Employment - Employee Expenses Policy

This document provides a policy in relation to expenses employees incur in the performance of their duties and for which they will be reimbursed by their employer.

The policy sets out that the expenses must be:

- reasonable;
- incurred in the performance of the employee’s duties; and
- pre-approved, although with discretion to reimburse expenses that were not pre-approved.

The policy also sets out the procedure for reimbursement and provides a pro forma claim form to use.

The policy document includes provision for employees to sign to acknowledge that they have read and understood the policy. You might consider giving employees 2 copies of the policy and asking them to sign and return a copy which will be placed on their personnel file.

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Company Details
• Who should authorise the policy?
• Do I have to include a review date?
Policy Details
• Is there room for discretion?
• Is there a limit to approvals?
Policy Details Continued
• Putting your policy into practice
Related Policies
• Related policies

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Company Details

• Who should authorise the policy?

  Policies should be authorised by someone with a senior position within the business. As personnel change, we recommend that the policy is authorised by reference to the position held rather than the individual (eg Managing Director).

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• Do I have to include a review date?

  It is not essential to include a review date; however, we recommend one be included to prompt you to review the policy regularly (perhaps every 2 years) to ensure it still meets the needs of your business.

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Policy Details

• Is there room for discretion?

  The policy requires that expenses be pre-approved. In reality, there will be circumstances where pre-approval is not practical. The policy allows you to nominate a senior person who has the discretion to approve reimbursement of reasonable expenses where the employee did not obtain pre-approval from a line manager.

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• Is there a limit to approvals?

  The policy allows you to set an upper limit of expenses that a line manager can approve. For example, you might allow a line manager to approve expenses up to $150 but require the managing director to approve expenditure above this amount. You need to nominate the position of the person who can approve expenditure above the limit.

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Policy Details Continued

• Putting your policy into practice

  Based on the requirements of your business, you will need to consider:
  
  • who completed claim forms are to be submitted to (eg accounts clerk);
  • within how many days a claim must be submitted for reimbursement (eg 28 days);
  • within how many days reimbursements are likely to be made (eg 7 days);
  • whether reimbursements will be made by cash, cheque or direct debit; and
  • if cash reimbursements will be made, whether there is a limit to the value of cash reimbursements that will be made (eg $50).
  

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Related Policies

• Related policies

  You may have some other policies that need to be taken into account when considering the Expenses Policy. Examples of policies that may be related to the Expenses Policy are:
  
  

  Policy	Example of reason for relationship …
  Code of Conduct	may contain requirements for being ethical in all dealings.
  Travel policy	may provide for a per diem to be paid, rather than employees being reimbursed for expenses while travelling.
  Vehicle policy	may specify all fuel purchases are to be made using a fuel card and prohibit reimbursement for fuel paid for by an employee.
  Drug and alcohol policy	may prohibit the purchase of alcohol with company money.

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This document has been prepared by the law practice Law Central Legal