Legal Question in Business Law in Virginia

Company required credit card

A company just issued a letter with the following:

''Company mandates the use of 'named credit' card for all travel and travel business purchases by employees''

However later states:

''named credit' card issued through th company are in the employee's name and payment is the sole responsibility of the card holder.''

I am required to do a bit of travel, and I have my own accounts that I use. How is it that they can mandate the use of a spacific credit company and then also calim that I am the person responsible?

Country Hick


Asked on 11/02/06, 8:07 am

1 Answer from Attorneys

Jonathon Moseley Jonathon A. Moseley

Re: Company required credit card

Well, let's put this into context: Does the company have the legal authority to require you to do these things? No. But do they have to continue employing you if they don't want to? No. Especially in Virginia. They can fire you for any reason or no reason at all. (A good reason to keep your resume current and keep looking for a better job at all times.)

So, no they cannot require this legally. But if you don't do it, they can fire you.

Clearly you have legitimate concerns. What happens if the company goes out of business or bankrupt? You could end up holding teh bag. You could end up in line along with all the other creditors hoping to get pennies on the dollar of what the company owes you.

Also, I don't like the wording of the short excerpts you gave from the letter. Maybe the letter overall reads differently.

Normally this type of arrangement makes clear that the company is going to pay you back and then you are going to pay the money to the credit card.

Even that is a bad deal. What if the company is late in reimbursing you? You end up paying late fees and interest, for which you are never paid back.

The wording of the excerpts does NOT clearly obligate the company to EVER pay you back for your travel. An independent contract, for example, could agree to pay for travel out of his own pocket, as part of the total fee he receives. So it is NOT automatic that you get reimbursed for travel. You can agree to any arrangement. The question is do you agree to it?

So you need to be very clear that you KNOW what they have promised, and consider refusing to go on travel without having the expenses paid in advance (that is airfare and hotel and rental car, perhaps not incidentals like food, etc.)

I would suggest taking the position that the "named" credit card IS ONE WITH YOUR NAME ON IT.... it is named, with your name. In other words, use any credit card that is NAMED with your name on it. The other requirements, that you are responsible to make the payments, etc., all fit your previosu credit cards.

Could they fire you for not following the procedues? Yes. Heck, they could fire you for no reason at all.

So you will have to consider which is more important to you... the risk of potentially thousands of dollars hanging out there or the job.

I would suggest looking for another job QUIETLY and then tell them you are leaving unless they eliminate your financial risks from that arrangement. CHANCES ARE THEY HAVE NOT THOUGHT THIS THROUGH and might fix it if it is explained to them.

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Answered on 11/04/06, 9:56 pm


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