Policy handbook
Copy, edit and adopt. Adjust the limits to your own spend history before rollout.
1.0Purpose and scope
This policy covers travel and business expenses for all employees, with particular rules for field service technicians, installation crews and engineers who travel to plants and customer sites. It sets per diem rates, tool and safety gear allowances and vehicle rules so that people on the road are paid fairly and quickly, and so that reimbursements qualify under IRS accountable plan rules.
2.0Roles and approvals
Field service managers approve their technicians' trips and expense reports, checking each line against the work order or service ticket. Plant controllers approve travel for plant staff. Accounts Payable reviews every report for receipts and coding, and the regional operations director approves any trip over $4,000 or any expense charged to a customer warranty account. No one may approve their own expenses.
3.0Booking and dispatch
Dispatch books flights, hotels and rental vehicles for scheduled service trips through the company travel tool so the work order and travel are linked. Technicians on emergency callouts may book directly and must record the work order number on every receipt. Hotels should be within 25 miles of the site. Bookings must use the company rental account so the corporate insurance applies.
4.0Lodging
The company will reimburse a standard room up to the nightly cap, including taxes, with an itemized folio attached. For installs longer than four nights, technicians should use extended-stay hotels with kitchens. When the customer arranges and pays for lodging, no hotel reimbursement is due. Technicians who stay at home and drive to a site within 60 miles receive mileage instead of lodging.
5.0Per diem meals
Employees traveling overnight receive meals and incidentals per diem at the IRS high-low rate for the locality, paid at 75% on the first and last travel days. Per diem replaces meal receipts, but each day still needs the date, location and work order. When a customer provides lunch on site, the lunch portion is deducted. Per diem is not paid for day trips without an overnight stay.
6.0Alcohol
Alcohol is not reimbursable on field service, installation or plant trips under any circumstances, and per diem is not intended to cover it. Sales and application engineers hosting customer dinners may include up to two drinks per person with approval from the regional sales manager. Anyone operating a company vehicle, forklift or plant equipment must follow the site's drug and alcohol policy.
7.0Vehicles and mileage
Company trucks should be used for site work whenever one is available. Personal vehicle use is reimbursed at the IRS standard mileage rate, with each trip logged by date, origin, destination and work order. Miles between home and the assigned plant are commuting and are not reimbursed. Tolls and parking are reimbursable. Traffic fines, parking tickets and towing are the employee's responsibility.
8.0Tools, consumables and safety gear
Technicians may buy hand tools, fasteners and consumables needed to finish a job up to $250 per purchase on the corporate card, with the work order on the receipt. Larger tools are bought through purchasing and tagged as company assets. Each employee in a plant or field role receives up to $185 per year for safety-toe boots. Lost or damaged tools must be reported within 48 hours.
9.0Entertainment, gifts and personal expenses
Customer entertainment requires approval from the regional sales manager in advance and is nondeductible under the Tax Cuts and Jobs Act of 2017. Gifts are limited to $25 per recipient per year. Personal items, laundry on trips under five nights, in-room movies and family travel are not reimbursable. When a technician extends a trip for personal reasons, the company pays only the business portion.
10.0Receipts and substantiation
Expense reports must be submitted within 60 days after each cost is paid or incurred, and field technicians are encouraged to submit weekly. Each line needs amount, date, place and business purpose, plus the work order number for field work. Itemized receipts are required for all lodging and any expense of $75 or more. Photos taken on the mobile app are accepted as originals.
11.0Corporate card, advances and returning excess
Field technicians receive a corporate card for travel, fuel and tools, and it must not be used for personal charges. Accidental personal charges must be flagged within 10 days and repaid. Cash advances for international commissioning trips are issued no more than 30 days before departure, and unspent advances must be returned within 120 days after the expense was paid or incurred.
12.0Audit, pushback and exceptions
Accounts Payable reviews every report, and a person reviews every flag raised by audit software, such as the same fuel stop on two cards or per diem claimed on a day the customer provided meals. The software may draft clarification requests, but finance approves each message before it is sent. Exceptions need the operations director's written approval, or an explanation within five business days after an emergency.
13.0Consequences
Honest mistakes are corrected through the clarification process and do not lead to discipline. Repeated violations after clarification, such as claiming per diem for days spent at home, lead to a review by the plant controller and may result in loss of card privileges decided by management. Falsifying work orders, mileage logs or receipts is grounds for termination.
Recommended limits
| Category | Limit | Note |
|---|---|---|
| Domestic hotel (per night) | $169 near plants and customer sites; $239 in major metros | Extended-stay hotels with kitchens are preferred for installs longer than four nights. |
| International hotel (per night) | $228 per night, or the customer-arranged hotel | Commissioning trips abroad often use the customer's preferred hotel near the plant. |
| Daily meals (traveling) | Per diem at the IRS high-low rate for the locality; 75% on travel days | No meal receipts needed under per diem. Meals provided by the customer reduce the per diem. |
| Domestic airfare | Economy; one checked tool case reimbursed per trip | Excess baggage for calibrated instruments is reimbursable with the airline receipt. |
| International airfare | Economy; premium economy on commissioning trips over 9 hours | Technicians who go straight to a plant floor after landing may book premium economy. |
| Personal vehicle mileage | IRS standard mileage rate; company truck preferred for site work | Mileage from home to a customer site is reimbursable beyond the normal commute to the assigned plant. |
| Ground transport | Rental pickup or SUV when hauling tools; compact otherwise | Fuel for rentals is reimbursed at the pump receipt; prepaid fuel options are personal. |
| Tools and consumables | $250 per purchase on the corporate card | Above $250, buy through purchasing so the tool is tagged as a company asset. |
| Safety footwear and PPE | $185 per year for safety-toe boots; other PPE issued from the crib | Prescription safety glasses follow the EHS program, not this allowance. |
| Alcohol | Not reimbursable on field service or plant trips | Customer dinners with alcohol need regional sales manager approval. |
| Receipt required at | $75 (IRS threshold) and every hotel folio; none for per diem meals | Per diem still requires dates, locations and work order numbers. |
IRS Accountable Plan clauses
Keep these in the handbook so reimbursements stay excluded from wages under IRC § 62(c) and Treas. Reg. § 1.62-2.
- A1Per diem for meals and incidentals is paid at or below the IRS high-low rate for the locality, and employees must substantiate the time, place and business purpose of travel, which Rev. Proc. 2019-48 treats as substantiating the amount.
- A2All other expenses must be substantiated with amount, time, place and business purpose within 60 days after they are paid or incurred, consistent with the fixed-date safe harbor in Treas. Reg. § 1.62-2(g)(2).
- A3Itemized documentary evidence is required for every lodging expense and for any other expenditure of $75 or more, as Treas. Reg. § 1.274-5(c)(2)(iii) provides.
- A4Advances must be returned to the extent they exceed substantiated expenses within 120 days after the expense is paid or incurred, and per diem paid for days that were not business travel must be repaid.
- A5Any amount not substantiated or returned on time is treated as paid under a nonaccountable plan and included in the employee's W-2 wages, subject to income tax withholding and FICA.
Common pitfalls in manufacturing & field operations
- Paying per diem for day trips with no overnight stay. Meal money for a day trip without lodging is generally taxable wages, not a tax-free reimbursement.
- Letting technicians buy large tools on the card. A $1,140 diagnostic kit bought outside purchasing never gets an asset tag and disappears from the books when the technician leaves.
- Paying full per diem when the customer provided meals on site. The lunch or dinner portion should come out, and nobody catches it unless reports are checked against the service ticket.
- Reimbursing commute miles from home to the regular plant. Those miles are personal under IRS rules, even when the technician also drives to a customer later in the day.
- Keeping a crew on travel status at one site for more than a year. Once an assignment is realistically expected to exceed a year, per diem and lodging become taxable wages.
Questions
No. Under per diem at or below the IRS rate, the amount is deemed substantiated, so technicians only need to record the dates, locations and business purpose, which the work order supplies. Receipts are still needed for lodging and for any other expense of $75 or more. Per diem must be reduced for meals the customer provides on site.
Reimburse the round trip at the IRS standard mileage rate, less the technician's normal round-trip commute to the assigned plant if they would have made that drive anyway. A 280-mile round trip minus a 34-mile commute pays 246 miles. Log the work order with the trip. If a company truck was available, the dispatcher should note why it was not used.
Safety-toe boots required for the job and not suitable for everyday wear are generally treated as a working condition expense rather than wages, so the $185 annual allowance is paid as a reimbursement with a receipt. Paying a flat boot allowance without receipts would make it taxable. Keep the receipt requirement and the EHS requirement for safety-toe footwear documented together.
Book the closest reasonable hotel and note the distance on the report. Mileage between the hotel and the site is reimbursable at the IRS rate. If the drive is over an hour each way, the field service manager may approve a higher-cost hotel closer to the site, because technician hours on the road usually cost more than the rate difference.