Wages & Compensation
Per Diem
A daily allowance paid to tradespeople who travel away from their home area for work, covering lodging, meals, and incidental expenses.
What It Means for Trade Workers
Per diem is a critical component of total compensation for tradespeople who work on out-of-town projects. When a skilled trade worker is dispatched to a jobsite more than a specified distance from their home, typically 50 to 75 miles, the employer or the collective bargaining agreement may provide a per diem payment to offset the cost of lodging, meals, and incidental travel expenses. The IRS publishes federal per diem rates by city and county, and in 2024 those rates ranged from $59 per day for meals and incidentals in low-cost areas to over $79 in high-cost cities, with separate lodging allowances often exceeding $150 to $300 per night depending on location. For trade workers, per diem can add substantially to take-home pay, especially on major industrial or infrastructure projects in remote areas where employers compete for labor by offering generous per diem packages. Some union contracts specify per diem rates that exceed federal guidelines. Importantly, per diem received up to the federal rate is generally not taxable income, making it a tax-advantaged form of compensation. Tradespeople considering travel assignments should factor per diem, along with base wage and overtime opportunities, into their total compensation calculation when comparing opportunities.
Frequently Asked Questions
A daily allowance paid to tradespeople who travel away from their home area for work, covering lodging, meals, and incidental expenses.
Per diem is a critical component of total compensation for tradespeople who work on out-of-town projects. When a skilled trade worker is dispatched to a jobsite more than a specified distance from their home, typically 50 to 75 miles, the employer or the collective bargaining agreement may provide a per diem payment to offset the cost of lodging, meals, and incidental travel expenses. The IRS publishes federal per diem rates by city and county, and in 2024 those rates ranged from $59 per day for meals and incidentals in low-cost areas to over $79 in high-cost cities, with separate lodging allowances often exceeding $150 to $300 per night depending on location.