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diem allowances, and the employees did not report the per diem
allowances in income.
Where the tax consequences differ for the characterization
of expenses as either travel or compensation, the
characterization of the expenses by the parties should be adhered
to. The majority opinion simply negates the bargaining positions
of United, on the one hand, and of the labor unions and the
employees, on the other, to pay and to receive travel expenses,
not compensation income.
In his concurring opinion, Judge Thornton is correct to ask
what was bargained for between United, its employees, and the
unions. The answer, however, is explicitly provided in the
stipulated facts –- per diem travel allowances, not compensation.
Paragraph 13 of the stipulation of facts states the following:
Because pilots and flight attendants continuously
traveled for United, requiring specific documentation
for meals and incidental expenses would have been
administratively burdensome. The per diem arrangement
was thus designed to reimburse the employees for meals
and incidental travel expenses, without requiring them
to retain and submit receipts for each individual
expenditure. [Emphasis added.]
The fact that for the administrative convenience of United
and the employees the per diem allowances were computed on an
hourly basis does not convert the allowances into something other
than travel expenses.
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