Reimbursement Definition:

Reimbursement, in the context of employment, refers to the process by which employees are compensated for expenses incurred while performing job-related duties. These expenses may include travel costs, accommodation, meals, or other expenditures directly associated with work responsibilities.

Key Features of Reimbursement:

  • Expense Coverage: Reimbursement covers a range of business-related expenses that employees may incur during the course of their work, ensuring that financial burdens are not solely borne by the individual.
  • Submission and Approval Process: Typically, employees are required to submit receipts or documentation of incurred expenses, which then undergo an approval process by the employer or designated personnel.

How Does Reimbursement Work:

When employees engage in activities that necessitate spending on behalf of the company, they retain the right to seek reimbursement. This process involves the following steps:

  • Expense Incurrence: Employees incur eligible expenses while carrying out job responsibilities, keeping detailed records such as receipts or invoices.
  • Submission: The employee submits a reimbursement request, detailing the expenses incurred and providing supporting documentation.
  • Approval: The employer or relevant department reviews the submission, ensuring adherence to company policies, before approving the reimbursement.
  • Payment: Once approved, the reimbursed amount is paid to the employee, either through direct deposit, payroll, or another designated method.

Best Practices of Reimbursement:

  • Transparent Policies: Employers should establish clear and transparent reimbursement policies, outlining eligible expenses, submission procedures, and approval criteria.
  • Timely Processing: To enhance employee satisfaction and financial planning, reimbursements should be processed promptly, minimizing delays in compensating incurred expenses.


Common eligible expenses include travel costs, accommodation, meals, transportation, and other expenses directly related to work duties. Employers may specify eligible categories in their reimbursement policies.

Yes, reimbursement policies are not one-size-fits-all and can vary between companies. It is essential for employees to familiarize themselves with their company's specific reimbursement guidelines.

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