Under California Labor Code Section 2802, employers must reimburse employees 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.” Meaning that an employer must reimburse an employee for all monies that they spend or lose, directly related to performing their duties or following employer directions. Where an employer fails to do so, Section 2802 allows an employee to recover, along with any unreimbursed expenses, interest from the date the expense was incurred, as well as any reasonable attorneys’ fees and costs incurred by the employee to enforce the rights granted by the statute.
With respect to mileage reimbursement, California state agencies, including the Department of Labor Standards Enforcement (“DLSE”), consider the IRS rate to be the most reasonable reimbursement rate. The IRS increased the standard mileage rate for the use of a car effective January 1, 2013, to 56.5 cents per mile for business miles driven. Although using the IRS rate is the best practice, employers may reimburse for mileage expenses at less than the IRS rate as long as the payment reimburses the employee for all actual expenses incurred by the employee in the operation of the vehicle for business use.[/column]
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