Travel & Business Expense Policy and Procedures

The University’s office communications system and equipment, including office telephones, are provided for the conduct of official University business. Use of this equipment for personal business should be kept to a minimum. If more than de minimis personal use occurs, a record of such use must be kept and repayment made to the University. Supervisors are responsible for preventing abuse and ensuring that repayment is made if necessary.

The determination of whether an employee requires a mobile communications device and the availability of University funding for such support is at the discretion of the employee’s organizational unit management that is at or above the Dean, Vice Provost or Associate Vice President level. If an employee believes that he or she requires a mobile communications device in order to perform his/her duties, he/she must provide a business expense justification that meets the IRS business purpose tests on a Mobile Device Support Form (Exhibit A). Mobile communications devices are defined as devices with access plans for connection, such as cell phones and smart phones.

Mobile communications devices are allowable only in situations in which the employee’s business needs cannot be accommodated by the use of a conventional telephone or other less expensive communications device. Purchase of a mobile communications device merely for the convenience of the employee does not satisfy the IRS business purpose test.

Mobile communications devices are not allowable for the purpose of promoting goodwill, boosting morale, providing additional compensation, or attracting prospective employees.

Examples of IRS-compliant business purposes for a mobile communications device include:

• the need to contact the employee at all times for work-related emergencies
• the requirement that the employee be available (i.e. “on-call”) to speak with donors, applicants, or students at all times when the employee is away from the office
• the need for business conversations with individuals in other time zones at times outside the employee’s normal work day

A general business need to remain in contact with the University or to monitor ongoing communications related to one’s duties is not a sufficient standard for exclusion from taxes. Without specific evidence that the employee’s job duties meet IRS requirements for a device, the presumption is that all reimbursements and allowances for mobile communications devices are taxable income to the employee.

There are three options for reimbursement of mobile communications device expense, the preferred approach may be set at the organizational level by the Dean, Vice Provost, Associate VP or Vice President:

1) Non-taxable allowance for employee-owned device and service plan

• University funds may provide a monthly subsidy to employees who meet the above IRS criteria in order to cover the additional business expense that the employee incurs on their personal cell phone plan. Subsidies will be processed as an out-of-pocket reimbursement through the OneCard system. The dollar amount of the allowance should cover the employee’s anticipated additional business-related expenses, including the cost of basic equipment (as defined in advance by the Unit Head in consultation with his or her business manager). Equipment upgrades or usage unrelated to University business use must not be considered. Appropriate subsidy amounts should be set by the organizational Unit Head and should be reviewed on an annual basis. Monthly subsidies should equal the cost of one line under the terms of the current University cell phone contract. Subsidies in excess of this amount should be justified based upon extraordinary business need. The employee’s cell phone bill should be provided at the time the subsidy amount is determined and renewed.

2) University-owned device and service plan

• University funds may pay for an employee’s mobile communications device and enrollment in the University cell phone plan. University support is limited to the cost of basic equipment (as defined in advance by the Unit Head in consultation with his or her business manager). Equipment upgrades beyond basic should be paid from personal funds. Plan service levels should be consistent with the employee’s anticipated business use. Departmental management should monitor the cell phone usage and the employee’s business responsibilities at least annually to ensure that the charges are reasonable and that job responsibilities continue to meet the IRS criteria. University-owned devices are property of the University.

• When the employee separates from the University, or transfers to a different organization within the University, his or her supervisor shall immediately deactivate the employee’s account and the employee must either purchase the cell phone at fair market value or return the equipment to the University.

3) Occasional reimbursement for business use of a personal device

• If the employee’s job responsibilities do not regularly meet the IRS criteria for non-taxable University support, but the employee occasionally exceeds his/her base service plan and incurs additional charges as a result of unusual business-related usage, the employee may submit a reimbursement request for the additional charges.

• Employees receiving standard subsidies may also submit an occasional reimbursement request when they incur additional usage charges as a result of extenuating circumstances, such as international business travel. A copy of the employee’s service plan bill, detailing the additional charges must accompany the reimbursement request.

It may be prudent for organizations to consider purchasing organization-assigned devices to be checked out by individuals as needed, as an alternative to individually supported devices.

Note:  The Banner expense account code for wireless service plans is 72440.  The Banner expense account code for mobile device equipment is 73320. 

Employees are responsible to take reasonable care of their mobile communications device, securing them at all times.  If an employee’s device is lost, damaged or destroyed through negligence, the employee may be required to repair or replace it at their expense, at the discretion of the manager that approved their device.

Employees are responsible to immediately report any loss or theft of a University-supported device.  If an employee has enabled either a “locater” application or a “remote wipe” application for their device and require assistance when it is lost or stolen, contact Lehigh’s Information Security Office.

Purchase of accessories and “apps” for University-owned devices may be supported with University funds if integral to the employee’s ability to use the device for its intended business purchase.  Accessories for University-owned devices should be purchased through the University cell phone plan in order to benefit from the negotiated discount.  Accessories and “apps” for personally-owned devices should not be purchased with University funds.

University support of mobile communication devices for nonexempt staff should be limited and with a business need approved by the Human Resources Office in order to ensure compliance with employment laws governing nonexempt staff work hours and compensation.

Mobile communications devices may not be charged to a grant index unless the device is fully devoted to the project, necessary for the project, included in the approved budget, and approved by the Office of Research.

Employees are reminded that they should not use a mobile communications device to conduct University business while operating a motor vehicle unless the device is “hands-free”.

Departments are prohibited from establishing any arrangements for the reimbursement of home internet charges. Special situations may be addressed via the “Exceptions” provision of this policy statement.

The use of University funds to purchase tablet devices may be allowable with justification of the predominant business need (see Mobile Device Support Form (Exhibit A)). Purchases must follow LTS guidelines for information security and technology compatibility.

Tablet devices may not be charged to a grant index unless the device is fully devoted to the project, necessary for the project, included in the approved budget, and approved by the Office of Research.

Employees have an obligation to use their wireless communications services in a responsible, informed and safe manner, conforming to network etiquette, customs, courtesies, safety practices and any applicable laws and regulations. Wireless communications are not secure and employees should use discretion in relaying and storing information on their devices.

All mobile devices that store or process Lehigh University confidential information, regardless of whether they belong to or are paid for by the University, must:

• Have a passcode of at least 4 digits
• Have device encryption enabled
• Be configured to self-erase after 10 consecutive bad passcode attempts
• Have remote-wipe capability enabled
• Have a screen lock with maximum of 5 minute inactivity period

Pursuant to federal law, whenever the University is sued or reasonably anticipates that litigation may be commenced, it must take actions to preserve all electronically stored information that may be relevant to the claim.  This requires the University to suspend the deletion, overriding, or any other destruction of electronic information relevant to the dispute that is under the control of the University.  This includes all forms of electronic communications – e.g., email, word processing, calendars, voice messages, videos, photographs, etc. wherever it is stored, including on mobile communication devices.  This electronic information must be preserved so that it can be retrieved – if necessary – at a later time in connection with the lawsuit.  Consequently, mobile communication devices used to conduct University business, whether owned by the University or the individual, may be subject to these preservation rules.

Fees for WIFI access devices and service fees (ex: Aircard, MIFI) are allowable if purchased for the purpose of conducting University business while traveling. Purchase of accessories and “apps” for University-owned devices may be supported with University funds if integral to the employee’s ability to use the device for its intended business purchase. Accessories for University-owned devices should be purchased through the University cell phone plan in order to benefit from the negotiated discount.  Accessories and “apps” for personally-owned devices should not be purchased with University funds.

Certain department and stem functions, such as holiday parties, retirement parties, and other significant departmental gatherings, serve an important business purpose for the University in supporting morale and encouraging networking amongst colleagues. It is important that all Financial Managers give proper consideration of the University’s fiduciary responsibilities when planning these functions. Proper consideration should be given to including all employees within the organizational unit and others as appropriate for the business purpose. The frequency of departmental functions should not exceed a maximum of four functions per fiscal year, and in many cases should be less. College or Stem administration may establish different frequency levels for selected areas within their organization.

Departmental and Stem function expense must be reasonable to the business purpose. The per-person cost of the event may not exceed the published Meal and Incidental per diem reimbursement rate for that meal (see “Per Diem Reimbursement of Meals and Incidentals”). For example the dinner per diem would be 55% of the daily Meal and Incidental per diem rate (for example, this translates to $32.45 per person in Bethlehem, June of 2016). The per-person cost for a reception should not exceed 35% of the daily Meal and Incidental per diem rate (for example, this translates to $20.65 per person in Bethlehem, June of 2016). Occasionally, additional costs may be incurred for the provision of limited alcohol service if consistent with the terms of the University alcohol policy and appropriate for the nature of the event. Any additional costs for the function should be reimbursed personally.

All faculty and staff below the Dean, Vice President or equivalent level must obtain approval of their Dean or Vice President prior to committing any University funds for a function.

If alcohol will be served at the function, prior approval must be obtained in all instances from the Dean, Vice President or equivalent level and the event must comply with the University’s alcohol policy (see the link on the Auxiliary Services and Controller’s Office websites). In addition, Provost approval is required for the purchase of alcohol for student meals or events. Prudence should be used in the purchase of alcoholic beverages as they may comprise a significant portion of the cost of a meal. Complete documentation of the attendees and business need for alcoholic beverages must be documented. Documentation of all approvals is required.

Refer to the Gifts and Flowers section of this document for information on bestowing gifts to faculty or staff at functions.

Financial support to graduate and undergraduate students that is not processed through the Office of Financial Aid or the Bursar’s Office should be reported to Accounts Payable on a “Lehigh University Student Disbursement Form”. Financial support includes the reimbursement or direct payment of a student’s travel or other expenses for the individual student’s educational or personal needs.

Generally, it is allowable to reimburse visiting lecturers and other official visitors who are nonresident aliens for expenses incurred in connection with their travel to the University. IRS regulations however, preclude the payment or reimbursement of travel expenses to foreign visitors who arrive in the U.S. with certain visa types. See “Payments to Foreign Visitors” in the Accounts Payable - Procedures section of the Controller’s Office website.

Note: Contact Accounts Payable regarding visa requirements and related documentation prior to making travel arrangements for foreign visitors through the University’s travel management company or any other vendor. Honorarium payments to foreign visitors must be requested on an Accounts Payable Payment Request form and should not be charged on a OneCard.

Employee gifts and awards for outstanding achievement, length of service, retirement, and morale building are administered through the Office of Human Resources and the Payroll Office in order to ensure consistency, appropriateness of funding resource and proper taxation to the employee.

Arrangements for tangible expressions of sympathy from the University are provided by the President’s Office upon request.

Gifts or flowers to any University employee for any purpose other than those provided through these official University recognition programs are unallowable. Deans and Vice Presidents have discretion to determine whether flowers are appropriate in certain cases for University events or where institutional representation is important.

On occasion, a department or supervisor may wish to bestow a holiday, retirement, or other appreciation gift on his/her staff or other employees at the University. It is appropriate to use personal funds for such gifts. Similarly, it is appropriate to spend personal funds in recognition of employees for non-work related achievement or events such as weddings, baby showers, etc. or to purchase holiday gifts. University funds are to be used for activities that directly support the operations of the department in the core teaching and research mission, thus it is not appropriate to use University funds for purchasing gifts.

In general, appreciation gifts for students should also be purchased with personal funds. Infrequent de minimis tokens of appreciation may be provided to students who are not employees and volunteers if it is not in the form of cash, gift card, or gift certificate and the value of the item is less than $50.

According to the IRS, any property or service (or cash) that an employee receives from the University instead of, or in addition to, regular taxable wages is taxable compensation unless specifically excluded. Noncash gifts are valued at fair market value. Contact the Payroll Office for a determination on taxability of any noncash gift. Gifts to employees in the form of cash, gift cards or gift certificates purchased with University funds are generally taxable compensation and must be communicated to the Payroll Office.

Employees are defined for this purpose as anyone paid through the Payroll Office for his/her services to the University, including all employees on the semi-monthly and monthly payroll and temporary wage employees. The above policy terms do not apply to gifts or celebratory events for donors, alumni who do not hold University appointments, or honorarium arrangements for guest speakers. Token gifts of insubstantial value are allowable for donors, alumni or guest speakers with proper business justification, but cannot be in the form of cash, gift card, or gift certificate.

Refer to “Department and Stem Functions” for information regarding work-related departmental celebrations, meals and functions.

The University may reimburse moving expenses for newly recruited employees based on the terms of the University Moving Expense Procedures found in the Payroll and Tax sections of the Controller’s Office web page. The Moving Expense Summary Form and related documentation must be submitted for processing under the terms of the University Moving Expense Procedures.

ORSP: Research and Sponsored Program Moving/Relocation Expenses

Relocation Expenses are allowable for research personnel recruited for work on a sponsored program, assuming the following conditions are met:

1. The move is for the benefit of the employer.
2. Reimbursement is in accordance with the University Moving Expense Procedures.
3. The reimbursement does not exceed the employee’s actual expenses.

You must consult with your Contract and Grant Specialist for guidance on what costs are allowable on the grant prior to incurring Relocation Expenses.

Payments for personal services must be paid directly by the University to the individual or firm by requesting payment using an Accounts Payable Payment Approval form. Do not use your OneCard or request reimbursement for the payment of honorariums, fees, commissions, prizes, awards, rents, royalties, or any other compensation paid to individuals or firms for services rendered.

The Commonwealth of Pennsylvania considers all forms of gambling to be illegal unless specifically excepted by law, therefore all University-sponsored contests or drawings that involve prizes must first be reviewed by the Controller’s Office or General Counsel’s Office for compliance with Pennsylvania gambling law via the Prize Support Form on the Accounts Payable website. In addition to complying with Pennsylvania law, all contests must support a valid institutional purpose and must have supervisor approval.

The IRS considers all prizes, including cash, gift cards, gift certificates and non-cash merchandise, to be taxable income to the recipient, regardless of value. The University’s obligation to report the prize to the IRS, or to withhold taxes, depends upon the value of the prize, the recipient’s employment status, and the recipient’s immigration status. Departments that are considering a prize program should first consult with the Controller’s Office for a full explanation of the tax and reporting considerations. The purchase of any approved prize may not be funded through the travel advance process without prior approval of the Controller’s Office. Within five days of awarding any prizes, departments must send the following information to the Accounts Payable department: recipient’s name, address, social security number, purpose of the award, description of the award, and market value of the award. Academic achievement and financial aid awards are separately administered within Academic Affairs.

It is allowable to reimburse prospective employees, guest speakers or lecturers, and consultants for expenses incurred in connection with their business travel to the University. These travel arrangements, payments and/or expense reimbursements made to, or on behalf of, persons other than University employees must comply with the same policies that pertain to University employees. Any guest, visitor or consultant requesting reimbursement but not substantiating expenses as required under this policy or otherwise not eligible for business expense reimbursement will be subject to taxable income reporting on IRS Form 1099 or 1042-S and may be subject to withholding of federal income taxes from the reimbursement.

Funds to support these expenses are generally limited to departmental budgets and/or the terms of contracts and grants. No commitment for reimbursing such expenses should be made without first consulting the appropriate Financial Manager or Authorized Signer to ascertain that such reimbursement is authorized.

Note: Reimbursement for such expenses directly to these individuals can only be made through the Accounts Payable department, by completing the Accounts Payable Payment Approval form and attaching original receipts as provided for in this policy. You may, make travel arrangements for these individuals and pay these expenses directly on their behalf, again by using the Accounts Payable Payment Approval form, or by using the University’s travel management company to make the travel arrangements and charge the appropriate University index directly.

It is not allowable for University employees to pay travel expenses directly on behalf of non-University employees, and subsequently seek reimbursement for expenses incurred personally on their behalf.

In general, trips of less than 50 miles one way do not qualify for University support of an overnight stay.

Lodging expenses incurred during official business travel are allowable. The University provides two distinct methods for lodging expense: actual cost and lodging per-diem.

A traveler may use only one of these methods for the duration of a trip. Unless a per-diem allowance is claimed for the trip, lodging receipts are required. See ORSP:Research and Sponsored Program Lodging, for additional information regarding travel funded by sponsored projects.

Lodging Actual Cost
Travelers should use standard accommodations at reasonably priced hotels and motels when making reservations. Payment or reimbursement of for lodging expense may not exceed the normal rate for a standard single room. When traveling to a conference, it is appropriate to stay at the hotel hosting the conference, assuming that the daily rate is not unreasonably expensive relative to other alternatives.

Lodging per Diem
Receipts are not required when using lodging per-diem. The following rules apply when using the lodging per-diem method of reimbursement:

The University will reimburse lodging expenses based on the per-diem rate for the geographic region where the expense is incurred. Travelers must be able to demonstrate that stay did occur. The University's reimbursement rate for domestic travel is based on the U.S. General Services Administration-maintained Web site of per-diems by geographic area, at: http://www.gsa.gov/portal/category/21287.

New per diem rates become effective on October 1st of each year. If a city is not listed, check to ensure that the county within which it is located is also not listed. Visit the National Association of Counties website at www.naco.org to determine the destination county. If the city is not listed, but the county is, then the per diem rate is the rate for that entire county. If the city and the county are not listed, then that area is considered to be a Standard Location (lowest rate).

The University's rate for foreign travel is based on the U.S. Department of State web site, which lists per-diems by country and locality. If a country is not listed, then use the U.S. Department of State’s “Other” per diem rate.

Lodging per-diems may be claimed for each night away from your home on University business when the destination is at least 50 miles away except where overnight transportation (airplane, railroad, bus, ship or other commercial vessel) is used.

Because rates for specific localities may change as often as every two months, the traveler must be careful to ensure that the applied rate is appropriate to the actual dates of travel.

Business travelers will not be reimbursed for free accommodations awarded in connection with hotel frequent guest programs.

Some sponsored programs set forth per-diem rates for lodging. University employees should follow sponsor’s travel policies where appropriate. Financial Managers should review the terms of the award or consult with their Contract and Grant Specialist prior to incurring charges to the project index.

Commercial air travel expense is allowable on the basis of the actual cost incurred by the traveler using normally traveled routes. All University approved travel will be at the most economical rates, not first class or business class. Coach or promotional fares are the only classes of travel allowed. Non-coach travel can only be utilized with strong business justification and the prior written approval of the traveler’s Vice President or equivalent level, or Provost. Non-coach travel for employees at the Vice President, Provost or equivalent level must be approved by the President’s Office.

Expenditures to stay an extra day for personal reasons are not allowable. Travelers are encouraged to travel a day early or stay a day later when air and overall travel savings can be realized. Otherwise, travelers should schedule their return flight for the day the conference or seminar ends. Additional meals and lodging associated with a longer stays are allowable if such costs are less than the airfare savings resulting from an earlier arrival or later departure. Additional charges for changes to flight arrangements must be reasonable and justification must be included with the traveler’s receipts.

Advance purchase of travel miles (VIP Miles) is not allowable. Lehigh University does not reimburse travelers for tickets purchased with frequent flier miles.

Air carrier selection cannot be biased by any traveler's frequent flyer affiliation. The lowest cost air travel will take precedence over frequent flyer programs. Exceptions may be allowed if the lowest-priced fare would:

• require circuitous routing;
• require travel during unreasonable hours;
• excessively prolong travel;
• greatly increase the duration of the flight;
• result in increased costs that would offset transportation savings;
• be inadequate for the medical needs of the traveler.

Any time a traveler feels the University’s travel management company has not quoted the lowest airfare it should be brought to the reservationist's attention immediately.

Airline reservations made through the travel management company will be direct charged to University indexes. Airline tickets not purchased through the travel management company or OneCard program should not be submitted for reimbursement until after the travel is completed.

When making air travel arrangements, also consider the following:

Baggage
Excess baggage is not allowable unless accompanied by a statement showing that the excess baggage items are necessary for the business conducted or if the trip is for an extended period of time (generally 10 or more days). Should your baggage be lost or damaged, you must notify airline personnel and file a claim with the airline before leaving the airport. Damages and losses that are not covered by the airline may be covered by your homeowner’s /tenant’s insurance. Neither the University nor the University’s insurance will pay for loss or damage to your personal property – you use it at your own risk.

Early Boarding / Preferred Seating Fees
Additional fees for early boarding privileges and/or preferred seating locations are unallowable unless the arrangements are part of a "faculty or staff request for accommodation" plan that was previously approved by the Provost’s Office for faculty and Human Resources for staff. Evidence of the approval should be submitted with the traveler’s airline receipts.

If the traveler takes an indirect route or interrupts a direct route for other than University business, air fare is allowable for either the actual charge or the charge that would have been incurred by traveling the direct route by the most economical means, whichever is less.

Employees, students, or “Agents” of the University may not use personally-owned aircraft or serve as pilot in command or crew member of any aircraft while conducting University business.

If you are planning to charter or lease an aircraft, contact the Office of Risk Management to arrange for proper insurance coverage.

Federal requirements (the Fly America Act) states that domestic grantees must use U.S. flag carriers to the maximum extent possible when commercial air transportation is the means of travel between the United States and a foreign country or between foreign countries. This requirement shall not be influenced by factors of cost, convenience, or personal travel. The detailed implementation practices adopted to conform to the Fly America Act may differ among federal agencies. Accordingly, individuals traveling abroad should consult agency guidelines and/or contact their Contract and Grant Specialist to ensure compliance with the respective agency requirements. Additionally, travelers on foreign trips sponsored by federal funds should use the University’s travel management company and inform the reservationist that they are subject to this Act when making airline reservations.

Use of your personal vehicle is reimbursed at the prevailing Internal Revenue Service mileage rate as listed on the Controller’s Office web page. This mileage rate covers all operating costs including depreciation, repairs, gasoline, insurance, towage and other similar expenditures. Tolls and reasonable parking charges are allowable in addition to the mileage allowance.

In accordance with IRS rules, reimbursement for two or more persons traveling in the same vehicle is limited to the mileage reimbursement paid to the driver/owner of the vehicle. Under normal circumstances, mileage for conducting University business is computed from the University to the destination and return to the University. Mileage for traveling from an individual’s home to work or return is non-allowable commuting expenses. Traffic ticket and parking violation expenses are not allowable.

When making auto transportation arrangements, also consider the following:

University Vehicles
Operation of a vehicle under Lehigh University’s insurance policies is a privilege granted to an individual on a highly selective basis. The Policies and Procedures section of the Transportation Services Department web page contains additional information.

Your primary source for a vehicle for University business should be the Transportation Services Department. If you need a vehicle while traveling, you should contact the University’s travel management company. Lehigh University car share programs are not eligible for business travel.

Auto Insurance Information
The University’s Transportation Services and Risk Management Offices work diligently to provide both vehicles and adequate insurance coverage to protect you, your passengers and the University while traveling. To assist us in this effort, and to ensure that you and the University have adequate insurance protection, it is vital that you obtain vehicles only from authorized sources. Information regarding the University’s negotiated rental car contracts, and the advantages of using those negotiated contracts, can be found on the Purchasing Office website.

Travelers should refer to the Office of Risk Management website for information regarding insurance issues associated with using personal vehicles.

Other Forms of Transportation
For travelers using railroads, non-local buses or other commercial vessels the University will pay the cost of the lowest business-class accommodations available for the trip. Costs should not exceed that of commercial airfare that would be allowable for the same trip.

Local Transportation at Destination
For ground transportation, including airport limousines, courtesy shuttles and taxis, travelers should compare costs of alternate transportation to minimize the cost of ground transportation between airports and hotels or other final grounds destinations.

Rental cars should be used at one’s destination only when absolutely necessary. When rental cars are necessary, travelers should work with the University’s travel management company to use rental companies which provide the lowest rates. Only mid-size or smaller vehicles are permitted, unless there are several travelers within the group. Before rental cars are returned, they should be filled with gas to avoid excessive refill charges from rental companies. The Risk Management Office’s website includes additional information regarding insurance coverage on rental vehicles, and the Purchasing Office website includes information regarding the benefits of using the University’s negotiated rental car contracts.

Lehigh University has contracted a preferred travel management provider. Utilizing the University’s preferred travel management provider allows travel arrangements to be made for Lehigh University employees for a modest transaction fee and offers many advantages for those who choose to use this service.

When arranging international travel through the University’s preferred travel management provider, itineraries will automatically be forwarded to International SOS to ensure the greatest protection and assistance in a crisis situation.

See the Purchasing Office website for additional detailed information on the travel management company, contact information, and the significant advantages that they offer.