Ethics of the Prestige 4th night free
 

Just wanted to extend the discussion over at VFtW regarding the ethics of taking a travel reimbursement and keeping the 4th night free rebate for yourself over here to flyertalk. Thoughts on this?

http://viewfromthewing.boardingarea....-for-yourself/

I consider this to be a credit card reward/benefit just like getting miles/points or cash back. This is a benefit from Citi offered to the cardholder, and the cardholder is paying the annual fee in return for that.

It might be a different story if the employer is paying the annual fee for this card and then expects to reap the benefit, but if the cardholder is paying the annual fee they get the benefits.

If you are getting 2% cash back on your credit card, are you deducing 2% from all expense reimbursements?

Exactly my chain of thought! The only difference here is the amount of rebate you're getting back. But, I know many others beg to differ on their line of ethics, so would be interesting to hear some opposing views.

Ethics of the Prestige 4th night free
 

You might as well surrender your hotel/airline/car rental points and upgrades awards generated from business travel if you think there is an ethical issue here.

The solution is simple from the client/employer perspective. Enforce that business charges should be on a corporate card.

That is what I thought, but if you head on over to VFtW, there are quite a few people saying it is not even borderline and that it is unethical.

That's going a wee bit too far, I think. It's a points-and-miles type of rebate with a receipt for the actual four-night price and a possible rebate a billing cycle or two later. If the hotel just charged you $300 (@$100/night) and said, "Hey, the fourth night's on us," the answer would be different. Sometimes form matters as well as substance.

Here's what I'd call a real rebate issue. You buy an air ticket. You end up cancelling the ticket for a refund and hitching a ride on a private jet instead, for free. You still travelled to the meeting, and the client's not out anything since that ticket price was what it took to get you there.

So do you credit the client and give him the benefit of free air travel? For me, it's not any "issue" at all, ethical or otherwise. Theft is not ok and, yes, you credit the client.

Same scenario. This time ABC airlines flies you for free on one of your legs (SEA-SFO, to be specific) on account of WX. Same "issue." ABC flew you for free; and there's no reason why the client should benefit from that. Same answer. You credit the client.

These scenarios aren't made up. Ah, fun times . . . .

Most Xth night free, such as SPG and FHR, charge you and give you a receipt for the actual amount paid. I think it would be OK if your business purpose for the trip required a three night stay to use this to tack on an additional night for personal purposes (i.e., do some leisure exploration at the destination over a weekend) or to use it to make your life easier by guaranteeing an early check in or late check out by making the reservation include the fourth night.

I guess I could see taking the rebate up to the card's annual fee, as some have argued (assuming that the card is used primarily for business) but only if this didn't have consequences for which particular clients or project accounts were paying the bill.

However, to simply profit personally from the rebate--especially if using it requires paying a higher than necessary rate at the hotel--to me is similar than having your employer pay for a full C/J ticket, refunding it and purchasing a cheap coach ticket, and not attempting to inform your employer or client of the ticket change and decrease in cost. Most employer have systems to prevent this abuse from happening, but it shouldn't be necessary as this behavior to me seems just wrong.

Ethics of the Prestige 4th night free
 

Don't think airline ticket example is a good example. Submitting the airline ticket is stating you used that particular ticket when that is not the case.

The prestige credit is due to form of payment used. For those thinking there is an ethical issue here, then they should be having an ethnical issue with the principle of getting something in return for using a particular form of payment and not the magnitude of the credit and with that in mind they should not be using any reward credit card whether it be airline/hotel/points/cash back etc.

yeah I'm not sure if the airline analogy works..? Since you actually went out of your way to cancel and get a free flight, etc. But the rebate for the citi card is a rebate. If the employer was paying for your credit card it's a different issue, but...

Lots of different trains of thought here, perhaps it's due to different rules per company as well.

This is why big employers force bookings to be made through their agents/platforms so that this kind of issue doesn't flare up much. That way they can better negotiate rebates themselves and keep staff from violating travel policy, and keeping the cookies related to directing spend.

Firms believe that letting staff keep the FF miles from the travel is a gift enough....

Not unethical at all. It's a ~25% rebate. You don't bill people your net cost, you bill them what you paid initially. If it was unethical, it'd be just as unethical to bill the full price of any travel expense instead of the 2+% back you'd get from any other card.

I would say it's unethical to submit a folio for 4 nights of hotel expense (which was charged to your card) to then get back a 25% discount.

This reminds me of the lawsuits a decade ago against the big consulting firms over travel rebates which were not passed on to the client (they were billed the invoiced amount). If i recall correctly the settlements were in 10's of millions.

There is a clear difference between a nominal rebate (e.g., 2% cash back or an airline point) that is common place and available to nearly everyone and and a 25% discount. An average person would likely conclude the price for the 3 nights was overstated to fund the 4th night free (regardless of who is actually funding it).

Why is 2% ok but not 25%? What about 3% or 4% or 5%.....? An AA Executive Mastercard is available to the same pool of people who can get a Citi Prestige card. So it is ethical to pay for the same stay with an AA Executive Mastercard but not a Citi Prestige?

Thought experiment. If you had a no annual fee credit card that gave unlimited 100% cash back on all hotel expenses, would you ever expense a hotel stay? I would not feel comfortable doing so. I don't pay for the stay but someone else (a client, a company) is reimbursing me as if I had paid. I'd be misleading them into thinking I incurred an expense that I did not.

Ethics, broadly defined, subsume good faith. Expense reports are meant to reimburse your actual cost of doing business plus maybe a small bonus in the form of miles/points, a larger than necessary per diem, or the 2-3-4-5% back as is the norm with credit cards. These bonuses are understood to all parties (client/adviser, employee/employer) as reasonable and can be written off because the alternative is considered stingy. Can you imagine an employer requiring everyone to deduct 2% from airfare expenses?

A 25% back card, OTOH, is extravagant. You're cheating your client or employer and misleading them about your actual expenses. You can't reasonably expect all parties to know of it. You can reasonably expect that if your client or your company finds out about it, your travel policy would change such that the client or company would pay less for your travel. In practice, the policy change would be to charge all travel to a corporate card.

If 25% cash back cards were commonplace, then it's fine to pocket the money. But they're not. So it's unethical to some.

Say I am your client and i just found out I paid your full hotel bill for four nights while in reality you were rebated one night and only had actual expenses for 3 nights. Tell me why I shouldn't feel you cheated me.