Accounting
Workers Losing $10.7 Billion in Unclaimed Expenses, Says Report
A number of reasons were cited for failing to claim expenses including low value, forgetting to ask for receipts, losing receipts or simply forgetting to submit the expense claim. One in three employees say they refrain from submitting expense claims ...
Dec. 02, 2015
North American employees are losing out on more than $10.7 billion of unclaimed expenses every year, two-thirds of the $15.5 billion globally. An independent multi-national research study into expense claims found that poor expense claim processes lead to employees not always claiming expenses they have incurred, having a negative impact on employee engagement.
Commissioned by Unit4, a developer of enterprise applications for service organizations, the survey was conducted by Ruigrok | NetPanel in August 2015. Researchers surveyed senior and middle management professionals who are employed full and part-time, and who submit expense claims in the US, Canada, United Kingdom, Spain, France, Netherlands, Germany, Belgium and Sweden. The findings are based on responses from almost 2,000 employees with at least 200 responses from each country.
A summary of key findings are:
|
North American employees: |
US |
Canada |
|
Regularly don’t expense everything |
17% |
23% |
|
Lose an average per year |
US$390 |
US$284 |
|
Lose a total average per country |
US$9.7 billion |
US$1 billion |
|
Are frustrated with employers’ expense processes |
32% |
27% |
|
Wait over one month for payment |
10% |
13% |
|
Left short while waiting for expense claims |
37% |
20% |
|
Feel financially taken advantage of through expense claim process |
42% |
21% |
A number of reasons were cited for failing to claim expenses including low value, forgetting to ask for receipts, losing receipts or simply forgetting to submit the expense claim. One in three employees say they refrain from submitting expense claims because the process is too frustrating and time consuming. The same amount have to wait for more than one month for their expenses to be paid after making a claim, though overall most expenses are paid within a month.
Corporate expense claim processes do not support employee engagement initiatives to the extent that companies are leaving employees short of money. Two out of five (37%) US professionals who regularly claim expenses say this is the case, with those in France (24%), Spain (23%), the UK (23%) and Canada (20%) reporting find themselves short of money.
Many North American professionals feel they are being financially taken advantage of by their employers. When asked if they feel their employer is gaining a financial advantage over them through the expense claim process, 42% of US respondents said yes. In Spain (29%) and Sweden (26%), the UK (25%), France (23%), Canada (21%) and Belgium (20%) agreed, compared to only 10% in Germany and the Netherlands. Of the employees surveyed that said yes, 28% (average across countries) feel this has a negative influence on their feelings towards the company.
“The one thing that creates sustainable competitive advantage and long-term strength for a company is the workforce. The people are the company. Research shows that employees who are engaged significantly outperform those who aren’t,” said Kara Walsh, Chief Human Capital Officer at Unit4. “While employee engagement is driven by many factors, the companies that provide a caring and open workplace environment will win today’s war for talent. With recruiting costs running approximately 1.5 times annual salary, the ability to engage and retain valuable employees has a significant impact on an organization’s bottom line.”