Benefits of Per Diem Services

Per diem services are a way for companies to reimburse employees for out-of-pocket expenses while traveling on business. These services can range from providing a standard meal allowance to covering accommodation expenses and even airfare. Companies use different strategies to manage their per diem payments, including issuing credit cards, offering full or partial expense coverage and setting fixed daily rates.

A common use of per diem payments is to support health workers who travel or work in difficult environments. These workers may have to stay in remote locations with limited infrastructure or where food and shelter are expensive. A per diem policy can help alleviate their costs, promote professional development activities, and encourage them to keep doing their work under challenging circumstances.

Regardless of the purpose, per diem services can be costly to companies and may also create a negative organizational culture where people expect to get paid for every activity. They can also lead to changes in allocation of time and neglect of management tasks or other services that are not linked to allowances. The abuse of per diems can also involve manipulating work practices to gain financial gains (slowing work, over-scheduling trainings, creating temporary employment for friends or relatives to gain additional monetary benefits, and other fraud).

As such, it is critical that organizations review their per diem policies regularly in order to ensure they remain aligned with official government guidelines. They should be flexible enough to accommodate changes in travel patterns, and they should allow for an easy reimbursement process without requiring extensive recordkeeping and paperwork.

Companies can also consider implementing an expense tracking application that simplifies the per diem reimbursement process and allows employees to keep tabs on their expenditures in real-time. This can also reduce the amount of time needed to process reports and can limit errors. In addition to reducing the cost of per diems, using an expense monitoring tool can also improve employee morale by allowing them to focus on achieving their goals.

The General Services Administration (GSA) sets standard meal and incidental (M&I) rates for different regions of the country, based on various factors like local prices. Many organizations will also set their own M&I rates to address unique needs and policies. This information can be used to establish maximum per diem rates for each location and category of travel, so that employees know what limits they are operating within. A per diem tracking application can also help to keep track of other expenses related to a business trip, such as transportation and accommodation. It can provide a clear picture of an employee’s per diem spending and help them plan accordingly for future trips. This is especially useful when working with travel nurses or other contract or temporary workers who often travel for their jobs. These types of workers usually do not receive a consistent salary, and they must be able to budget their own expenses and travel plans accordingly. In these cases, it is important to communicate the appropriate travel budget and maximum per diem rates to employees during onboarding.