expense, then goes home and eats dinner. On occasion she needs to stay until 5:30 or even 6:30 to finish her work, not necessarily a normal occurrence but it still happens.

On Tuesday she needs to drive to a satellite office so she has to get up 90 minutes early (because the satellite office is further away from her house and takes longer to get to) eats breakfast before leaving then drives to the satellite office. At some point she has her lunch by either eating what was brought from home or goes out to a restaurant at her own expense, then goes home and eats dinner. Since this satellite office is further away she still leaves at 5:00 but doesnt get home until 2 hours later because of the increased distance of the satellite office and heavy afternoon traffic.

Why, in this situation would she expect the company to pay for her meals? She still has the option of getting up earlier to eat breakfast at home, she still has the option of either bringing her lunch or going out to eat at a restaurant (like she does anyway at her normal office) and she might be eating dinner a bit later because of the increased drive time, but still can do so at home.

Maybe if the satellite office was such a greater distance that it increases the employees work day by many hours (getting up at 4 am and not getting home until 9 pm) I could see the company paying for a lunch and possibly a dinner, but if there is no overnight travel required I dont see why visiting a satellite office should include a days worth of free meals. Keep in mind that there are many variables that need to be weighed before a decision can be made, but it seems to be a bit of an excessive demand. However, if its a regular occurrence, for example, every Tuesday and Thursday the work day is from 4 am to 9 pm because of the trips to distant satellite offices twice a week, then I might see why they should be asking for meal reimbursement, but if its not a common occurrence (several times a week) I dont see the merit of it.

Anonymous March 31, 2010 at 6:27 pm

I'm in the corporate side of retail, and I can't imagine same-day travel meals being expensable. Imagine a district manager, whose job it is to go around and visit all the stores in their territory, expensing every meal because they're always on the road!

Anonymous March 31, 2010 at 8:09 pm

I think it's pretty ridiculous for an employer to make it a policy to pay for meals with no overnight stay. The only exception would be if no break time is provided to eat. I would address it by writing a policy on travel and per diem/meal reimbusements.

Rebecca March 31, 2010 at 9:30 pm

(different Rebecca from the first poster)

Seems pretty clear that whatever you decide, you oughta have a policy. Either nothing or a flat dollar amount seems fair to me.

Anonymous April 1, 2010 at 1:32 am

I once worked for a company that tried to implement a policy like this.

Pretty soon, managers were 'interpreting' the policy to mean that workers had to sleep on airport floors (or in their car or wherever their could find a place)–so long as they didn't turn in a hotel receipt for the same day, the company didn't have to feed them.

Is that really the type of culture you want to create?

I am not interpreting 'travel to satellite office' as the same as '90 minute car drive' which appears to be how some have interpreted it. Satellites could easily be a plane ride away and yes it is possible to fly somewhere and back in the same day.

Lulu April 1, 2010 at 4:42 am

@Class factotum – it makes a difference to me as a taxpayer. We are a public institution, so the money comes either directly from the state (or public donations) or indirectly from the federal government.

I'm not saying I expect students and employees to scrimp and cut out coupons. Just because I choose to be economical doesn't mean it's the right life style for everyone. On the other hand, it would be nice for students/employees to understand that it's not just free money. The money has to come from somewhere – which means when there's no money left, you're going to be let go too.

Also, I didn't mention (and my earlier post was ambiguous), though I don't know if it makes a difference – for domestic travel, our univ does not have a per diem rate. We have a maximum daily allowance and technically we only reimburse what was actually spent. No receipts are required but if you submit an expense report w/ the daily maximum everyday, accounting will ask you to verify that you did actually spend that amount.

In principle, I'd want to reimburse for meals because I think happy employees are more efficient (or at least, unhappy employees are frequently inefficient) – but I also think some people abuse the system, which sucks for the rest of us.

Anonymous April 1, 2010 at 10:14 pm

A few people are interpreting "satellite" offices meaning drivable. I've done day trips to an operational office where it is 5 am out the door to the airport and back home @ 8pm if I'm lucky.

Chuck's view is silly given the limited facts. Is a reimbursement request outrageous? If my time at the satellite office is close to the main one and doesn't add major amount of travel, I'd only reimburse lunch at a most. A 15 hour plus door to door is another story. Abusing the reimbursement should be handled on an abuser by abuser basis. Don't change the rules because of one bad apple. It shows lack of managerial leadership. Deal with the bad apple – either fix the problem or terminate it.

Anonymous April 2, 2010 at 3:41 pm

Can you exclude or reimburse same day travel expenses? Yes to both.

Should you? Yes to reimbursing. The meals fall under business expense but more than that they should be comped for all travel related expenses incl gas, car rental, airfare etc.

Not comping for same day travel is 1. cheap, 2. places a financial burden on the employee and 3. raises a flag on the financial stability of the company.

Mostly, it's cheap and will have top talent iso profitable, read stop taking advantage of me, employment at the first
opportunity.

Lulu April 3, 2010 at 4:19 am

@OP – something to think about: I happened across a newsletter put out by our corporate finance office when the policy regarding same-day (less than 24 hrs) travel changed. They decided to make the change to match (in their interpretation) the IRS Taxable Fringe Benefits guide. I don't know exactly what the IRS policy is, but I guess that if travel is less than 24 hrs, meal reimbursements would count as taxable income. As far as I know, reimbursements (for transportation, lodging, etc) aren't generally taxed.

The exception would be if the meal was required (such as a working lunch or eating with clients, as opposed to if you were allowed to take a lunch break and not work during lunch or whatever meal it was).

So that may affect how you and your accounting department shapes your policies…

Previous post:

Next post: