HR glossary / P / Per diem

Per diem

Definition

In the context of HR, a “per diem” refers to a daily allowance given to an employee for a business trip, intended to cover expenses related to meals, accommodation, and other incidental costs that might arise during the journey. The primary purpose of the per diem is to compensate the employee for the additional expenses they have to bear due to the business travel.

The per diem rate can be established in a company’s internal policies, collective agreements, or other relevant documents. In many countries, including Poland, there are also legal provisions that specify the minimum per diem rates. It’s essential to ensure that per diems are granted in line with the prevailing regulations and market realities.

The amount of the per diem can vary based on the destination (whether domestic or international) and the duration of the trip. For international trips, per diem rates are often higher, reflecting the differences in the cost of living between countries.

FAQ

Does the per diem cover all expenses related to a business trip?

Not always. The per diem is intended to cover basic expenses associated with the trip, but some costs, such as accommodation, might be billed separately.

It depends on the company’s internal policies. Often, the per diem is a fixed amount given regardless of actual expenses, but there might be situations where the employer requires receipts.

If an employee has received a per diem and the trip did not take place, they are typically required to return the money.

Uses

Financial support during trips

The per diem provides employees with funds to cover the basic costs of the trip.

Motivating employees

Attractive per diem rates can encourage employees to undertake business trips more frequently.

Simplification of settlements

Fixed per diem rates eliminate the need for complicated individual trip reconciliations.

Maintaining transparency

Clearly defined rules regarding per diem allocations prevent misunderstandings and ambiguities.

Compliance with regulations

Granting per diems by current laws ensures legal security for the company.

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HR glossary / P / Per diem

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