Under California law, employers must reimburse all employees for expenses or losses necessarily occurred in the scope of their employment. In order to qualify for a reimbursement, an employee does not actually have to incur any additional or employment specific out-of-pocket costs. For instance, an employee who uses their printer does not have to purchase paper or ink specifically to assist their employer in order to qualify for a reimbursement. An employee\u2019s use of their own printer and ink to complete work assignments constitutes a loss, and is therefore eligible for reimbursement.<\/p>\n\n\n\n
Employers must reimburse employees for all expenses or losses provided that the amounts incurred were reasonable. Common examples of reimbursements include mileage for an employee\u2019s use of their own automobile, cell phone, printer, computer, or internet connection while acting within the scope of their employment.<\/p>\n\n\n\n
Employers in California must reimburse all employees, regardless of their exemption status for expenses. All employees, including unpaid interns and CEOs, are entitled to be reimbursed for expenses.
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However, an employer\u2019s failure to properly reimburse employees for expenses under federal law can result in a minimum wage violation or cause the employee\u2019s exemption status to change.<\/p>\n\n\n\n
There are at least three methods by which an employer can reimburse an employee for auto expenses: (1) the actual expense method, which calculates the expenses that the employee actually and necessarily incurred; (2) the mileage reimbursement method, which multiplies the number of miles driven to perform job duties by a predetermined amount that approximates the per-mile cost of owning and operating an automobile, like the IRS mileage rate; and (3) the lump-sum payment method, in which the employer pays a fixed amount for automobile expense reimbursement.
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If an employer uses the lump-sum payment method, the amount provided to the employee must be sufficient to reimburse employees for the actual expenses incurred. An employer\u2019s failure to properly reimburse an employee for expenses may also result in a minimum wage violation.<\/p>\n\n\n\n