Flat car allowance models, in which single, company-wide rates are used to reimburse all employees for any business travel, have historically been a popular method of mileage reimbursement. Unfortunately, though, this model just isn’t flexible enough to reimburse all employees fairly. For example, giving each employee $300 a month to cover all business travel expenses might initially seem like the easiest approach; but by not calculating individualized, location-specific reimbursements, companies usually end up either underpaying or overpaying workers.
