As COVID-19 changes how our nation and state work, there may be additional employee reimbursement issues that arise. In California, the reimbursement of employee expenses is outlined in the California Labor Code as the state has articulated an interest in stopping businesses from passing on expenses to their workforce.

Specifically, California Labor Code §2802(a), states the following:

“(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.”

Typically, the most common reimbursement issue that people think about in the workplace is mileage for car related travel. If your employer requires you to drive your personal vehicle from your normal business location to another location for a business purpose, you are entitled to reimbursement for that expense that you have incurred. Not only are you entitled to funds for the gasoline that your car is burning, but you are also entitled to compensation for the miles added to your car thereby decreasing its value.

With increased work from home and less driving taking place, reimbursement issues may begin to manifest themselves in other less traditional manners. For example, a California Federal District Court case from years ago Novak v. Boeing (2011) WL 9160940, at 3 (C.D. Cal. July 20, 2011)was an early case exploring this issue. In that matter, some Boeing employees worked in a “virtual worker” program that allowed them to work at home. In order to work from home, the employees had to use their own telephone lines and internet connections leading to the reimbursement lawsuit. That case ultimately was decided in the employer’s favor because the work from home was optional, meaning that it was not necessary that the workers incurred those expenses because they had the option to work from the office but chose not to. However, this may not be the case for many employers who have switched to mandatory work from home in light of COVID-19.

Employees working at home may be more reliant on personal cell phones, internet, and other equipment being used for a work purpose in their home. Some areas where this may manifest itself are the following:

  • Cell Phone bills
  • Landline Phone bills
  • Home Internet bills
  • Printing costs
  • Personal device costs
  • Fax machines
  • Teleconference software and hardware.

This issue of failing to reimburse employees is sometimes linked with improper payroll deductions made by employers.  For example, In California, if an employer requires that an employee wear a uniform, the employer must pay the cost of the uniform. The term “uniform” includes wearing apparel and accessories of distinctive design and color. While the employer is allowed to have the employee place a reasonable deposit for the uniform, they cannot outright charge the employee for the uniform and deduct money from the employee’s wages. Instead of properly reimbursing employees for the cost of uniforms, employers might improperly deduct wages which can lead to a violation. Other common payroll deductions often made by employers that are unlawful include:

  • Photographs
  • Gratuities
  • Medical or physical exams
  • Certain business expenses

If you believe your employer has been unlawfully deducting wages from your paycheck, whether or not it is related to a reimbursement issue, contact an experienced employment attorney to discuss your legal rights.

What can my employer lawfully deduct from my wages?

Under California law, an employer may lawfully deduct the following from an employee’s wages:

  • Deductions that are required of the employer by federal or state law, such as income taxes or garnishments.
  • Deductions expressly authorized in writing by the employee to cover insurance premiums, hospital or medical dues or other deductions not amounting to a rebate or deduction from the wage paid to the employee.
  • Deductions authorized by a collective bargaining or wage agreement, specifically to cover health and welfare or pension payments.

To discuss whether your employer has been unlawfully or improperly deducting expenses from your paycheck, or whether your employer has failed to properly reimburse you for necessary work expenses, contact the skilled lawyers at Webb Law Group today.