Los Angeles Unreimbursed Work Expenses Attorneys

Common Tactics Employers Use to Avoid Repaying Work-Related Expenses

While California law strictly forbids the practice of refusing reimbursement for work-related expenses, many employers utilize confusing policies, administrative loopholes, or intimidating contract language to deny valid claims. Employers do have the right to set reasonable limits on costs (such as only agreeing to reimburse coach airfare or hotel bookings under a certain rate) and require documentation, but they cannot unreasonably delay payment or claim they are not obligated to reimburse employees. 

We are familiar with the unlawful strategies that employers frequently use to avoid compensating employees for work expenses, including:

• Arbitrary submission deadlines. Employers often refuse payment because an employee missed an internal deadline for submitting receipts. However, California courts focus on whether the expense was necessary, not whether you followed a specific corporate timeline. Employers are permitted to maintain policies regarding expense report submission timelines and can discipline employees who fail to submit on time, but if your employer knew or had reason to know you incurred the cost, they must still pay. Keep in mind that the statute of limitations for an unpaid reimbursement claim is generally three years from the date of the failure to reimburse, though once a claim is filed, you can typically seek compensation for up to four years of unreimbursed expenses.
• Insufficient flat-rate stipends. Some employers offer a small monthly allowance for phone, vehicle, or internet use. If this flat rate falls short of your actual and reasonable business-related expenses, your employer still owes you the difference.
• Labeling essential tools as “voluntary.” Management might claim you “chose” to use your personal laptop or phone and imply that they never required it. If they expect you to be responsive after hours or complete work without providing company equipment, that usage is not voluntary.
• Independent contractor misclassification. Independent contractors are not entitled to reimbursements for work expenses. Some employers attempt to misclassify employees as independent contractors to avoid this and other obligations. We can evaluate your circumstances to determine if you are considered an employee under the law. 
• Unlawful waivers. Employers may pressure you to sign an employment agreement that theoretically waives your right to reimbursement. Under California Labor Code Section 2804, any agreement that attempts to waive these rights is null and void.
• The “unaware” defense. Employers frequently claim they did not know an employee was incurring expenses to avoid paying. If a manager accepts the benefit of your work, such as your travel to a client site or remote work deliverables, they have reason to know that costs were involved and consequently must indemnify you.