By: Nicholas J. Ferraro | March 23, 2022 | Employment Law
Yes, employers must reimburse employees for using personal cell phones for business purposes. California law is clear on this issue. Additionally, employers may need to reimburse remote employees for business expenses.
What is the Law Regarding Cell Phone Reimbursements to Employees in California?
There is no federal law requiring employers to reimburse employees for their cell phone use. However, California Labor Code §2802 requires employers to reimburse employees for any necessary expenses or losses they incur while doing their job.
The California Second District Court of Appeal issued a clear opinion on this subject. The court ruled employers must reimburse employees for using their personal cell phones for business purposes.
In Cochran v. Schwan’s Home Service, Inc. (2014), Cochran filed a class-action lawsuit against Schwan’s Home Service, Inc. Cochran claimed Schwan’s failed to reimburse customer service managers for the use of their personal cell phones.
The Court of Appeal held that employers must reimburse employees for work-related expenses under Labor Code §2802. That includes using personal cell phones for work calls. The court also ruled that the employee only needs to show the employer required them to use their personal cell phone for business calls to receive reimbursement.
It does not matter whether the employee paid the bill or changed their service plan because of their work calls. The only issue is whether the employee had to use their personal cell phone to make work calls. If so, the employer has to reimburse the employee a “reasonable percentage” of the cell phone bill.
Employers must determine a reasonable percentage of the cell phone bill for reimbursement. For example, the employer might ask all employees how much they pay for cell service. They may ask for the percentage of time employees use their cell phones for business purposes.
Employers may choose to provide employees with cell phones they must use for all work-related calls and messages. Providing a work cell phone can avoid problems with reimbursement for personal cell phones.
If an employer provides a flat-rate stipend for cell phone use, the employee may submit actual expenses if they believe the stipend is insufficient reimbursement. The employer has a duty to review the request.
Reimbursement for Expenses When Employees Work From Home in California
COVID-19 required many employees to work from home. Therefore, employers and employees had to adjust quickly. Many employees had to purchase supplies and equipment to work from home. Some employers provide the necessary items for employees to use at home. Providing equipment and supplies for remote employees can avoid disputes related to reimbursement for work-related expenses.
The purpose of Labor Code §2802 is to prevent employers from passing their operating expenses on to employees. Therefore, employers must reimburse employees for expenses if they work from home. The expenses employers must reimburse for remote workers depend on the job duties and requirements.
However, common expenses employers may need to provide reimbursement for include, but are not limited to:
- Phone charges
- Postage
- Home internet charges
- Work computer
- Printer and printing supplies, including paper and ink cartridges
- Subscriptions for Zoom or other conferencing systems
- Office desk, chair, and supplies
An employer might need to reimburse remote workers for other work-related expenses in some cases. Without clear, written reimbursement policies, there may be disputes. For example, employees and employers may disagree about the definition of necessary business expenses. They may also disagree about a “reasonable percentage” for reimbursement.
For example, an employee may prefer an expensive desk chair or a second computer monitor. However, those expenses may not be necessary for the employee to perform their job. If so, the employer might not be responsible for these work-from-home expenses.
On the other hand, an IT support employee may require high-speed internet service to reasonably perform their job duties. Other employees may not need the more expensive internet plan.
What Should Employees Do if They Do Not Receive Reimbursement for Work-Related Expenses?
Employees may file a wage and hour lawsuit if their employer fails to reimburse them for work-related expenses. An employee may also file a wage and hour lawsuit if the employee believes the reimbursement amount is not “reasonable.” Employment law protects employer retaliation against employees who file claims or lawsuits.
Employees can receive
- Reimbursement for work-related costs
- Compensation for related damages
- Attorneys’ fees incurred in seeking reimbursement for work-related expenses
The California Labor Commission may issue fines and penalties for failing to reimburse employees for cell phone charges and other work-related expenses.
Generally, California employers must reimburse employees for all work-related expenses. If you are unsure about your legal rights regarding reimbursements for work-related expenses, you can ask a reimbursement lawyer in San Diego or call Ferraro Vega San Diego Employment Lawyers for help.
