How to Reduce the Cost of Employee Business Travel
Common Tactics Employers Use to Cut Employee Travel Expenses
With some sympathy for employers who are trying to control travel costs, asking employees to share rooms is not where to start - or finish.
These ideas are less stressful and offensive to the average employee who travels for business for their employer. Employees are normal humans who want some privacy and distance from co-workers while on a business trip, especially if they have spent the day with coworkers. Employers don't need to ask employees to share rooms.
Other Ways to Save on the Cost of Employee Business Travel
- Require employees to travel on the same day whenever possible.
- Develop and implement a firm travel policy that provides specific details about per diem payments at various destinations, preferred hotel chains where the employer may have established a discount rate, reimbursements for expenses, and limits that require a manager's signature in advance if exceeded.
- Hold employees to the letter of the law as stated in the travel policy without prior authorization of exceptions. Do not reimburse expenses that were not allowed by policy or exception.
- Renegotiate or negotiate corporate rates with hotel chains common to your destinations. Look for hotels that offer amenities such as complimentary breakfast, a complimentary cocktail hour, afternoon snacks and appetizers, and refrigerators and coffee makers in the rooms. Require employees to use these hotels and amenities when they are available.
- Use a less expensive hotel chain when making reservations. Most employees would give away a star for a private room. Don’t expect lower standards in areas such as cleanliness and other employee comfort amenities from hotels that are rated with fewer stars. Survey traveling employees periodically to make sure the selected locations meet their needs.
- Use a consistent travel booking service such as American Express Global Business Travel to help control costs. They will help you plan, adopt policies, save costs, and limit employee spending. Even local travel services can assist you to save on business travel. But, the advantage to an American Express company is its reach nationally and internationally and its online services.
- Make arrangements with one airline to use their services whenever possible to receive a corporate discount on every flight. Require employees to use the airline’s booking service, for example, Southwest Airlines Corporate Travel. Employers can also save when planes are booked well in advance.
- Make employees who make last-minute travel decisions obtain authorization. In one case, in a client company, a plane ticket that would have cost $300 if booked a few weeks in advance cost over $1200 when the employee made the reservation two days before the event. This should only happen in an emergency as most tickets are transferrable even if they are not refundable.
- Reduce travel costs in other areas, such as meal and alcohol per diems and transportation. Vary the per diems by the location. New York City is expensive compared to Las Vegas, for example. Smaller, non-resort areas are even more affordable. Your travel policy should reflect the costs your employees will experience as they travel to different states and locales.
- Experiment with virtual meetings, services such as Skype for Business, and videos. While initially uncomfortable, not-in-person meetings are an acquired skill. Employees do become more comfortable as they use these services over time. Webinars work well for various kinds of training, especially seminars that allow multiple employees to attend.
- Require your employees to use less expensive public transportation and shuttle services, when they are available, rather than taxis, especially when employees travel between airports and hotels. Most large conferences offer free shuttle service between the hotels and the conference center. Less taxi usage or the requirement that employees gather to pay for a group taxi can save a lot of money.
Asking adult employees to make timely reservations, budget expenses on their business trips, and explore options other than travel for meetings and training is the right approach to streamlining the costs of business travel. They are respectful of employees.
They benefit the employer because employees feel respected and cared about, which produces positive morale. They keep the positive relationship cycle moving in the right direction.