- 9 -
diem on a basis other than miles driven would have required a
duplicate accounting system.
Between 1995 and 1997, drivers were in short supply.
Continental could not abruptly change its compensation system if
its drivers would have perceived the change to their detriment,
as Continental would lose large numbers of drivers to competing
trucking firms. Continental management concluded that in times
of short labor supply, changes in a compensation system must
occur across the industry, and no single company can change
significantly its compensation without an adverse impact on its
driver retention.
Continental made a business decision to substantiate
deductions for its drivers’ per diem allowance using the revenue
procedures prescribed by the Internal Revenue Service.
Continental did not require drivers to submit receipts or records
of their travel expenses, if any, except pursuant to layover and
phone call policies. Drivers generally did not submit receipts
or other records to the corporation. Indeed, when drivers did
submit receipts for travel expenses not related to layover or
phone calls, Continental destroyed the receipts or put them back
in the driver’s trip envelope without consideration.
Continental paid the per diem in lieu of reimbursing actual
expenses for meals and incidental expenses incurred by drivers.
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
Last modified: May 25, 2011