January 13, 2013


Many of our clients have asked. What are other companies doing with their cell phone/ mobile device issues? Providing the end user with a stipend, vs. managing all wireless issues sounds like a great plan in theory. But, is it a good fit for your organization? Should you allow your employees to bring their own device to work and provide a stipend instead of proving them with a device? The idea is that it allows the end-user flexibility and frees up the corporation to free up the resources internally that are tasked with managing that process.
There are many variables to consider when making this decision and that is where a CBI Risk / Analysis Report can help.

What is a Fair Stipend Amount?

Many of our clients have used a tiered approach, flat rate stipend and even reverse stipend models. Depending on the organization and job grade levels you can help to best determine the plan that would work for your organization.

Tired Approach = several tiers are offered, typically based on user profile; for example executive level = $75/$100, middle management = $50/$75, Entry level employee =$45/ $55

Flat Rate = All employees are given a single stipend amount and an optional one time equipment expense stipend.

Reverse Stipend = The corporation still remains liable, but offers a stipend amount or re-imbursement percentage to the employee based on the actual cost of the plan/device.

Financial Impact - What are the vendor contract ramifications?

Will there be implications with your current volume and or device count commitment? Will there be contract or early termination penalties? You will want to make sure that these questions are addressed before making any changes.

What are the soft cost dollars involved in internally processing IL expense items/expenses?

Typically it costs a minimum of $25-$40 per hour in hard and soft costs to process orders and manage them in a Corporate Liable environment. When your company goes Individual Liable, there will still be an approval process that must be followed and managed. The costs will be slightly less, but still need to be considered before making this change. Who will monitor the approval process and who will be the watchdog?

Current Cost today vs. projected new cost for Individual and Corporate Liable Reimbursement model cost?

We recommend compiling this data by gathering your current cost per device by each vendor and then combining those results. This will give you a true picture of current cost per device and assist you in comparing what things will look like in a new IL environment.

What are the legal and tax ramifications? How will this impact the end user and the corporation from this perspective?

Your organization can choose to make the stipend a taxable or non-taxable event for the employee depending on the way the program is deployed. There are benefits for each type of offering that your organization should consider.

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