California Business Expense Reimbursement (Labor Code §2802)

Employers must reimburse employees for all necessary expenditures incurred in the direct discharge of their job duties. Employees cannot waive this right.

• Mileage and personal-vehicle use for work;
• Tools, equipment, and required uniforms;
• A reasonable percentage of a personal cell phone used for work, and other necessary home-office costs such as internet.

When employees work from home, § 2802 still reaches necessary work expenses, and a government stay-at-home order does not break the chain of causation (Thai v. Int'l Business Machines Corp., No. A165390 (Cal. Ct. App. July 11, 2023)). For a personal cell phone the amount is settled — a reasonable percentage of the bill, even if the employee would have had the plan anyway (Cochran v. Schwan's Home Serv., Inc., 228 Cal. App. 4th 1137 (2014)). For mixed personal/work costs such as home internet the share an employer must cover is unsettled — Thai expressly declined to reach it — so document the expense and use a method you can defend.

• Adopt a clear written reimbursement policy;
• Use a reasonable method — actual cost or a reasonable stipend that genuinely covers the expense;
• Reimburse promptly, and revisit stipend amounts so they keep pace with real costs.

§2802 claims are common in PAGA and class actions, and interest and attorney's fees are recoverable — so getting the policy right matters.