Reviewing Reimbursement: Why Employers Must Reimburse Cost of Work Calls in the State of CA
The last few months have seen an unprecedented change in our professional landscape — when we work, how we work, and where we are working from. As we discussed in our post on work-from-home necessities, this disruption has had plenty of unanticipated consequences, not only in respect to our personal lives, but also in respect to our wallets!
For those of us adjusting to life outside of the office, the question of reimbursement is a pretty important one. After all, many of us are used to having a wide range of our daily amenities covered by our employers, from Wi-Fi and printer ink to toilet paper and snack foods. So are we expected to cover all of these work-from-home costs out of pocket? Here’s why you can probably expect to get at least partial reimbursement from your employers for expenses incurred in the coming months:
Precedent for Cellphone Coverage (in California)
Even before the pandemic hit, states like California had laws in place that required employers to reimburse their employees for necessary business expenses, like cellphone bills.
According to California Labor Code section 2802, “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.” In other words, if an employee spends money on a task that is necessary for the completion of their work, their employer should compensate them accordingly.
Of course, that section of the labor code doesn’t mention anything anything about cellphone usage. But in a 2014 case (Cochran v. Schwan’s Home Services) it was used to prove that it was unlawful for a company not to compensate their employees for work calls made on a personal cellphone. So long as employees can prove that they’re using their personal phones for work related calls, their employers are legally required to cover a portion of the expense.
What other Expenses May Be Covered
Generally speaking, although it’s a good idea to reimburse employees for business-related expenses, there is no specific federal requirement to do so. That being said, just like California, many states (New York, Massachusetts, and Illinois to name a few) have their own laws when it comes to reimbursement.
Under normal circumstances, if an employee isn’t required (or even encouraged) to work from home, most work-related costs wouldn’t require reimbursement, since working from home is something the employee is electing to do.
Even with some states opening up, however, working from home is still mandatory for a lot of people — and it probably will be for quite a while. With that in mind, employees might be able to expense more than just their cellphone bill — from Wi-Fi to printer ink, there are plenty of workplace necessities employees shouldn’t be expected to cover out of pocket. If you’re an employee and you’re not sure what’s covered, be sure to talk to your HR department, or read up on your local legislature.
Key Takeaways for Employers
There are plenty of ways to offer your employees a little extra help during the COVID era —disaster payments (which we wrote about here) are just one example.
Once you understand your obligations when it comes to reimbursement, you’ll be in a position to decide what you want to cover. Our #1 piece of advice? Set clear guidelines, and set them early. When it comes to reimbursement, a thorough, easy-to-read reimbursement policy will help manage employee expectations, and avoid overwhelming or confusing them. If you already have a reimbursement policy, great! Take this opportunity to update. If not, this is a good time to develop a good, legally compliant policy — after all, even once we can come back to the office, it will always benefit you to have a thoughtful, well-designed system in place.
If you have any questions about how you can better help your employees, or what other benefits you should be offering them, feel free to reach out to us at email@example.com.