UK small and medium-sized enterprises (SMEs) employees are losing out on £140 million a year in unclaimed work expenses. This is mainly due to the fact their company takes too long to pay them back, so they do not bother.
This survey was conducted by Soldo, a multi-user spending account. The survey found that more than a third (38 per cent) of employees do not bother claiming back expenses as their company’s process takes too long or is too complex.
The average SME employee spends 20 minutes a week submitting expense forms. This has led to 38 per cent of employees not attempting to claim back work items they purchased with their own money in the last 12 months.
People who work in PR, advertising and market research firms have the highest average value of unclaimed expenses at £65.75 per year.
The second largest reason for not claiming back expenses at 28 per cent was that the worker forgot to keep their receipt. With 30 per cent of staff saying their company does not have a system to reimburse people if they no longer hold a receipt.
When employees are finally reimbursed, 34 per cent said they have to wait at least a week to be paid back, as well as 5 per cent saying it takes over a month.
The research also found that 44 per cent of employees companies do not have a system in place to pay back expenses or they simply do not know if their company does.
Darren Upson, vice-president of small business Europe at Soldo, said:
Leaving staff out of pocket for an unreasonable amount of time damages morale, financial wellbeing and, critically, trust in the employer. It contributes unnecessarily to the already significant money concerns that many people – and especially young workers – have in today’s economy. Fintech has the power to positively impact financial wellbeing in the workplace – and more companies should be considering the benefits with this in mind.
Small businesses have typically led the charge in adopting new technology to support modern working practices, so it’s surprising that a process as fundamental as expense management has been left behind. The fact that a number of employees have been given a credit or debit card without a specific expense management system in place is especially worrying. It reveals a lot about the lack of control many start-ups and SMEs exercise over how company money is spent.
This survey was conducted on behalf of Soldo by TopLine Comms and Opinium Research in June 2019, interviewing 1,000 people in full-time work in SMEs in the UK.