Go Back  FlyerTalk Forums > Miles&Points > MilesBuzz
Reload this Page >

New trend in cost-cutting? Company paid travel = company miles?

Community
Wiki Posts
Search

New trend in cost-cutting? Company paid travel = company miles?

Thread Tools
 
Search this Thread
 
Old Oct 9, 2010, 5:29 pm
  #46  
 
Join Date: Sep 2009
Programs: *G, SPG, OW Sapphire
Posts: 2,565
Originally Posted by kebosabi
Interesting. Do AA Business Extra allow points to be earned on AA's partners too or just AA flights?
The full Terms are here

excerpt:

Only purchased, published fare revenue from eligible flights, excluding codeshare flights, booked in eligible fare classes for travel on American, American Eagle, and AmericanConnection® and ticketed on American Airlines 001 ticket stock, will contribute to monthly revenue, net of refunds, fees, taxes, and commissions ("Flown Revenue") for the purposes of earning Points.
johndeere19 is offline  
Old Oct 9, 2010, 5:48 pm
  #47  
 
Join Date: May 2009
Location: South Park, CO
Programs: Tegridy Elite
Posts: 5,678
Originally Posted by LittleCupcakes
No demonizing here. And to call not keeping miles an "injustice", well, that's tough to see.

With Kraft or whatever, it's the stockholder's call. I don't own stock in Kraft (or whatever mega-global corp owns Kraft) so I have zero say in the matter.

Taxes are sucked out of my marrow, involuntarily, and should be spent only to the benefit of the citizens (yes, though OT, I would include idiocies such as "foreign aid" as wasted money).

Government workers, by the way, make MORE than the private sector when all compensation is included. See this Cato report (PDF) or this USA Today story. Please note that for mileage purposes, it doesn't matter how much the employees make.

I agree with the EQM/RDM difference. EQM brings benefits that are useful only when "in the air" as it were, and are not quantifiable in the way RDM miles are. If the government employee flies enough to earn a status, fine.
I never called not keeping miles an injustice. I asked how you feel it is an injustice to you, the taxpayer, for a gov employee to keep miles earned, as you seem to have a real issue with it. Especially since there is no cost or other impact to the taxpayer. You haven't answered that question.

By the way we pay taxes, too - also involuntarily. No discount for being an employee. As I said I've personally more than saved the gov't more than I will ever pay in taxes. Heck, my UA status saved ~$250 in baggage fees this year - more than any supposed "value" of the miles I've flown.

Two studies lumping together all career fields, and all geographic areas, make for good class warfare angst but are not fair comparisons. There are studies showing the opposite case as well. Perhaps you want to express your issues with gov workers in an OMNI PR thread before this goes way OT.
84fiero is offline  
Old Oct 9, 2010, 6:54 pm
  #48  
 
Join Date: Sep 2006
Programs: United: 1K
Posts: 390
Originally Posted by Beer Me!
As for the mechanics of this program, the company enlisted the corporate travel agency to create individual FF and hotel accounts for all traveling employees. All employees were required to sign over Power of Attorney on these accounts to the travel agent as a condition of employment. The travel agency would purchase award tickets with the RDMs in the account to augment our business travel. As individuals, we kept the EQMs (and status), but were not allowed to access the RDMs or hotel points for personal use. For rental cars, the TAs negotiated a non-points earning rate, so they were not a factor. The company eliminated this policy about 2 years ago (right before the company was taken over).
How did they manage to circumvent the rules? For example United says:

"The Mileage Plus Program is maintained for the benefit and participation of individual members only. Only individuals are eligible for Mileage Plus membership, and each member may maintain only one account. Duplicate accounts will be subject to cancellation. Only the member named on the account will be entitled access to personal account information."

Or, perhaps, United implemented this rule to prevent companies from doing what your company was doing.
dweick is offline  
Old Oct 9, 2010, 7:18 pm
  #49  
In Memoriam
 
Join Date: Feb 2000
Location: Easton, CT, USA
Programs: ua prem exec, Former hilton diamond
Posts: 31,801
At one company I worked for (long since swallowed up by another company) all your travel had to be through a corporate travel agent. They kept track of your miles, and the policy was any official business miles you collected, you had to use it for business trips. So while the company never got the miles, in reality I could not use them, they had to be used for company travel.

Status miles, though were ours to keep.
cordelli is offline  
Old Oct 9, 2010, 7:28 pm
  #50  
 
Join Date: Apr 2010
Location: Pikes Peak COS
Programs: 3 Month Delta Plat, UA PP 2.4mm, Marriott Lifetime Titanium, HH Lifetime Diamond, National EE
Posts: 426
I would be done

I would be done being a road salesman. It is certainly part of my compensation for missing time with my family, sitting at O'Hare at 2am on a "decision", and spending days on the road to save the company a dollar by not taking non stops.
c502cid is offline  
Old Oct 10, 2010, 8:32 am
  #51  
 
Join Date: May 2010
Location: STL
Programs: UA 1K; WN A-List; HH Diamond; Marriott Gold; National EE
Posts: 194
Originally Posted by dweick
How did they manage to circumvent the rules?

...

Or, perhaps, United implemented this rule to prevent companies from doing what your company was doing.
I believe my old company may have been the first (or at least among the first) to do this. IIRC when the employees reached out to TWA, they had never heard of any large company keeping the miles of their employees. TWA initially challenged it but stopped as they didn't want to risk being blackballed by a major company in their hub city.

From the company's perspective, each individual only had one account. They just had the power to manage it. There were rules in place that if we were caught changing the account to charge miles to a personal one at the airport/hotel, we were subject to punishment up to and including termination.

I can tell you that I had both a personal and company account for many years. Perhaps it never was flagged in the various systems is that the address, phone number, etc. (everything other than my name) pointed back to the TA.
Beer Me! is offline  
Old Oct 10, 2010, 9:04 am
  #52  
 
Join Date: Aug 2002
Location: MCI
Programs: AA LT Gold; BA Silver; Hilton Diamond
Posts: 3,081
Originally Posted by mecabq
The biggest benefit of all for companies would be that overall travel costs would go down -- how many of us have taken a flight other than the cheapest, most convenient one, or even taken a whole trip that is only marginally necessary for the business, because it's on our preferred airline?
Speak for yourself. My rule has always been that if I can get extra points by doing something cheaper or at equal cost to the most logical alternative, I will. (I'll frequently choose a Fairfield or Hampton around the corner from a full-priced hotel where my convention is meeting.) I never choose a business hotel or a flight that's more expensive to get extra points. And, as was pointed out earlier, managers have to approve trips. If the manager has approved it, it's necessary or else the manager has bad judgment.

I'd consider a requirement to turn over FF miles and hotel points to the company as a cut in compensation and would re-evaluate my position accordingly. And I would be FAR less amenable to traveling on weekends and outside of normal working hours.
Athena53 is offline  
Old Oct 10, 2010, 9:28 am
  #53  
 
Join Date: Jan 2009
Location: New York suburbs
Posts: 4,211
Who gets the points if an airline bumps you from a flight and pays for your hotel? I don't think they stuff their passengers in a cheaper motel without a rewards program. (the kind that cater to roadtrippers, long-term tenants, sometimes shady loiterers, etc. where low price is considered its own reward)
Auto Enthusiast is offline  
Old Oct 10, 2010, 11:36 am
  #54  
 
Join Date: Nov 2005
Location: NYC
Programs: Delta DM, SPG Plat, Hyatt Diamond, MTA Rust, Hertz Five Star something or other
Posts: 2,858
Originally Posted by Auto Enthusiast
Who gets the points if an airline bumps you from a flight and pays for your hotel? I don't think they stuff their passengers in a cheaper motel without a rewards program. (the kind that cater to roadtrippers, long-term tenants, sometimes shady loiterers, etc. where low price is considered its own reward)
If its a Starwood hotel, its on a rate that doesn't earn points because its direct billed. You do, however, get Platinum amenity points if applicable, but no stay credit. Not sure how the other chains do it
thepointsguy is offline  
Old Oct 10, 2010, 12:14 pm
  #55  
 
Join Date: Aug 2002
Location: MCI
Programs: AA LT Gold; BA Silver; Hilton Diamond
Posts: 3,081
Originally Posted by Beer Me!
Overall, I can't see how they saved any money through this program. Most travel the employees did required extreme flexibility (back in the pre change-fee days), so most refused FF tickets when the TA offered them. When they began to force us to take them, it often led to many change fees and ticket cancellations. Plus they were paying the Corporate TAs (who had a branch on campus to support only our company) a fortune to manage this for us. I suspect the reason that it finally was eliminated was that it was actually costing the company money rather than providing any savings.
I think that kills most of these initiatives. When I want to redeem miles for the really desirable destinations, I plan 10 months out and even then don't always get the timing I want. Business travel isn't that flexible. There's also a lot of cost in collecting and monitoring miles for people who travel 2-3 times a year (on different airlines) so never get enough miles to redeem. Finally, the employee loses the ability to gain Elite status through a combination of business and personal travel. I've done that for years and my employer reaps a few rewards from it- better productivity when I got upgraded (I can work comfortably on my laptop in Business but not in Coach), free breakfasts in hotels, and now fewer "junk" fees for checking bags and reserving seats.
Athena53 is offline  
Old Oct 10, 2010, 3:12 pm
  #56  
 
Join Date: Jun 2001
Location: IAD
Programs: Chase Million Miler, SPG Gold, HHonors Gold, Hyatt Platinum
Posts: 2,729
Originally Posted by sushanna1
[/I]
You will also find out that compared to private industry we are underpaid.
I work for a government contractor, and I would have to agree. When I took this position, I was also looking at some federal government jobs, and the pay isn't nearly what I make at the job I have now. We're talking a difference of $10k-$20k, perhaps even more when one takes into account that my job pays me by the hour.
DHAST is offline  
Old Oct 10, 2010, 3:19 pm
  #57  
 
Join Date: Jun 2001
Location: IAD
Programs: Chase Million Miler, SPG Gold, HHonors Gold, Hyatt Platinum
Posts: 2,729
Originally Posted by LittleCupcakes
Government workers, by the way, make MORE than the private sector when all compensation is included.
The study doesn't really describe its methodology, and until it does, I'm not giving it a lot of credit. If they're considering *all* private sector jobs and *all* government jobs, well, then there's some major flaws. For one thing, there is no public sector equivalent to McDonalds (low wages), and there is no private sector equivalent to air traffic control (high wages).
DHAST is offline  
Old Oct 10, 2010, 3:38 pm
  #58  
FlyerTalk Evangelist
 
Join Date: Jul 2000
Location: in the vicinity of SFO
Programs: AA 2MM (LT-PLT, PPro for this year)
Posts: 19,781
Obviously, employers would like to capture that value, but in practice the fact that the airlines get to set the rules and it's not really in their interest to let employers do that.

Indeed, it strikes me that it is in the airlines best interest to disallow this as much as possible: companies who choose to go the route of exclusive-carrier or preferred-carrier agreements can already get better pricing in many cases (and non-mile-earning fares in many cases, which at least theoretically will recapture any value in the miles in better pricing) while the airline will see no benefit from the loyalty program from companies with lowest-coach-fare rules if the company accrues the miles.

Meanwhile, if the individual accrues the miles, the airline sets up a situation where they may benefit even in a strict lowest-coach-fare-only situation, as the individual has a much bigger incentive to move business to that airline, either if fares are equal, or where they're approximately equal, even if the fare would result in a small out-of-pocket/unreimbursed cost. This will generally be cost-neutral to the company, no?

Further, as long as the airline only allows individual accrual, the whole "individual accrues, but must use for company purposes" both (A) sounds like a pain in the neck for companies, especially since it requires a lot of bookkeeping and requires that individual to still direct their flights to a given airline to accrue enough miles for it to be worth it, and (B) because of the latter, serves the airline's purposes.

re: the specific question of government employees, I have no problem with their earning miles on my tax dollar. The degree of wastage purely in terms of not recapturing the miles is going to be tiny compared to what I've seen when I was at a private sector job that didn't have a "lowest coach" rule (both in terms of a very low threshold for paying for first/business class, and an tendency to automatically book everyone else in flexible coach rather than using restricted tickets when possible.)

Also, I'd very much like to AVOID seeing the government (or government employees in an official capacity) playing favorites between airlines (other than preferring US-owned over foreign), which I think an attempt to control mile-earning would lead to - any kind of "exclusive/preferred carrier" agreement would IMO be inappropriate. The federal government should be large enough to be able to get preferred rates from all the carriers without any such concessions, but I doubt that's true for state and local ones.
nkedel is offline  
Old Oct 10, 2010, 3:42 pm
  #59  
 
Join Date: Nov 2008
Programs: Too Many to Count
Posts: 510
Originally Posted by Travelergcp
There would be a massive revolt. I consider it a portion of my compensation.

The savings are probably not a great as you think, especially after you factor in the additional compensation you will have to give to key employees.
Yup! I will tell you right now that would cause me to seriously contemplate quitting my job. The primary reason I'm with my company is the travel. Second place is an incredible perk too (I incur absolutely no living expenses), but I consider that a distant second.
hiltonlondon2009 is offline  
Old Oct 10, 2010, 3:57 pm
  #60  
Original Poster
 
Join Date: Jul 2006
Location: LAX
Programs: AA EXP 1.5MM, Asiana Club Silver, KE Morning Calm, Hyatt Platinum, Amtrak Select
Posts: 7,161
Originally Posted by dweick
How did they manage to circumvent the rules? For example United says:

"The Mileage Plus Program is maintained for the benefit and participation of individual members only. Only individuals are eligible for Mileage Plus membership, and each member may maintain only one account. Duplicate accounts will be subject to cancellation. Only the member named on the account will be entitled access to personal account information."

Or, perhaps, United implemented this rule to prevent companies from doing what your company was doing.
Per new law, companies are "individuals" too. As such, companies can now influence the travel industry by attaching "flying/staying on behalf of" field into the reservation so that the company earns the miles/points over the individual.

This was also discussed in Japan I believe last month against their government employees collecting miles on trips and using them for personal use. Some companies in Japan also began to look at this to save on travel costs and have begun questioning both JAL and ANA to add this "company name" field into reservation system so that the company/government can collect the miles instead.

Were high travelling Japanese company businessperson get upset? Of course they did. But the reality is there really is no obligation for the company to do so, and at a whim they can say "tough luck pal, that's how it is, that's how the industry is going, if you don't like it, find another job." And sooner or later, they're gonna realize that miles-collected-by-the-company is gonna be the norm everywhere they go.

Hey, Japan's a cost-cutting capitalistic country, so is the US. If it happens there, it can become the way it is over here too.

Originally Posted by hiltonlondon2009
Yup! I will tell you right now that would cause me to seriously contemplate quitting my job. The primary reason I'm with my company is the travel. Second place is an incredible perk too (I incur absolutely no living expenses), but I consider that a distant second.
And what if the next company you apply to have begun this policy as well? And another? Companies can change their policy if there is no obligation to do so; and by the way things are going with cost-cutting these days, it's gonna become ever more difficult to find a place that'' let you collect your miles/points.

Remember, if they can cut costs by shipping manufacturing jobs to China, the company can go after white collar workers next. Union manufacturing laborers once said "if you don't give me the perks, I'll quit my job and go elsewhere." Reality: they're out of a job because they didn't make amends and industry wide, manufacturing went to China. And lately, companies are beginning to look at white collar perks these days now to cut costs in the office space.

Sad thing is, companies can say this and it can become an industry wide standard now as they look for new ways to cut costs. They're no obligation to hire you just because of collecting miles/points, from a company perspective, they'd rather collect those miles/points on their own as they're the ones paying for them, and use miles/points for their own benefit rather than yours. If the person doesn't like it, they're free to leave, there's millions of unemployed Americans out there willing to take that person's job who'd be willing not to earn miles/points perks for the sake of feeding their families right now.

Sure it sucks from an individual perspective, but it makes darn good sense from a corporate perspective. The miles flown by all of the road-warriors of a company can be put together for redemption (at full anytime mileage award rate) for many people on a tradeshow overseas instead of shelling out tens of thousands of dollars.

Many of the roadwarriors are also top level elites in their programs, earning 25%~100% bonus miles. Say if three people in ACME Corp makes LAX-JFK roundtrip on AA every month and they all are PLT or EXP elites in the AAdvantage program, they're earning 356,400 RDM (2475 mi x 2 x 2 x 3 x 12) combined; that's enough to send 7 people to an annual tradeshow in Japan or Korea in economy at saver value or 3 people at the anytime redemption rate, for practically nill instead of spending thousands of dollars per person. AA would probably love to see ACME Corp burning through their miles at full anytime rate as well. It's a win-win for both the ACME Corp and AA; there's a synergy there that can be made where AA can just add a "flying on behalf of" field in their reservation system so that miles go to ACME Corp.

Last edited by kebosabi; Oct 10, 2010 at 4:26 pm
kebosabi is offline  


Contact Us - Manage Preferences - Archive - Advertising - Cookie Policy - Privacy Statement - Terms of Service -

This site is owned, operated, and maintained by MH Sub I, LLC dba Internet Brands. Copyright © 2024 MH Sub I, LLC dba Internet Brands. All rights reserved. Designated trademarks are the property of their respective owners.