California Employers Must Reimburse Employees for Work-Related Expenses

April 6, 2015 by Andrew Baker

Employers rely more and more on their employees to be available to work nearly round the clock, and often expect employees to use their own personal cell phone, tablet, computer or car to get the work done.  Under California law, employers are required to reimburse employees for the costs associated with personal equipment used for business purposes.

For example, a court recently ruled that when employees must use their personal cell phones for work-related calls, California law requires the employer to reimburse them. 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, the court concluded. (The case is Cochran v. Schwan’s Home Serv., Inc. (2014) 228 Cal. App. 4th 1137.)

In another case, the California Supreme Court confirmed that employers that require employees to use their personal vehicles on the job must use some method to reasonably compensate employees for the use of their vehicles. The Court noted that the mileage reimbursement method was one such acceptable method.  Under this method, the employee keeps a record of the number of miles driven to perform job duties. The employee submits that information to the employer, who then multiplies the work-required miles driven by the current IRS mileage rate.

The Court concluded that California law also permits employer’s to use a lump-sum method, such as a car allowance, to reimburse employees for work-required automobile expenses, provided that the amount paid is sufficient to provide full reimbursement for actual expenses necessarily incurred.  (The case is Gattuso v. Harte-Hanks Shoppers, Inc.(2007) 42 Cal. 4th 554.)

There are a couple of interesting developments surrounding the California employment law requiring reimbursement to employees for use of personal devices, being called Bring Your Own Device BYOD in some circles.  While there has been no other post-Cochran California appellate decisions on BYOD, a class-action law suit has been filed in Los Angeles Superior Court that has gotten the attention of employers in other states concerned that the requirement to indemnify employees for use of personal devices may spread beyond California.

If you think you may have been denied reasonable reimbursement for work-related use of any device, such as your personal phone, computer or vehicle, please call us for a confidential consultation at one of Beeson, Tayer & Bodine offices in Oakland, Sacramento or Syracuse, NY.  We are an established labor and employment law firm with over 75 years of experience working to defend and advocate for the job rights of employees.

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