The recent global health emergency resulted in a major shift in how we think of the traditional workplace. Most California residents started working from home and many of our workplaces are now more than a physical office space.
With the remote workplace becoming more and more common each day, many questions have arisen regarding the definition of work-related expenses.
Do I qualify for reimbursement?
California law has traditionally required employers to reimburse employees for necessary expenses involved with doing their jobs. This law was revisited during the pandemic, with the California Court of Appeal stating that this law applies to remote workers, as well.
Both exempt and non-exempt employees are covered under this law. The law applies to any employee who works in the state of California, even if the employer’s headquarters or the employee’s managers are located somewhere else.
However, independent contractors are not covered. Therefore, if you are an independent contractor working remotely for an employer, your employer is not required to reimburse you for necessary expenses.
Defining necessary expenses
If you do qualify for reimbursement, you may have many questions about what “necessary expenses” you are entitled to reimbursement for. California Labor Code section 2802 states that only expenses that are necessary to perform your job duties are reimbursed.
This means that if you are choosing to work from home, but are not required to, you are not likely to be reimbursed for your home office expenses. If you have a physical office with equipment that you could go to but prefer to work at home, remote working expenses are not necessary to perform your job duties.
Your employer is allowed to implement a reimbursement policy, with rules and restrictions surrounding reimbursements. They may require you to get approval before incurring an expense, provide reimbursement requests within a certain time or provide receipts for your claimed expenses.
While your employer can enforce discipline rules if you do not follow the reimbursement policies, even up to termination, they cannot refuse the reimbursement. You are entitled to it under the law.
Business v. personal use
The reimbursement law becomes complicated when certain equipment is used for both business and personal use, such as a laptop, cell phone or vehicle. There is no exact formula used to calculate reimbursement in these situations. Rather, your employer must reimburse you for a reasonable percentage of the business cost.
You may not always agree with what your employer decides is a reasonable percentage. You can report the issue to your manager or human resources department but be prepared to back up your proposed reimbursement amount with documentation or evidence.
Knowing these laws and how they apply to your situation is important to make sure you are properly reimbursed according to the law. Your employer is also required to know these laws and could be penalized for failing to comply with them, even if the failure is not intentional.