The purpose of this statute is "to prevent employers from passing their operating expenses on to their employees." This law states that employers should reimburse employees for each and every expense that they incur throughout the course of doing business. ” Its purpose is to prevent employers from passing their operating expenses to their employees. Whether the employees have cell phone plans with unlimited minutes or limited minutes, the reimbursement owed is a reasonable percentage of their cell phone bills. California Labor Code Section 2802. As stated above, an employer must reimburse an employee for 100 percent of any “necessary expenses,” which California law defines as for the … How much reimbursement is enough? Charles Kagay | Legalweek(year) will bring together thousands of legal professionals for a series of 5 innovative virtual legal events. In this area, it is better to be conservative and over-estimate than underestimate and risk a privacy violation or a Section 2802 claim for failing to fully reimburse for actual expenses. How do you get found, and what happens after you’ve been found? If the employee wants the employer to reimburse the cost of a 50” television because they can no longer watch sports in the break room, the employer can likely decline the request. 3. For more detailed codes research information, including annotations and citations, please visit Westlaw . That includes expenses you might incur while working from home. Costs of doing business in California. Get the timely legal news and critical analysis you cannot afford to miss. Employers do not need to provide reimbursement for expenses incurred by independent contractors. She could, however, submit reimbursements for work-specific programs she was required to install on the device in order to fulfill her job duties. Both options are priced the same. That an item was “unreasonable” will not destroy the employee’s Section 2802 claim for a “necessary” expense; it will merely reduce the amount of their recovery. Tailored just for you. However, COVID-19 and the resulting shelter-in-place orders have redefined the working landscape, requiring many employees to work remotely to keep businesses afloat. Kenneth Artz Under Section 2802, you are not only entitled to reimbursement of all “necessary” expenses you have incurred in performing your job, you are also entitled to recover the fees an attorney may charge to recover those expenses from your employer in a lawsuit. Necessary expenditures or losses include all reasonable costs. (a) An employer shall indemnify his or her employee for all necessary expenditures or losses incurred by the employee in direct consequence of the discharge of his or her duties, or of his or her obedience to the directions of the employer, even though unlawful, unless the employee, at the time of obeying the directions, believed them to be unlawful. Employers that do not closely abided by this law suffer the consequences. (“(d) In addition to recovery of penalties under this section in a court action or proceedings pursuant to Section 98, the commissioner may issue a citation against an employer or other person acting on behalf of the employer who violates reimbursement obligations for an amount determined to be due to an employee under this section. Send reminders about expense reimbursement processes (or establish/communicate a process if one does not exist); Ensure any reimbursement policies require advance approval over a specific amount; Review job descriptions to anticipate likely reimbursements; Check with employees regarding devices they may need (or already have) to fulfill their job duties; and. Similarly, employees working remotely will need devices to work from – a laptop, desktop, tablet, etc. A Refresher on California Reimbursement Requirements in a COVID-19 World, Part Five of the COVID-19 Roadmap Series: Ensuring a Safe Workplace - COVID-19 Screening and Testing, Part Two of the COVID-19 Roadmap Series: Creating a COVID-19 Operations Infrastructure. Our Team Account subscription service is for legal teams of four or more attorneys. Cal. California Labor Code section 2802 has been around for a long time (since 1937, to be exact). }); Webcast Date : Wednesday, December 16, 2020 | Experts discuss how firms can transition to the cloud. How much should the employer reimburse? California Labor Code § 2802 (“Section 2802”) requires employers to reimburse California employees for “all necessary business expenditures or losses incurred by the employee in direct consequence of the discharge of his or her duties.”   Its purpose is to prevent employers from passing their operating expenses to their employees. (b) All awards made by a court or by the Division of Labor Standards Enforcement for reimbursement of necessary expenditures under this section shall carry inte… However, an employer should only be responsible for a reasonable percentage of that bill. var myDate = new Date(parseInt(1604611970000)); In California, an employee is entitled to be reimbursed by his or her employer “for all the necessary expenditures or losses incurred by the employee in direct consequence of the discharge of his or her duties…” When working from home, if not normally part of the job, certain expenditures may be entitled to re-imbursement by the employer. Read this complete California Code, Labor Code - LAB § 2802 on Westlaw FindLaw Codes are provided courtesy of Thomson Reuters Westlaw, the industry-leading online legal research system . If that same employee, however, purchased the latest, greatest desktop computer before being required to work remotely, she likely cannot submit a reimbursement for the desktop’s cost even though she must use it for work. Generally, an employee may seek reimbursement of a necessary business expense within three years of incurring the expense. Audit your car allowance or reimbursement policy to identify exposure points. Tags: Best Practices For California Employers, cell phones, Class Actions, Cochran v. Schwan's Home Services, Employee Handbooks, Expense Reimbursement, Friday's Five, Labor Code Section 2802, necessary expense, New Cases, Private Attorney General Act, reasonable reimbursement, Technology & Law, Wage & Hour Law Whether the employees have cell phone plans with unlimited minutes or limited minutes, the reimbursement owed is a … What are the consequences for failing to pay? If the employee’s electric bill increased because they are now working remotely, is that reimbursable? Under California’s new AB5 regime, many individuals previously operating as independent contractors may now be deemed employees. As stated above, an employer must reimburse an employee for 100 percent of any “necessary expenses,” which California law defines as for the actual costs incurred in … REIMBURSEMENT OF EXPENSES Employers must reimburse employees for losses and reasonable expenses incurred in the performance of the employee’s job duties. The new Illinois law mirrors key language in California Labor Code Section 2802, California's expense reimbursement law. Sponsored By: Appdetex While an employer has no obligation to reimburse for basic, non-uniform wardrobe items, the employer’s specific actions and expectations could give rise to a “necessary” business reimbursement. 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