Denying incurred expenses if submitted ‘late’?

[pincher]

Looking for some advice on this one - my other half works in Events on a self-employed basis but does a lot of work through one particular agency (although not exclusively). She had to sign up with them on a PAYE basis earlier this year for a reason that I’m still not too clear on but that’s not the crux of this post.

She gets jobs based on experience and in many cases, because she is specifically requested - the Agency (usually) sends out a brief, along with rate and what expenses/per diems they can claim. She doesn’t have to invoice for the jobs as this is managed by the Agency but she does have to submit an expenses form for the jobs she has worked for them in a calendar month. She had an email from them last week, stating that if the expenses aren’t submitted by the 10th of the following month, then they are forfeited completely as the owner “can’t be bothered to keep chasing people up”. This doesn’t sit well with me, as I think it is fairly harsh and wondered if they Agency are actually allowed to do this? I guess it depends on what is in her Contract (still need to find this out) but if your booking brief says expenses e.g. travel are allowed and incurred, can the Agency just decide not to pay them?

Also, the allowed expenses are often less than my other half incurs (i.e. her travel costs are more than she is allowed to claim for the job)

I think I would have more empathy if they said 30 days as a cut-off but what if someone misses the deadline because they have gone on holiday for a fortnight or three weeks? I know you could argue that they should have submitted before they went away but that isn’t always practical.

I should point out that the Agency charges the end-Client for expenses on a basis that is more beneficial to them that the worker (read into that what you will) and I can’t imagine for a minute that they wouldn’t charge, even if they didn’t pay the person who incurred them - I’d say that was bordering on fraud?

I might be barking up the wrong tree on this entirely and they are perfectly entitled to act in this way?

[Gargamel]

pincher said:

Looking for some advice on this one - my other half works in Events on a self-employed basis but does a lot of work through one particular agency (although not exclusively). She had to sign up with them on a PAYE basis earlier this year for a reason that I’m still not too clear on but that’s not the crux of this post.

She gets jobs based on experience and in many cases, because she is specifically requested - the Agency (usually) sends out a brief, along with rate and what expenses/per diems they can claim. She doesn’t have to invoice for the jobs as this is managed by the Agency but she does have to submit an expenses form for the jobs she has worked for them in a calendar month. She had an email from them last week, stating that if the expenses aren’t submitted by the 10th of the following month, then they are forfeited completely as the owner “can’t be bothered to keep chasing people up”. This doesn’t sit well with me, as I think it is fairly harsh and wondered if they Agency are actually allowed to do this? I guess it depends on what is in her Contract (still need to find this out) but if your booking brief says expenses e.g. travel are allowed and incurred, can the Agency just decide not to pay them?

Also, the allowed expenses are often less than my other half incurs (i.e. her travel costs are more than she is allowed to claim for the job)

I think I would have more empathy if they said 30 days as a cut-off but what if someone misses the deadline because they have gone on holiday for a fortnight or three weeks? I know you could argue that they should have submitted before they went away but that isn’t always practical.

I should point out that the Agency charges the end-Client for expenses on a basis that is more beneficial to them that the worker (read into that what you will) and I can’t imagine for a minute that they wouldn’t charge, even if they didn’t pay the person who incurred them - I’d say that was bordering on fraud?

I might be barking up the wrong tree on this entirely and they are perfectly entitled to act in this way?

I think they are perfectly entitled to act this way. They can certainly ivoice the client for expenses at one rate, and pay expense to the employee at another. See any consulting firm for details.

The timing etc I have no problem with, however if they are not fully re imbursing her for the actual cost of the trip - then I am not clear why. That would be my only issue

[Mr Pointy]

I've some experience of this from the managers side of the fence & I have to say I have some sympathy with them. It can be incredibly time consuming chasing people for expenses & time sheets & it's totally lost unproductive time. I too instigated a rule that if claims weren't in by a certain deadline (it was quite generous) then they were lost. After a couple of occasions you can be sure no-one was late submitting again.

Not paying all the expense incurred however is wrong. I wouldn't accept that.

[Eric Mc]

Is she claiming the expenses as an employee?

If so, what does her employment contract say?

[Marcellus]

Is the rationale behind it that once the agency has invoiced the client for the job (including expenses) then they can't keep going back for a bit more, a bit more, a bit more...... would seem very unprofessional for them to if they were.

In which case yes I understand and probably agree with the Agencies line, get them in within the 1st week of the month, collate and send invoices out 2nd week of the month, receive payment sometime and then refund to employee! That said they'd probably be refunding to employee before money in from client!

[Du1point8]

we used to get people hanging on to expenses for 3+ months, then the 3 month rule came out, the same people would hang on to the expenses until week 11, now work has got so fed up that if its not submitted within a month, the claimant loses the ability to claim without mitigation from the head of accounts.

Some people have ruined it for the masses and I can completely see why as it only takes 30 mins to enter a 2 weeks of expenses and its done.

[ATG]

In my experience the reason that expenses are submitted late is because most firms make claiming them into such a spectacularly bureaucratic ballache. Hours of time wasted processing a receipt for an M&S ham sandwich bought by an individual on a 6 figure salary is somehow considered normal. The whole area of corporate travel and accommodation is a cess pool of normalised petty corruption (loyalty points and air miles) and incompetence. Shoot the lot of them. Twice.

[Du1point8]

ATG said:

In my experience the reason that expenses are submitted late is because most firms make claiming them into such a spectacularly bureaucratic ballache. Hours of time wasted processing a receipt for an M&S ham sandwich bought by an individual on a 6 figure salary is somehow considered normal. The whole area of corporate travel and accommodation is a cess pool of normalised petty corruption (loyalty points and air miles) and incompetence. Shoot the lot of them. Twice.

Or to cover it easily... let the Juniors pay and claim using the horrible method. Let the management staff have bloody corporate cards as we are less likely to fk with them and I can put everything on that then its a quick check online to accept or decline everything.

[Countdown]

ATG said:

In my experience the reason that expenses are submitted late is because most firms make claiming them into such a spectacularly bureaucratic ballache. Hours of time wasted processing a receipt for an M&S ham sandwich bought by an individual on a 6 figure salary is somehow considered normal. The whole area of corporate travel and accommodation is a cess pool of normalised petty corruption (loyalty points and air miles) and incompetence. Shoot the lot of them. Twice.

Indeed, and as somebody who writes expenses policies I shall try to explain why

They have to cater for the lowest common denominator so the rules have to be simplistic and a bit"Computer says NO".
They have to ensure value for money (to the company, not you)
They need to be enough to cover the essentials but not for employees to take the mick so limits are imposed.
They need to ensure the company complies with HMRC rules.
The money the Employee is spending isn't "theirs", it's the Owners/Shareholders who want to know what it's been spent on and why, and they want proof that it's only been spent on stuff that they have approved This requires detailed record keeping.

I'd expect people on a 6-figure salary to have a Corporate CC to be honest but you would still need receipts. It's really not THAT hard to have a slot in your wallet to store them. And equally, if you're on a 6 figure salary would you be that bothered about claiming for an M&S ham sandwich?

[Jasandjules]

What does her contract say about expenses?

[pincher]

Thanks for the replies - I’m on my phone so will try to respond as best I can to points and questions raised. Apologies for any typos

Gargamel said:

I think they are perfectly entitled to act this way. They can certainly ivoice the client for expenses at one rate, and pay expense to the employee at another. See any consulting firm for details.

The timing etc I have no problem with, however if they are not fully re imbursing her for the actual cost of the trip - then I am not clear why. That would be my only issue

Really? Never knew that. I know that I never claim expenses for a higher value that I have spent.

As for the not fully reimbursing bit, I think it is a case of she is allowed £x as part of the job , the Agency invoices the end-Client £x+y but her actual expenses can ben £x+y+z (and is usually down to the fact that a lot of her work is in London and it costs more to travel than the Agency (and end-Client) allow).

Mr Pointy said:

I've some experience of this from the managers side of the fence & I have to say I have some sympathy with them. It can be incredibly time consuming chasing people for expenses & time sheets & it's totally lost unproductive time. I too instigated a rule that if claims weren't in by a certain deadline (it was quite generous) then they were lost. After a couple of occasions you can be sure no-one was late submitting again.

Not paying all the expense incurred however is wrong. I wouldn't accept that.

As I said in my OP, I don't think that a longer period in which to submit is unreasonable but I just think that 10 days from month end isn't particularly reasonable - it's not like they have to impose such a short timescale due to payroll issues - any work she does for in, for example, September, isn't payable until the mid-November payroll run - therefore I think that 21 days to submit is more than acceptable.

Eric Mc said:

Is she claiming the expenses as an employee?

If so, what does her employment contract say?

Her contract says it governs her engagement from time to time as a casual worker and that each offer of work shall be treated as a separate and severable assignment and that there shall be no relationship between the partieds after the end of one assignment and the start of the next assignment.

Marcellus said:

Is the rationale behind it that once the agency has invoiced the client for the job (including expenses) then they can't keep going back for a bit more, a bit more, a bit more...... would seem very unprofessional for them to if they were.

In which case yes I understand and probably agree with the Agencies line, get them in within the 1st week of the month, collate and send invoices out 2nd week of the month, receive payment sometime and then refund to employee! That said they'd probably be refunding to employee before money in from client!

The expenses amount is fixed at the time the job is assigned, so I don't think there is any notion of going back for a bit more. The Agency will claim the expenses from the end-Client at their agreed rate, irrespective of whether those expenses end up being paid to the worker or not, which sticks in my craw. And I don't think that the end-Clients would be too happy if they found that was the case either.

[pincher]

Jasandjules said:

What does her contract say about expenses?

It doesn’t seem to mention them at all.

[StevieBee]

If the expenses she incurs relate in full or in part to specific projects, then the company needs to know what they are before they invoice the client. As she is paying up front herself, they will not know what expenses have been incurred until a claim has been submitted and if the claim falls after the last client invoice, they may not be able to invoice anything more, or choose not to for fear of being seen as inefficient.

Late claims can also play havoc with cashflow, tax calculations and even final year-end figures.

It is entirely reasonable for a company to impose deadlines such as this. As she is now PAYE, the requirements should be set out in the employment contract or appended to it.

As for partially reimbursed expenses, providing the claim has be submitted as per contracted requirement, then no company may withhold properly incurred expense reimbursement.

pincher said:

She had to sign up with them on a PAYE basis earlier this year for a reason that I’m still not too clear on

HMRC have and continue to tighten up on previously freelance workers who didn't meet the indicators for such arrangements. Hefty fines for the non-compilant companies.

[pincher]

I guess you could infer that the expenses are relative to a specific project, in that it will always relate to that particular event. The Agency will invoice the end-Client for the staff supplied at a set day-rate plus expenses at a set rate (no receipts required to be submitted), so there would be no issues with regards to the workers submitting their expenses to the Agency late. It is also quite possible that the Agency will receive payment from the end-Client before they pay the works, so again, potentially no real issue with cashflow for the Agency.

I agree with your point about imposing deadlines and I (we) don’t have a problem with this - it is more to do with the fact the deadline is (IMO) unreasonably short and that the owner can’t be bothered to remind people that the deadline to submit is near. It’s probably a 10 minute job to set up a recurring email to all workers to ask them their expenses in a timely manner.

Your penultimate sentence is interesting - is there any more info you can provide on that, or is it just an opinion? I presume the individual job ‘offer’ with details of hours, location, rate and allowable expenses would constitute a contract? Unfortunately, there is no mention of expenses on the main ‘contract’, let alone any mention of submission deadline.

[Jasandjules]

pincher said:

Jasandjules said:

What does her contract say about expenses?

It doesn’t seem to mention them at all.

Then ask them where in the contract does it mention a cut off date for expenses properly incurred.......... And perhaps note you look forward to their being paid in the next payment run...

[MKnight702]

pincher said:

Also, the allowed expenses are often less than my other half incurs (i.e. her travel costs are more than she is allowed to claim for the job)

Can you please expand a bit more on this. There can't be many examples where you shouldn't claim back expenses incurred for the business. Unless it is something like travelling first class as opposed to standard fares or eating out at Michelin star restaurants rather than the local pub, which I can understand then surely you should be able to claim all reasonable expenses. If you can't then you may be able to claim tax relief from HMRC but you will need to keep scrupulous records.

[Sheepshanks]

pincher said:

Gargamel said:

I think they are perfectly entitled to act this way. They can certainly ivoice the client for expenses at one rate, and pay expense to the employee at another. See any consulting firm for details.

The timing etc I have no problem with, however if they are not fully re imbursing her for the actual cost of the trip - then I am not clear why. That would be my only issue

Really? Never knew that. I know that I never claim expenses for a higher value that I have spent.

How did you get that from what he wrote?

And agree with others that it's perfectly standard for a company to charge expenses to a customer that are higher than it allows its employees to claim.

[pincher]

Yeah, I didn’t word that very well did I?

I was trying to say that, as a Contractor, when I send my expenses invoice into my payroll agency, I wouldn’t expect them to add another %age on top when they invoice the end Client.

But from what you guys say, it’s fairly common so more than happy to be educated on that

My gripe (well, one of them) is that the Agency invoices the end Client for expenses, irrespective of whether they get paid to the worker because that person didn’t submit their sheet on time. So the Agency benefits financially and penalises the worker.

[pincher]

MKnight702 said:

pincher said:

Also, the allowed expenses are often less than my other half incurs (i.e. her travel costs are more than she is allowed to claim for the job)

Can you please expand a bit more on this. There can't be many examples where you shouldn't claim back expenses incurred for the business. Unless it is something like travelling first class as opposed to standard fares or eating out at Michelin star restaurants rather than the local pub, which I can understand then surely you should be able to claim all reasonable expenses. If you can't then you may be able to claim tax relief from HMRC but you will need to keep scrupulous records.

Hopefully, I covered tht in an earlier reply?

But to reiterate, she gets the offer to work at an event for a set fee (plus agreed overtime rate, if applicable). The offer also details the expenses that she can claim, up to a maximum amount. The Agency will have pre- agreed with the end Client the expenses amount that they will charge, per worker (plus the daily rate obviously). If the workers expenses are more than the amount t that the offer stated they can claim, then this is basically tough luck on the worker. It’s great for those living in London, who do the jobs in London but not so great for those that live outside London as the travel cost is often substantially more than the expenses they can invoice for.

Hope that makes sense?

[ATG]

Du1point8 said:

ATG said:

In my experience the reason that expenses are submitted late is because most firms make claiming them into such a spectacularly bureaucratic ballache. Hours of time wasted processing a receipt for an M&S ham sandwich bought by an individual on a 6 figure salary is somehow considered normal. The whole area of corporate travel and accommodation is a cess pool of normalised petty corruption (loyalty points and air miles) and incompetence. Shoot the lot of them. Twice.

Or to cover it easily... let the Juniors pay and claim using the horrible method. Let the management staff have bloody corporate cards as we are less likely to fk with them and I can put everything on that then its a quick check online to accept or decline everything.

I really wish that were the case, but we go through the same mad hoops even when we've used the corp cards ... which of course are Amex, and therefore regularly refused.