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Unreimbursed Business Expenses in California

Of the many laws that protect employees in California, one of the most often misunderstood ones involves the reimbursement of business expenses. Simply put, employers that do not reimburse certain business expenses are in violation of the law. While there are certain exceptions, the fact is that unreimbursed business expenses can add up quickly and create a financial burden for you or other employees.

If you have not been reimbursed for necessary business expenses, it is important to understand your rights under the law. That’s where our experienced California employment lawyers can help.

Contact Maison Law Today For a Free Consultation

As an employee in California, it’s important to be aware of the laws surrounding unreimbursed business expenses and the potential violations that can occur. At Maison Law, we’re passionate about helping clients by staying informed and proactive. More than that, we take pride in our ability to make a positive impact on the lives of our clients by helping them hold their employers accountable for their violations of the law. Don’t wait to seek the justice you deserve, contact us today to set up a free, no-obligation consultation.

What Are Necessary and Reasonable Business Expenses in California?

Part of the legal requirement involving unreimbursed business expenses in California is categorizing them as “necessary and reasonable”. To qualify as “necessary and reasonable”, these business expenses are those that are:

  • Incurred by employees as a result of their job duties
  • Are directly related to the employer’s business

Examples of qualifying expenses include:

  • Business-related travel expenses – This may include transportation, lodging, meals, and incidentals incurred while traveling for work.
  • Home office expenses – If an employee works from home, they may be entitled to reimbursement for a portion of their rent or mortgage, utilities, and other related expenses.
  • Equipment and supplies – This may include expenses for items such as computers, software, office supplies, and other equipment needed to perform job duties.
  • Job-related education and training – This may include tuition, books, and other related expenses for courses or training programs required for the employee’s job.
  • Mileage and vehicle expenses – If an employee uses their personal vehicle for work-related travel, they may be entitled to reimbursement for mileage, gas, and other related expenses.

Obviously, this categorization of business expenses is relatively broad. Thus, it’s important to understand what the language of the law says regarding these expenses in California, and how your employer may go about violating this law.

How Does California Law Cover Unreimbursed Business Expenses?

Under the California Labor Code, employers are required to reimburse these necessary and reasonable business expenses. Specifically, Section 2802 of the Labor Code covers the reimbursement of these expenses and it applies to all employees statewide.

The law requires employers to reimburse employees for these expenses, even if the employee fails to request reimbursement or if the employer does not have a specific expense reimbursement policy in place.

Importantly, the law doesn’t apply in certain situations when employers have:

  • A written expense reimbursement policy that specifies which expenses will not be reimbursed

However, the employee must still be reimbursed for expenses that are deemed necessary and reasonable, even if they are not specifically listed in the policy.

Violations

With this legal definition in place, there are a variety of different ways that an employer can violate the law. These typically include:

  • Failing to have an expense reimbursement policy – Employers are required to have a written expense reimbursement policy that complies with California law. If an employer does not have such a policy, or if the policy is unclear or incomplete, the employer may be violating Section 2802.
  • Refusing to reimburse employees for necessary and reasonable expenses – If an employer fails to reimburse employees for necessary and reasonable business expenses, such as travel expenses or equipment costs, the employer is violating the law.
  • Setting unreasonable limits on expense reimbursement – If an employer sets limits on expense reimbursement that are unreasonably low or that do not cover the full cost of necessary and reasonable business expenses, the employer is likely in violation of the law
  • Requiring employees to waive their right to expense reimbursement – Under the law, an employer can’t require employees to sign a waiver or agreement that waives their right to expense reimbursement. If this happens, it’s a violation of the law.
  • Requiring employees to use personal funds for business expenses – Similarly, if an employer requires employees to use their personal funds to pay for necessary and reasonable business expenses, and then fails to reimburse the employees for those expenses, it constitutes a violation of this area of the law.

As it applies to your specific situation, these violations can sometimes be difficult to understand or even catch. At the same time, it’s important to remember that part of the protection regarding this law gives you options to take action against your employer.

What Is The Best Option If Your California Employer Won’t Reimburse Your Business Expenses?

When it comes to your legal options if your employer doesn’t reimburse your business expenses, there are a number of different things you can do. At the outset, you should always consult with our lawyers first. We can give you a better idea of your options and how the law applies to your situation. From there, we can help you make the following steps toward getting what you’re owed:

  • Discuss the issue with your employer – The first step is to try to resolve the issue with your employer. Explain the expenses you incurred and why you believe they are necessary and reasonable. Sometimes, employers may not be aware of the law or may have misunderstood the expenses. By discussing the matter calmly and professionally, you may be able to resolve the situation quickly.
  • File a claim with the California Labor Commissioner – If discussing the issue with your employer does not lead to a resolution, you can file a wage claim with the California Labor Commissioner’s office. You can do this online or in person at any of the Labor Commissioner’s offices. The Labor Commissioner will investigate the claim and may order the employer to reimburse you for the unpaid expenses, plus interest and penalties.
  • File a lawsuit – A third option that you can take after the Labor Commissioner’s Office complaint wraps up is to file a civil lawsuit against your employer. We can help you draft and file a Complaint with the appropriate California court. The Complaint will detail the facts of the case, the legal basis for your claim, and the damages you are seeking to recover. After filing the Complaint, you will need to participate in the litigation process, which may include attending court hearings, responding to discovery requests, and negotiating a settlement with your employer.

An important thing to remember about litigation is that it takes a significant investment of your time and energy. More than that, it takes courage to stand up to your employer in open court. Fortunately, working with our team can provide you with the support and validation that you need to see your claim through.

Experienced and Dedicated California Wage Violation Lawyers

When your employer won’t reimburse your business expenses or violates any other laws relating to your wages, it’s crucial to have the right legal representation on your side. At Maison Law, our team of experienced and dedicated California employment lawyers can help you recover the compensation you deserve and hold your employer accountable for their actions. Don’t let these wage violations go unchecked – contact us today for a free, no-obligation consultation.

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