According to an article by Fisher Phillips, recent California class and collective lawsuits are starting to reveal a particular trend of litigation where employees are claiming unreimbursed work-related expenses.
For instance, a Private Attorneys General Act (PAGA) action filed on January 15 in the Superior Court of Merced alleges that Foster Farms failed to provide and reimburse employees for the cost of personal protective equipment (PPE). Specifically, the employees allege that they were forced to purchase PPE such as masks, gloves, and hand sanitizer without reimbursement.
In their complaint, the employees argue that California case law requires employers to provide their employees with PPE, at the employer’s expense, and employees must be reimbursed for any such materials that the employees purchase if the employer fails to do so.
In another recent 2021 lawsuit, a class action filed in Orange County Superior Court, the employee alleges that Anyone Home, Inc. failed to provide reimbursement for her and other similarly situated employees’ home internet, home telephone, personal cell phone, personal computer, utility costs, office furniture, and insurance from July 2019.
In both of these cases, the employees allege they were required to purchase alleged necessary business expenses but not reimbursed for these purchases.
Both cases are at their infancy, and no court has made a ruling on the merits of the allegations raised in either case.
California Labor Code § 2802 explicitly requires employers to reimburse their employees for the necessary business expenses that they incur. Specifically, employees must be reimbursed for expenses that are necessarily incurred in direct consequence of their job duties or in complying with an employer’s directions. In general, the law only requires reimbursement of necessary and reasonable expenses; unnecessary or unreasonably exorbitant expenses need not be reimbursed.
Traditionally, most remote work expenses have not been reimbursable because most employers’ telecommuting and remote work programs were typically voluntary and not required.
However, in today’s COVID-19-regulated environment, remote work has become mandatory for many industries, therefore changing certain employers’ reimbursement obligations. When remote work is mandatory – even if ordered by California or local authorities – employees must be reimbursed for the necessary expenses they incur while working at home. The issue of whether certain expenses were “necessarily incurred” by an employee is subject to court scrutiny and various employer defenses.
Regrettably, the California Labor Commissioner’s office has failed to issue COVID-specific expense reimbursement guidance to aid employers in navigating this new vast remote work environment.