California law generally prohibits employers from requiring employees to bear the costs of business expenses. These costs can include cell phone expenses, client entertainment, and some uniforms. California Labor Code § 2802 states that employers must reimburse employees for “necessary expenditures and losses incurred as a direct consequence of the discharge of his or her duties…”
When an employer violates this law an employee is entitled to collect interest on the expenses made as well as recover for attorney’s fees and costs incurred in bringing a lawsuit. Although an employer is not required to reimburse expenses when the employee believed the expenses were unlawful at the time. Nevertheless, even if the expenses were actually unlawful and the employee didn’t know the employee would still be able to claim expenses.
Additionally, under California Labor Code § 2804 an agreement to waive full reimbursement for expenses is not enforceable even if an employer requires the agreement as a term of employment. Similarly, an employer’s deadlines for requiring an employee to submit reimbursement are not enforceable. Employees are entitled to reimbursement for up to 4 months after the date of the expense.
Common Examples of Violations
One common violation of this rule involves uniforms. A dress code is not a violation of this rule, but requiring the purchase of items directly through the employer is basically the same thing as a pay deduction.
Travel is another common is way that employers violate the reimbursement rule. When an employer requires an employee to run errands they must pay for the employer’s time and if the employee uses her own vehicle the employer must also pay mileage costs. IRS guidelines dictate that employers should pay 55 cents per mile in these circumstances. Time spent driving should also be paid at the employee’s regular rate of pay.
What if An Employer Violates These Rules?
Some employers have internal rules governing how to request reimbursement if a request was initially denied. However, employees are not required to comply with an employer’s formal rules, notifying the employer is enough. In the case of Stuart v. RadioShack the court held that an employer, not the employee has the duty to investigate if it has reason to believe that an employee incurred expenses on behalf of the employer. Employees may bring a lawsuit to enforce their right to reimbursement regardless of whether they followed the employer’s rules governing reimbursement.
If your employer has failed to reimburse you or pay your wages you may be entitled to a lawsuit. To learn more contact Cunningham Law, APC to schedule a free consultation by calling (951) 213-4786 today.