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In response to the Coronavirus/COVID-19 global pandemic, California issued a statewide shelter-in-place order that prohibits all workers except essential workers from leaving their homes.  Thus, millions of California employees have spent months working from home to prevent the spread of the virus further.  Due to the unprecedented circumstances surrounding the Coronavirus/COVID-19 pandemic, employers requiring their employees to work at home may be unlawfully passing operation expenses onto their employees.  Already a common issue, employees’ failure to reimburse employees for mandatory business expenses is rampant during the Coronavirus/COVID-19 pandemic. As employees continue working from home during the Coronavirus/COVID-19 pandemic, California Labor Code section 2802, which requires employee reimbursement for all necessary expenses incurred while completing work duties, operates to ensure employers who fail to provide necessary equipment and resources for completing the job reimburse employees who use their personal property.  Employees forced to use their personal equipment, such as cell phones, computers, printers, and vehicles, without reimbursement have claims.  This article provides employees with analysis and tips related to expense reimbursement of remote workers in California, with a focus on the present Coronavirus/COVID-19 pandemic.

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. California Labor Code § 2802. Necessary expenditures or losses include all reasonable costs.  Id. To prevail on a failure to reimburse claim, California employees must show:
  1. They incurred necessary expenditures;
  2. While in the discharge of their job duties;
  3. The employer knew or had reason to know of the expenditures; and,
  4. The employer did not exercise due diligence towards reimbursement.  Cochran v. Schwan’s Home Services, Inc., 228 Cal. App. 4th 1137 (2014).

Expenses Covered While Working From Home During Coronavirus/COVID-19 Pandemic

Mask Reimbursement

Employers must reimburse employees for the costs of masks, and other COVID-19/Coronavirus personal protective equipment, where the equipment is necessary to complete the work under California Labor Code section 2802.

Personal Cell Phone Reimbursement

In Cochran v. Schawn’s Home Services, Inc., the California Court of Appeal expressly held that California Labor Code section 2802 covers employees’ mandatory use of personal cell phones while completing job duties.  Cochran v. Schawn’s Home Services, Inc., 228 Cal. App. 4th 1137 (2014).  The court reasoned, “[i]f an employee is required to make work-related calls on a personal cell phone, then he or she is incurring an expense for purposes of section 2802.”  Cochranat 1144.  For liability to attach to the employer, the employee, “need only show that he or she was required to use a personal cell phone to make work-related calls, and he or she was not reimbursed.”  Cochranat 1145. Non-essential employees forced to work from home may be using their personal cell phones for work-related calls.  However, under California law, employers must provide telephone equipment, or VOIP software, that allows the employee to perform their job duties.  California employees using their personal cell phones for work during the Coronavirus/COVID-19 should request that their employer either provide the necessary equipment or a reimbursement.

Personal Cell Phone Data Reimbursement

Although the Cochrancourt only considered phone calls made on personal cell phones, employer’s increasing reliance on smart phone’s sophisticated data-consuming capabilities, such as mandating the use of employer applications, are also covered under Labor Code section 2802.  For example, employers requiring employees to clock in and out on a cell phone app must either provide a cell phone or reimburse employees for using the application on a personal cell phone.

Personal Printer Reimbursement

Although the Cochran case does not consider reimbursement for use beyond personal cell phones, the Court of Appeal’s rationale can be applied to employee use of other electronic equipment, such as personal printers.  Like cell phones, printers have a recurring cost, in the form of ink, drum units, and their other mechanical parts.  Presently, many California employers enjoy reduced expenses as employees print from personal printers.  Consequently, employees forced to use their personal printers while working from home during the Coronavirus/COVID-19 pandemic are entitled to reimbursement.

Personal Vehicle Reimbursement

In 2007, the California Court of Appeal reaffirmed the longstanding precept requiring employers to reimburse employees’ mandatory use of personal vehicles for completing job duties, typically at the IRS’ annual standard mileage rate.  Gattuso v. Harte-Hanks Shoppers, Inc., 42 Cal. 4th 554 (2007).  While other reimbursement methods exist, the Court construed the IRS standard mileage rate as most reasonable because the figure was, “a national average of the cost of operating a motor vehicle without respect to the initial cost of purchase or lease…, repairs and maintenance, fluctuating fuel costs, and…cost of insurance.”  Gattusoat 565.  Employees forced to operate their personal vehicles for work-related activities during the Coronavirus/COVID-19 pandemic are owed reimbursement from their employers.

Personal Computer Reimbursement

Although no opinion exists regarding reimbursement for an employees’ use of their personal computer, iPad, or tablet, employees are still entitled to reimbursement under California Labor Code section 2802.  As with personal vehicle use, computer use engenders known non-recurring costs, such as repairs, maintenance, and cleaning. Additionally, depreciation costs are associated with the use of electronic equipment.  A reasonable reimbursement recognizes these costs to employees.  Thus, employees forced to use their personal computers during the Coronavirus/COVID-19 pandemic are entitled to reasonable reimbursement.

Personal Internet Reimbursement

California state courts have not grappled with reimbursement for an employee’s use of personal internet.  Existing case law suggests employers must reimburse employees using their personal internet connections for company business.

Personal Software Reimbursement

Employers who do not provide employees with application or software access must reimburse employees for the use of their personal software, when it is necessary for completing work duties.

Reimbursement Amount

Reimbursements must be reasonable.  Cochran v. Schawn’s Home Services, Inc., 228 Cal. App. 4th 1137 (2014) (“[T]he employer must pay some reasonable percentage of the employee's cell phone bill.  Because of the differences in cell phone plans and work-related scenarios, the calculation of reimbursement must be left to [the court] and parties in each particular case.”)  Determining the appropriate amount for a reasonable reimbursement is a fact-specific inquiry that depends on the unique circumstances surrounding the employment relationship.

Employees Cannot Waive Their Right to Reimbursement During Coronavirus/COVID-19 Pandemic

California courts hold that waiving the right to Labor Code section 2802 reimbursement is against public policy.  Edwards v. Arthur Anderson LLP, 44 Cal. 4th 937, 951 (2008).  Thus, any agreement made by an employee to waive their right to reimbursement is void. California Labor Code § 2804.  In finding reimbursement waivers void, courts hold a private agreement cannot contravene California’s strong public policy favoring employee reimbursement.  Edwards v. Arthur Anderson LLP at 630.  The current Coronavirus/COVID-19 pandemic does not alter this well-established principle.

Damages for California Employer’s Failure to Reimburse during Coronavirus/COVID-19 Pandemic

An employee forced to use personal property for mandatory business-related activities is entitled to reimbursement.  Where the employer fails to provide reimbursement, the employee may recover the amount owed, interest, and attorney fees incurred by the employee enforcing their right to reimbursement.  California Labor Code § 2802.

Astanehe Law Knows Employee Rights

Astanehe Law has experience handling California failure to reimburse claims.  Mr. Astanehe has recovered millions on behalf of Californians.  If your employer has failed to reimburse you for mandatory business expenses, contact Astanehe Law.  Our California employment law attorneys can discuss your options with you and help you learn your rights.  Contact Astanehe Law to discuss your options with an experienced California employment law attorney.