Sunday, February 23, 2014

Gambling on getting employer to settle losses

There's an old joke meant to disparage the reputation of a particular profession that goes something like this:

A client decides to pay for the services he receives in cash. After he settles his bill and leaves the cash with the professional who provided the services, the professional notices that the client mistakenly left twice as much cash as necessary. (Crisp new bills tend to stick together.)

Now, the professional faces an ethical quandary, goes the joke, followed by the punch line: "Do I tell my partner about the extra cash?"

An email from a reader reminded me of that joke, although I'm fairly certain the connection was unintended.

The reader recently went on a business trip for five nights to Las Vegas. He booked his hotel well in advance for $100 a night. His company was to reimburse him that $500 plus taxes and food expenses incurred while on the business trip.

After work hours, the reader writes that he spent a bit of his free time in the hotel's casino.

"I lost," he writes, "but I'm not sure that matters."

When he went to check out, his room and food charges had been comped by the hotel.

"My bill was $0."

Now, the reader wants to know if he should put the $500 for his room, as well as the food costs that he would have been charged had he not been comped, on his expense report.

"Or should the company not need to pay anything because I didn't?"

The reader seems in a genuine conundrum over whether or not his employer should pay for a room and food for which the hotel did not directly charge him.

"I certainly would not expect my employer to share my losses, and conversely, I do not expect to share my 'winnings' with them, either," he writes. "I'd love to know your thoughts on this situation."

Because the reader believes he was comped his room because he had sunk so much money into his gambling in the casino, he seems to be suggesting that he essentially paid the hotel something roughly equivalent (or more, he's sheepish about the exact amount of his losses) to what it would have charged him for his room and food. As a result, he believes he might be able to justify expensing what would have been the cost of his room and food had he actually been charged that amount.

If the reasoning in those prior sentences seems a bit convoluted, that's because it is.

The reader gambled on his own time, lost money, and should pay his debt. He should not expect his employer to directly or indirectly settle his losses by seeking reimbursement for expenses he didn't have on the business trip.

The right thing is to use his own money to pay for his losses in the casino, and to be honest about reporting to his company what he was actually charged by the hotel. If he didn't pay anything directly for his room and meals, then his employer shouldn't have to, either. 

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William Jacobson said...


Seriously? That this question even has to be asked...

His company offers to recompense him for specific business expenses incurred. Claiming expenses that he has not actually incurred is fraud and, in every company I've worked for, a firing offense.

Furthermore, accepting the free room and food while on business may violate his company's gift policies.

Your reader's greed exceeds his good sense. If the chance to defraud his company out of $500 is more valuable to him than his continued employment (and potential criminal charges) then go ahead. In this economy, there are hundreds of honest workers ready to take his place.

William Jacobson
Anaheim, CA

Anonymous said...

Boy, did you get it right Bill. Expenses on a trip are for specific things usually quite pre defined. The gambling was his own doing and the casino quite nicely attempeted to compensate him.
Usually a reciept is needed for all hotels, rental cars, flights, and other larger expenses, and such obviously did not come in this case. If his company does not want one, it is surprising but possible.
And Bill mentioned the "gift" rule. This too may apply should he charge the room off to his employer.
Just let it slide as, quite correctly, it is fraud any other way.

Alan Owseichik
Greenfield, Ma.

Anonymous said...

I would posit:

My boss gave me $3000 to buy steel. We agreed to buy it from a friend. The friend died on my way over of a heart-attack, and in the will I got the business. Hmmm... I wonder, since the steel cost me nothing, should I return the $3000?

The man had an agreement with his employer for $500 + the cost of meals. The employee was comped the meals and room as a result of his personal activities. He SHOULD go to his employer and explain the situation. As an ethical man, he should be willing to be defrauded rather than to defraud. However, as a result of something he did on his personal time, he earned an advantage which had a monetary value of $500 + food expenses.

Unless the employer wishes to pay him for his time outside of work (since that is where the advantage was generated) than the employer should be WILLING to pay those expenses. If the employer is unwilling to compensate the employee for his time and his losses, than he should not share in the winnings either.

The employee should be discussing it with the employer. Not you boneheads.