CA Labor Code 2802 (a) Self Audit California has the strictest business reimbursement labor code in the country. Cell phones are ubiquitous in the fields among employees, foremen and supervisors. Labor Code Section 2802. All comments must be submitted in writing (by mail, fax, or email) and received by that time by DLSE's Regulation Coordinator. The code ensures that “An employer shall indemnify his or her employee for all necessary expenditures or losses incurred by the employee in direct consequence of … Code § 2802(a). Necessary expenditures include any attorney fees or costs incurred by employees to recoup expenses from their employer. California Labor Code § 2802. Audit your car allowance or reimbursement policy to identify exposure points. California Labor Code section 2802 has been around for a long time (since 1937, to be exact). One section requires employers to provide and maintain tools and equipment if such tools are required by the employer or are necessary for the job. This important statute reads as follows: 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, or of his or her obedience to the directions of the employer . The California Labor Code requires employers to indemnify employees for all expenses incurred in connection with their employment. Learn what a Western Growers membership has to offer. Any interested person, or authorized representative, may submit written comments to DLSE relevant to the proposed regulatory action. The code states that the penalty for not reimbursing an employee includes: Costs incurred in obtaining reimbursement Liability for expenses, plus interest In general, employers must reimburse the cost of uniforms, travel expenses, tools and equipment required for the job. Who is submitting the receipt? California’s wage and hour plaintiff attorneys have seized on expense reimbursement as another means of extracting large settlements from unwary employers. Why $500/month runs afoul of California Labor Code 2802 (a) If you have employees in California, precede with extreme caution, especially if paying a flat, taxable car allowance. Furthermore, a court has ruled that an employer must always reimburse and employee for the reasonable expense of mandatory personal cell use even when the employee incurs no extra charge on his phone plan. The penalty amounts and procedures applicable to “expenses” are set forth in Labor Code … Necessary expenditures or losses include all reasonable costs. Lab. . A public hearing on the proposed regulations was held on February 7, 2007 in San “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. Labor Code Section 2802. The office, all supervisors and foremen should have a supply of such forms and instructions on their use. The policy should also be featured in any employee manual or set of rules. Once the policy is established, the company should use specific reimbursement forms designed by the employer. The cost of operating a vehicle in California is among the highest in the country. An example is a foreman who transports drinking water, bathroom supplies or tools in his personal truck. The new Illinois law mirrors key language in California Labor Code Section 2802, California's expense reimbursement law. 2802. Ensuring employee awareness of a reimbursement policy is a vital step in preventing class action claims. A different standard applies to necessary safety equipment (Personal Protective Equipment or PPEs) such as goggles, gloves and hard hats necessary to protect employees from work place hazards. This indemnification obligation can also include liability for an employee’s unlawful behavior when the employee was acting on the orders of the company. California Employment law requires employers to reimburse employees for all “necessary” expenses they incur while performing their jobs. To clarify this indemnification obligation under section 2802, the California Division of Labor Standards Enforcement has proposed new travel and expense regulations. Mileage reimbursement in California is governed by California Labor Code Section 2802. When does the required use of cell phones for work trigger the obligation to reimburse an employee for such use? The California Labor Code Section 2802 states that employers must reimburse employees for all necessary, job-related expenses or losses the employee incurs, such as tools, supplies, travel expenses, mileage, food, lodging, and other business expenses. California employers must reimburse you for some utilities ... then an employer must reimburse their associates for a portion of the Internet expense they incur under California Labor Code … Including the reimbursement language in this document establishes that the employer has a lawful policy. Employers are not only liable for a judgment entered against an employee for wrongful conduct, they are also required to pay the cost of the employee’s defense in such cases. In doing so, the employer can utilize an actual reimbursement, mileage reimbursement, or lump-sum method. When travel in personal vehicles is required during the day, the foreman should note the distance travelled on the crew sheet. California law mandates that employers reimburse employees for work-related expenses. Most of the time employees who use their personal vehicles for short distances will not take the time to obtain, fill out and turn in a form for a couple of dollars. Gattuso v. The Internal Revenue Service Rate rate ($0.58 per mile in 2019) is an acceptable rate to pay for work-related use of a personal vehicle. An example is when employees use their cars to travel between fields during the day. California Labor Code section 2802 has been held to cover the following types of necessary expenses: Personal Vehicle Usage: Employers must reimburse employees who use their personal vehicles in completing job duties, typically at the IRS’ standard mileage rate. Many agricultural employers do not realize they have incurred travel expense obligations when they require employees to use their personal vehicles for work. Costs of doing business in California. It does not specify what amounts are specifically necessary. However, some employees, such as irrigators, quality control employees and truck drivers who receive multiple daily instructions or who must regularly report from remote locations are entitled to reimbursement if a personal cell phone is used. If a California employer requires an employee to drive on official company business, it must either provide the employee with a vehicle, for which all expenses are covered, or reimburse the employee for the cost of driving. In general, non-exempt harvesters would not be able to claim reimbursement for personal cell use. California courts have adjudicated several reimbursement claims. Subscribe to Labor Code Section 2802. California Labor Code Section 2802 obligates employers to reimburse their employees for all expenses incurred during the discharge of their duty. Mileage reimbursement in California is governed by both the Labor Code, Section 2802, and the California Code of Regulations, Title 8, Section 13700-13702. If you have employees receiving a car allowance or even a mileage reimbursement you could be exposed. DLSE requests, but does not require, that persons who make oral comments at the hearing also submit a written copy of their testimony at the hearing. However, any employee using their car to drive between fields after the start of work is entitled to a mileage reimbursement. In addition to paying for travel time, under California Labor Code section 2802, employers are responsible for paying employees’ “necessary” business expenses, including travel-related expenses. In a recent lawsuit, a plaintiffs’ firm is contending that the employer’s failure to provide tools is a violation of the minimum wage law and are seeking the difference between $22.00 per hour and the employee’s actual hourly rate! Employers may initially be concerned about excessive reimbursement claims. Some guidance on what expenses must be covered under Labor Code§ 2802 is in the Wage Orders. Nevertheless, supervisors must provide the forms and never discourage their use. Corbett H. Williams Employment Law. However, an employer need not defend an employee if the employee knew that his actions were unlawful. For example, California has just passed a requirement for respiratory devices to protect outdoor employees from wildfire smoke and Cal-OSHA is now requiring ammonia facilities such as produce coolers to install self-rescue respiratory masks. The Year in Review LEGISLATIVE INACTION: It was not the best of times nor the worst of times, Tractor-Mounted Personnel Platforms Update, Collections, PACA Support, Produce Price Index, Corporate, Retirement and Individual Investments. The general reimbursement statute of the California Labor Code is Section 2802. California Labor Code § 2802: Employers Duty to Reimburse California Labor Code section 2802 requires employers to reimburse employees, “for all necessary expenditures or losses incurred by the employee” while completing work duties. If you are paying a $500 monthly car allowance to employees that reside in California, it could pose serious problems. Labor Code § 2802 requires California employers to reimburse employees for all necessary expenditures incurred in the performance of their duties. The written comment period closes at 5:00 p.m. on February 7, 2007. The purpose of this statute is "to prevent employers from passing their operating expenses on to their employees." Western Growers members care deeply for the food they grow, the land they sustain, the people they employ, and the community in which they live.Â. Labor Code § 2802 requires California employers to reimburse employees for all necessary expenditures incurred in the performance of their duties. As this year was in its infant stages, it was a good bet that legislative action on both the national and state levels could make it a watershed year for the agricultural industry. This rule, embodied in California Labor Code Section 2802, prohibits employers from shifting their costs of doing business onto the backs of employees. California law also requires employers to cover any legal expenses (attorneys’ fees) an employee incurs to enforce the rights granted by Section 2802. Gattuso v. Department of Industrial Relations The court noted that certain articles of clothing which are “usual and generally usable in the occupation” do not meet the standard of a “uniform” which must be reimbursed. They have alternatively been referred to by various monikers, including but not limited to: “personnel transport platforms,” “personnel transportation units,” “tractor personnel carriers,” and “tractor baskets,” among other names.  But the Division of Occupational Safety and Health (“DOSH”), bett, Almost every time the Western Growers’ Board of Directors meets, it has to read and hear lengthy reports on a growing list of anti-business legislation and regulations proposed or in force in California.  The directors from Arizona cast glances at one another and smile.  You can almost hear them. Labor Code Section 2802 Requires Employers To Indemnify Employees Labor Code section 2802 requires an employer to “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....” . Section 2802 of the California Labor Code requires employers to reimburse their employees for the reasonable and "necessary" expenses they incur in direct consequence of discharging their job duties. Under section 2802 of the California Labor Code, “[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.” Cal. What is the California law on mileage reimbursement? Can I file a lawsuit to get unpaid travel expenses reimbursed in California? Labor Code Section 2802 Travel Expense Reimbursements Title 8 of the California Code of Regulations Sections 13700 through 13706 Notice of Proposed Rulemaking, Title 8 of the California Code of Regulations, Sections 13700 through 13706 CA 2802. Employees who make more than twice the minimum wage may be required to provide their own hand tools required by their specific trade. Email: sesmith@dir.ca.gov Other gear must be reimbursed under certain circumstances. Mileage reimbursement rates do not necessarily have to be set at the IRS rate, but use caution. California Labor Code Section 2802 provides as follows: (a) 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, or of his or her obedience to the directions of the employer, even though unlawful, unless the employee, at the time of obeying the directions, believed … The employer is also required to pay interest at a rate of 10% per year on any unreimursed expenses incurred by the employee. A statutory duty generally has a three-year statute of limitations, [See CCP Sec. A policy which prescribes the use of authorized forms submitted within a designated time period will ensure that reimbursement requests are timely for budgeting, billing and tax purposes and ensure that all employees are treated consistently. Motus Logo Platform An employee’s right to be reimbursed for necessary expense should be contained in the Labor Code Section 2810.5 notice. California law in this area differs from federal law. The California Labor Code – and, consequently, Section 2802 – only … There is an exception to the ‘to and from’ work exemption. Such equipment is mandated by OSHA. This section reads, in relevant part: “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, or of his or her obedience to the directions of the employer.” June 27, 2017. An employer’s obligation under Labor Code section 2802 requires it to compensate an employee for all expenses actually and necessarily incurred. DLSE has scheduled one public hearing on this proposed adtion: Please note that public comment will begin promptly at 10:00 a.m. and will conclude at 12 noon or when the last speaker has finished his or her presentation, whichever occurs last. Driving to and from work at the beginning and end of the day is not compensable. A written notice with rates of pay, payday, employer identification information and sick leave benefits must be provided to all new employees and should be given to all seasonal employees when they start a new season. (a) 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, or of his or her obedience to the directions of the employer, even though unlawful, unless the employee, at the time of obeying the directions, believed them to be unlawful. . 335 through 349.5] while the recovery of a penalty generally has a one-year statute of limitations. In general, employers must reimburse the cost of uniforms, travel expenses, tools and equipment required for the job. This does not include commuting to and from work. Most employers are aware of the need to reimburse for work-related travel, meals and mileage. Necessary expenditures include any attorney fees or costs incurred by employees to recoup expenses from their employer. If an employee’s duties require the use of the employee’s car, the employee should receive reimbursement for automobile expenses such as mileage, gas, and wear and tear. The difficulty of distinguishing between personal use and business use has led most employers to simply provide phones to their management staff. A recent court decision clarified that merely requiring slip-resistant shoes at Denny’s restaurants did not trigger an obligation to pay employees for those shoes. California Labor Code Section 2802 states an employer shall indemnify his/her employee for all necessary expenditures or losses incurred by the employee in the direct consequence of the discharge of his/her duties. Under California Labor Code 2802, the employer must reimburse their employees for vehicle expenses if they are required to use their personal vehicle for work-related activities. Citing Section 2802, plaintiffs' attorneys have aggressively pursued claims against California employers for failure to reimburse various employee expenses, including home internet and cell phone costs. The Fair Labor Standards Act (FLSA) doesn't require employers to reimburse for mileage or other vehicle expenses, but California law does. Finally, the forms should allow for reimbursement of other necessary expenses such as cell phone use, special gear, supplies or uniforms. 801 "K" Street, Suite 2100 California Labor Code section 2802 obligates employers to reimburse employees for “all necessary expenditures or losses incurred by the employee in direct consequence of the discharge of his or her duties, …” The Cochran decision posed, and answered, the “threshold question” presented on appeal as follows: In order to resolve such issues the employer could reimburse a reasonable portion of the cell cost or provide a low cost phone to such employees. California Labor Code section 2802 requires employers to indemnify their workers for expenses they necessarily incur in their duties. If the employee incurred expenses and the expenses incurred are necessary to do the job, the employer must reimburse the employees for … Submit comments to: Susie Smith, Regulation Coordinator Fax: (916) 322-1267, (Elevator, Ride & Tramway, Pressure Vessel), Permits, Registrations, Certifications, & Licenses, Worker Safety & Health in Wildfire Regions, Electronic Adjudication Management System, Commission on Health and Safety and Workers' Compensation (CHSWC), Locations, Contacts, and Hours of Operation, Licensing, registrations, certifications & permits. A foreman or supervisor uses a cell phone to contact others in the company or his subordinates is clearly entitled to reimbursement of such costs. In agriculture, most employers have policies requiring sturdy shoes and prohibiting open-toe footwear. By ... a multitude of nuances once one examines all the different costs that arise in the employment context and the various Labor Code and Wage Order provisions that apply. Sacramento, CA 95814 Employers sometimes focus on federal tax-related rules and impose “per diem” expense limits set by the Internal Revenue Service. The … Both the California Supreme Court and the Division of Labor Standards Enforcement (DLSE) take the position that payment of a reasonable mileage reimbursement satisfies the Labor Code. At the hearing, any person may present statements or arguments, orally or in writing, relevant to the proposed action. If an employer fails to … Employees who are required to transport tools and equipment necessary for the operation may be entitled to additional mileage reimbursement. Another section covers employer-required uniforms. 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