Per diem refers to a set daily allowance that an organization provides to its employees or representatives to cover a part of or all living expenses when they are working away from their usual place of work. This can include expenses related to meals, lodging, and incidental costs.
The intention behind per diem rates is to simplify reimbursement procedures and to offer a standardized amount that aligns with typical costs in a given area without the need for submitting detailed receipts.
Depending on the jurisdiction or organization, specific per diem rates may vary based on the destination’s cost of living or the nature of the task.
While per diem generally means daily allowances, in some contexts, it might also describe temporary or day-to-day engagements, especially in professions like nursing or consulting, where professionals might be employed on a daily basis.