Are You Being Fully Reimbursed for Your Business Expenses?

Under California law, employers are required to reimburse their workers for business expenses linked to their jobs. When they fail to do so, either due to an error or a deliberate act, this is a violation that could lead to legal action.

Employment Lawyer Ian Silvers: Protecting Your Rights as an Employee

I’m Ian Silvers, a partner at Bisnar Chase, where I focus on employment law—specifically wage and hour class actions and representative cases. Below, I’ll highlight some frequently overlooked issues regarding your employer reimbursing you for expenses you incur.  This applies to all employees, whether they are exempt or non-exempt, paid a commission, piece, rate, salary or hourly.

Read on to learn what you should be reimbursed for, how you should be paid, and what to do if your employer doesn’t pay owed business expenses.

Reimbursable Items by Your Employer

Under the California Labor Code your employer is required to reimburse you for all necessary expenditures you incur as a direct result of doing your job.  For these, had you not used your own personal items, your employer would have had to spend money for use of those items (buying, renting etc.) and so they have saved money.  But they can’t do so at your expense.  The reimbursable expenses can include the following:

1. Use of Your Vehicle (including accounting for wear and tear):

• You must be reimbursed for using your vehicle as part of your job (multiple locations, errands, driving as your job). This is separate from your pay for time worked.
• Commute: Your regular trip to and from work is usually not reimbursed (though exceptions exist).
• Wear and Tear: Reimbursement includes costs for wear and tear on your vehicle.

2. Required vehicle insurance is higher than the minimum required by law:

• If your employer requires you to have more insurance on your personal vehicle than the state minimum, you are entitled to reimbursement for this extra amount.

3. Cell phone/internet/laptop/iPad/tablet use:

• Personal Devices: If you use your own phone, laptop, tablet, or internet for work tasks (such as work apps, clocking in and out, taking photos for work tasks, messages, calls, etc.), you must be reimbursed.
• Internet: You must be reimbursed for using your home internet/hotspot for work whether your employer provides a device (such as a laptop) for you to use or you use your own personal device.
• Simple Check-ins: Just calling to check your schedule usually doesn’t count.

4. Uniforms/Tools:

• Uniforms: You must be reimbursed for buying/maintaining special clothing only needed for your job (not regular clothes you could wear elsewhere).
• Tools: You may be entitled to reimbursement. Rules for tool reimbursement vary and you should talk to a lawyer about your specific case.

Reimbursement Methods

These expense reimbursements can be calculated in different ways based on the type of expense.

1. Vehicle Use Payments:

• Employers can pay you per mile (which should be at least the IRS mileage rate, which is 70¢/mile in 2025), a flat monthly amount, or a mix (like a base amount plus an amount per mile).
• Key Rule: No matter how they pay, it must fairly cover your actual vehicle costs. Example: $100/month for 2,000 miles driven isn’t fair and does not cover the vehicle costs.

2. Extra Insurance Cost:

• This is part of your vehicle costs, and the amount is included in the vehicle use payment calculation to determine if the amount is fair.
• One way to look at it is to calculate the difference between the amount you pay for insurance at the state minimum insurance and the higher insurance your job requires.

3. Tech/Internet Payments:

• Employers might pay a flat monthly amount for using your phone, laptop, tablet, or internet.
• Key Rule: As with the above, this payment must fairly cover your actual expense. It should be close to what it would cost the employer to provide the service or device themselves (like buying/renting a laptop or paying a phone/internet bill) because without you using your device/internet, the employer would have to pay this amount.

4. Uniforms and Tools Payments:

• Employers should reimburse the actual cost of buying the required items and maintaining uniforms.

What Should You Do to be Reimbursed?

Many workers disregard these expenses, as they have come to expect they will need to use their own items for their jobs or think the reimbursement requirements only apply to other types of employees besides them. 

Use of your personal items matter, and you deserve proper reimbursement for them. Take the following steps to ensure your rights are protected:

• Document Everything: Save your receipts, records of business expenses, and expense claims to your employer to the extent any such documents exist for these expenses.
• Contact an Employment Attorney: Consult with an experienced California employment lawyer at Bisnar Chase to find out more about your legal rights.

Our employment law team at Bisnar Chase has an outstanding track record in holding employers accountable for workplace violations. We have recovered millions of dollars for wronged employees across California. Contact us for a free consultation.