California Employee Rights Advocate : California Labor Attorney & Lawyer : Southern CA Employment Law : Los Angeles, Orange County : United Employees Law Group

California Labor law requires that employees be reimbursed for their work related expenses, such as mileage, supplies, training, tools and equipment and even legal expenses. Alternatively, employers usually have policies and procedures that create deadlines, in order to request and receive reimbursement.

In Stuart v. RadioShack, an employee is suing for reimbursement and RadioShack argues that his claim has no merit because Stuart did not make a proper request under its policies and procedures. So the question is: Do the requirements of the statute override policies and procedures for reimbursement set by the employer?

California Labor Code section 2802 states:
"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."
"Any contract or agreement, express or implied, made by any employee to waive the benefits of this article or any part thereof, is null and void."

California employers are required to reimburse employee expenses and employers cannot allow the employees to surrender or limit these rights for any reason. According to the Northern District Court: the employer's responsibility to reimburse expenses should be triggered by the same standard that applies in cases of "off-the-clock" work:
“The Court concludes that a fair interpretation of [Labor Code] §§ 2802 and 2804 which produces “practical and workable results,” consistent with the public policy underlying those sections, focuses not on whether an employee makes a request for reimbursement but rather on whether the employer either knows or has reason to know that the employee has incurred a reimbursable expense. If it does, it must exercise due diligence to ensure that each employee is reimbursed.”

Basically, employers can continue to use their policies and procedures but if they learn about reimbursable expenses that are owed to the employee, the employer should make every effort to reimburse the employee.

If you are concerned that you are owed reimbursable expenses please contact a California labor law attorney to help you claim the money that is owed to you.

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California Labor Law is an ever changing body of law. It is not uncommon for California employers to accept myth as fact when it comes to dealing with employees and their compensation.

While we have found these violations most common in small to medium employers who do not have the benefit of large HR departments or California labor law attorneys, large employers are surprisingly guilty of some of the same infractions. As such, a slew of California class action cases have been filed in the past 10 years or so making California a hotbed of class action litigation with the extensive protections available to California employees in the workplace.

The four most common mistakes employers make are:

1. Misclassifying an employee as exempt from overtime. This typically means paying the employee a salary and having the employee work in excess of 8 hours in day or 40 hours in a week without paying overtime. Also, it is typical in this scenario to not permit the employee to take a 30 minute uninterrupted lunch break. Both of these examples represent a violation of California labor laws and provide the impetus for a wage claim.

2. Another common scenario is employers having their employees pay some or all of their own expenses related to their employment. It is not uncommon for employees to use their own car for work related errands. In actuality, unless employee related expenses are clearly allocated as part of the compensation of the employee, they must be reimbursed. Use of cell or home phones is another abused area. If an employer is requesting an employee to make calls outside of work hours using their own cell phone or home phone, such charges should be reimbursed.

3. Having a policy of ‘Comp time.” Generally, Comp time means having an employee come in early or stay late, not paying overtime, but instead giving that employee the allowance of coming in late or leaving early on a subsequent day.

4. Vacation Forfeiture is another common problem. When an employee is separated from work, that employee must be paid all accumulated vacation along with their final wages. In addition, a “use it or lose it policy” is also illegal under California labor laws. It is lawful for vacation to be paid out under company policy as wages if not used, however, vacation time does not expire nor can it be taken away once accrued in California.

Our Attorneys have handled over 700 individual cases, and prosecuted over 150 class action cases related to California employment matters.

If you have experienced any of the above violations, it is important to talk to a California labor law attorney immediately.

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It is not unusual for employees to reach into their own pocket to pay expenses that relate to their job. A typical list includes the following:

• Using your car for business
• Cleaning clothing required to be worn at work
• Purchase, maintenance or loss of tools and equipment
• Expenses related to attending training or educational materials
• Travel
• Cell phones
• Lodging and meals
• Entertainment

An easy way to figure out if an expense should be paid back to you is to simply ask yourself the following question:

“Is this an expense that my company expects me pay for their benefit?” If the answer is yes you are probably entitled to be reimbursed.

To state it another way, the law requires employers to pay employees for any business expenses that arise out of an employee’s reasonable performance of job duties.

For example, if an employee must drive a car (other than to commute to and from work), pay for client entertainment, or make cell phone calls then Section 2802 of the labor code requires the employer to reimburse the employee for the expense.

An employee is entitled to recover all or a portion of unreimbursed business expenses that was paid in the last four years even if he agreed to forgo reimbursement, took an amount that is less than his costs or agreed a salary or commission that was supposed to include reimbursement for these expenses.

This law also covers anyone who was misclassified as “independent contractor”. There are many instances where a person believes he is an independent contractor but in fact is an employee. It does not matter if the error was made by an honest misunderstanding or intentionally. It also does not matter if the misclassification was made by the employer or the employee. It is the law that decides who is an employee and all the rights given to employees.

The law specifically requires an employer who provides a fixed expense allowance or an enhanced commission rate, ensure that expense
reimbursement payments fully cover all necessary expenses. The enhanced portion of any compensation that is supposed to cover all expenses paid by an employee must be identified by the employer by setting forth the method or formula used.

It is the employer’s obligation to show that all expenses incurred by its employees have been fully reimbursed because Labor Code Section 2804 forbids an employer to permit an employee to waive the right to reimbursement. Employees must be reimbursed for all necessary expenses of the employer.

Employers are liable for business expenses even when an employee has failed to submit required expense reports. The law focuses not on whether an employee requests reimbursement but rather on whether the employer either knows or has reason to know that the employee has incurred a reimbursable expense. If the employer has that actual or constructive knowledge, then it must exercise due diligence to ensure that the employee is reimbursed.

An employee should not pass up his right to receive reimbursement because no claim was made in the past or there is little or no documentation. This could occur when an employee does not understand his rights was misinformed or was discouraged from making a claim.

Not only does an employee have the right to reimbursement for business expenses but has the right to recover attorney’s fees, interest and penalties.

We as California labor lawyers know that an employee is not like a company that has the money to pay attorneys to protect them. That is why our law firm provides representation paid solely from money that we recover from the employer. In other words we help level the playing field.

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